Apple Price Target Raised by Wedbush

Wedbush raised the Apple (AAPL) price target to $400 on May 8 and maintained an Outperform rating, citing the company’s AI strategy, including iOS 27 features and potential partnerships in China, as key drivers for expanded services revenue and valuation upside.

Wedbush Upgrade and Street Context

The $50 increase is Wedbush’s largest since at least 2021, reversing its prior tariff-driven stance. Previous targets included $350 set in December 2025, $250 in April 2025 amid tariff concerns, and $325 before those measures. The new target is the highest on the Street, exceeding the analyst consensus near $303.

Wedbush said the revision reflects a reassessment of earnings and services growth potential across Apple’s device and software ecosystem. The firm highlighted Apple’s May 1 quarter, which showed 14.0% sales growth and a revenue outlook that beat estimates despite memory and chip supply constraints and rising costs. This backdrop supports a services-focused valuation case.

AI Strategy and Monetization

Wedbush said iOS 27 will enable iPhones and iPads to access multiple third-party AI models and encourage developers to build applications leveraging Apple’s system-level enhancements. The firm identified WWDC 2026 as a pivotal event, estimating that roughly one-fifth of the global population could use Apple-delivered AI services in the coming years, a scale it views as material to the services opportunity.

The analyst projected AI monetization could generate $15.0 billion annually from services, citing partnerships in China, including one with Alibaba, and the potential for paid AI features. Wedbush described 2026 as an inflection year, linking its upside case to a hardware strategy associated with John Ternus and to management’s positioning of Apple Intelligence as an integrated user experience across devices.

Earnings and Strategic Implications

Apple’s May 1 quarter showed strong sales growth and an optimistic revenue forecast despite supply constraints and rising costs. Wedbush framed 2026 as a pivotal year for AI adoption, referencing a hardware strategy tied to John Ternus and Tim Cook’s description of Apple Intelligence as an intuitive, integrated user experience across devices.

The upgrade widens the gap with Street consensus and ties near-term valuation upside to Apple’s AI adoption and services monetization ahead of WWDC and upcoming product-cycle events.