Evercore ISI maintains Apple stock target on strong App Store growth
Investing.com
Published Jun 03, 2025 05:27AM ET
On Tuesday, Evercore ISI analysts reiterated an Outperform rating and maintained a $250 price target on Apple stock (NASDAQ:AAPL), which currently trades at $201.70. The decision follows a reported increase in App Store revenue, which grew by 13% in May, slightly higher than the 12% growth observed in April. According to InvestingPro data, Apple's overall revenue growth stands at 4.91% over the last twelve months, reaching $400.37 billion.
The analysts highlighted that the U.S. market showed a 10% revenue increase, marking the highest growth rate since January. This development comes amid concerns from investors following an April 30th ruling requiring Apple to allow developers to direct users to non-Apple payment options. Despite this, Evercore ISI believes many developers will continue using Apple's in-app payment system, at least in the short term. InvestingPro analysis indicates Apple maintains a "GOOD" financial health score, suggesting robust operational stability.
The analysts noted that the App Store data from May supports the notion that developers are proceeding cautiously rather than rapidly moving away from the platform. They estimate that the U.S. App Store contributes 2% to Apple's overall revenue and 6% to its earnings per share (EPS). With a market capitalization of $3.01 trillion, Apple remains a dominant force in the technology sector. For deeper insights into Apple's valuation and growth metrics, access the comprehensive Pro Research Report available on InvestingPro , which covers over 1,400 top US stocks.
Concerns have been raised about the potential for this revenue to decline to zero, especially after Apple chose not to provide a Services growth guide for the June quarter. The analysts anticipate that June's data will offer a clearer picture of the ruling's impact, as developers will have had more time to assess the situation.
In conclusion, Evercore ISI's analysis suggests that May's App Store data does not yet show a significant impact from the ruling. They emphasize that June's data will be crucial in determining whether Apple's Services growth can remain in the double digits.
In other recent news, Apple's services segment, notably the App Store, has shown significant growth. Goldman Sachs reiterated its Buy rating for Apple, maintaining a price target of $253.00, as App Store spending increased by 12% and 13% year-over-year in April and May 2025, respectively. This growth has contributed to a 12% year-over-year increase in Apple's second fiscal quarter services revenue, surpassing Goldman Sachs and FactSet consensus estimates. The App Store is projected to account for 27% of Apple's total services revenue for the third quarter of fiscal year 2025.
Citi also maintained a Buy rating for Apple with a price target of $240. The anticipation surrounding Apple's Worldwide Developers Conference (WWDC) has been a focal point, with expectations of significant software updates and potential new product announcements. Despite a delay in AI-powered Siri features, Citi analysts highlighted Apple's strategic positioning due to its integrated approach across hardware, software, and services.
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Additionally, shipments of foreign-branded mobile phones, including Apple's iPhones, in China rose slightly by 0.8% in April, according to the China Academy of Information and Communications Technology. Meanwhile, Apple, along with other tech giants, experienced a dip in premarket trading amid geopolitical uncertainties and concerns over tariff policies.
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Written By: Investing.com
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