- Apple (AAPL +0.8%) appears "headed for a second-half sales bonanza" fueled by the arrival of one or more large-screen iPhone 6 models, writes Barron's Jack Hough.
- He thinks the iPhone 6 launch could lead the percentage of iPhone owners who upgrade in a quarter to return to peak levels of 12%-14% later this year, after having fallen to ~9% in recent quarters. The iPhone has an installed base of 260M users.
- Hough also exudes praise for Apple's "hardware-as-a-service" business model, and thinks shares could rise 20% to $635, or 13.6x C2015E EPS, next year, given Microsoft currently goes for 14.4x C2014E EPS.
- Meanwhile, Pac Crest and UBS are each out with bullish notes. Pac Crest's checks lead it to think March and June quarter iPhone volumes could exceed its estimates of 39.7M and 33.6M, and that initial iPhone 6 component orders "[provide] a positive bias to our previous unit expectations."
- UBS thinks the March and June quarters could be soft, largely due to iPhone 5C and iPad weakness, but thinks Sep. quarter sales will be healthy thanks to iPhone 6 demand.
- Apple is ticking higher in the face of a 1.7% Nasdaq drop, as is supplier Cirrus Logic (CRUS +1.3%).
- Earlier: Apple, Comcast reportedly in streaming service talks
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