Apple
unveiled a high-price mixed-reality headset earlier this month, and one analyst thinks a less expensive version of the hardware would be a major benefit to the company’s earnings and revenue.
Apple
(ticker: AAPL) announced the highly anticipated Vision Pro headset at its World Wide Developers Conference earlier this month. The headset won’t be released until 2024 and will retail for $3,499.
Evercore ISI analyst Amit Daryanani wrote in a research note over the weekend that the cost of the headset might stop some interested customers from buying. A a lower-priced version could be a strong move for Apple, he said.
“Assuming the Vision Pro can achieve about 1% iOS penetration by Year 5 (about 14 million units), it would suggest approximate revenue/EPS contribution of $19 billion/20 cents a share. If Apple additionally releases a lower-priced Vision product, revenue/EPS could show upside to $43 billion/46 cents a share in total,” Daryanani said.
Daryanani isn’t the first analyst to see potential benefits from a less expensive model of the headset. BofA Securities analyst Wamsi Mohan wrote in a research note on June 6, following the developers’ conference, that he expects “at least some subsequent versions of Vision Pro to be priced lower in order to appeal to a larger customer set.”
Mohan rates Apple as Neutral with a $190 price target.
Daryanani maintained an Outperform rating on the stock with a target of $210 for the price. He said that although the current price of the headset might discourage people from buying one, he believes that the Vision Pro “showcases the outsized innovation within AAPL and their ability to integrate hardware, software and services to offer a cohesive solution to consumers.”
Shares of Apple were up 0.5% Tuesday to $185.89. The stock has jumped 43% in 2023.
Write to Angela Palumbo at [email protected]
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