Apple's (AAPL), stock is rising in anticipation of the consumer electronics company's earnings report for its March quarter, as investors bet that it will come out better than expected.
The Cupertino-based company will announce its fiscal second-quarter earnings late Thursday.
FactSet polled analysts who predict Apple to earn $1.43 per share, down by 6% on the year, and sales of $92.9billion, down by 5%. Apple's sales and earnings would have declined for the second quarter in a row due to weak demand for Macs and iPhones.
Wall Street hopes for positive news about Apple's sales in China and India, as well as continued growth of services.
Apple Stock Outperforms S&P 500
Apple's stock has risen 29.9% in the past year. S&P 500 rose 8.5%.
In a note sent to clients recently, Morgan Stanley's Erik Woodring described Apple as "the best house" in a challenging neighborhood. Apple is a "top choice" for him, with a 180-dollar price target.
Apple shares rose by 0.2% in afternoon trading today to reach 168.76.
Woodring expects Apple to post similar results, but guides analysts lower for the second quarter.
He sees a few catalysts in the months to come for Apple's stock. The rumored launch of a mixed reality headset is one of them. It's expected to happen at Apple's Worldwide Developers Conference, in June.
Another catalyst could be a resurgence in services growth during the second quarter of this year and an improvement in foreign exchange headwinds. Woodring added that Apple's iPhone 15 series launch this fall should boost handset sales.
Apple's Strong Balance Sheet and Quality Earnings
Sidney Ho, an analyst at Deutsche Bank, expects Apple will deliver mixed results and provide mixed guidance. He rates Apple as a buy, with a 170 price target.
Ho wrote in a client note that "Investors have been attracted to the quality of earnings, and its strong financial position in an uncertain macro-environment." "We expect that this investor preference will continue."
Apple stock appears on the IBD Tech Leaders List. According to IBD stock Checkup, the IBD Composite rating is 92 out 99.
IBD Composite Rating combines key technical and fundamental metrics to help investors assess a stock. The Composite Rating should be 90 or higher for the best growth stocks.