Mizuho Securities’s Abhey Lamba this evening joins the 700 Club, raising his price target on Apple (AAPL) to $700 from $635, and reiterating a Buy rating on the stock, based on his expectation for a dividend and for higher iPad sales.
Lamba expects that tomorrow’s press conference by the company will probably involve a dividend announcement.
“In our view, a dividend with an annual run-rate of $10/share (~2% yield) will likely be a good start,” writes Lamba.
“Additionally, we believe AAPL will have to look at splitting the stock to increase retail participation. Apple last split its stock in Feb 2005.”
Lamba also raised his iPad estimate for this quarter to 12.5 million from a prior 10 million unit estimate, citing longer lead times quoted on Apple’s online store. Lamba expects Apple sold more than 1 million units this weekend. (Presumably, he is including online pre-orders, though he doesn’t say so explicitly.)
He also thinks that competitors, in addition to struggling to beat the lower, $399 price of the iPad 2, run the risk of Microsoft’s (MSFT) Windows 8 being delayed past September, although he doesn’t say why that would be the case.
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