Ben Reitzes says iPhone not replaceable, buy Apple stock before event

Melius Research's Ben Reitzes recommends buying Apple (AAPL) stock ahead of its September 9th 'Awe Dropping' event, anticipating renewed investor enthusiasm driven by the irreplaceable iPhone 17 lineup and potential for higher average selling prices. Reitzes dismisses concerns about Apple's AI lag, asserting the company will benefit regardless as a 'toll road to AI glory.' He projects a conservative price target of $260, noting broader Wall Street targets up to $275, indicating significant upside despite AAPL's recent underperformance against tech peers.

Analysis

Melius Research presents a strongly bullish thesis on Apple Inc. (AAPL) centered on the upcoming September 9th 'Awe Dropping' event, which is positioned as a catalyst to reverse the stock's recent underperformance. Despite AAPL trading approximately 3% below its year-to-date high, the core argument is that the iPhone ecosystem is 'not replaceable,' ensuring sustained market share and consumer loyalty. The launch of four new iPhone 17 models, including a premium 'iPhone Air,' is expected to drive higher average selling prices (ASPs) and initiate a new multi-year upgrade cycle. Concerns regarding Apple's perceived lag in generative AI are countered by framing the company as a 'toll road to AI glory,' set to monetize its platform regardless of AI leadership, a view supported by a pipeline of AI-enabled accessories. This outlook is quantified by a 'very conservative' near-term price target of $260 from analyst Ben Reitzes, with broader Wall Street targets reaching up to $275, implying potential upside of over 15%.

Key Decisions for Investors

• Investors with a bullish view on Apple's product cycle could consider initiating or adding to AAPL positions ahead of the September 9th event, which is being presented as a significant near-term catalyst.
• Monitor the market's reception and initial sales data for the iPhone 17 lineup, as the bull case is heavily dependent on the new models successfully increasing average selling prices and unit growth.
• Evaluate entry points against the analyst price targets of $260-$275, while remaining mindful that a disappointing product launch could extend the stock's recent underperformance relative to tech peers.
• Re-assess the narrative around Apple's AI position, as the 'toll road' thesis suggests a path to monetization that is less dependent on leading foundational model development and may be underappreciated by the market.