Win McNamee/Getty Images News
Wedbush said Apple’s (NASDAQ:AAPL) $100B investment in the U.S. is a “good strategic poker move for Cook.”
The firm has maintained its Outperform rating and $270 price target on the stock. Shares of Apple climbed about 3% premarket on Thursday.
On Wednesday, Apple’s CEO Tim Cook announced the company’s U.S. investment commitments in an Oval Office event, saying that the company would boost an early 2025 commitment by $100B over the coming four years. This would take the total commitment to $600B in the U.S. over that time span, up from an early February promise to invest $500B.
Analysts led by Daniel Ives said the American Manufacturing Program will help fund a major expansion of Apple’s long-standing partnership with Corning (NYSE:GLW) bringing the company’s smartphone glass production line to Corning’s factory in Kentucky.
Shares of Corning jumped about 8% premarket on Thursday.
The analysts added that the company also announced it signed a new multi-year deal with Coherent (NYSE:COHR) which produces the VCSEL lasers that enable features such as Face ID to be made at Coherent’s Texas facility along with reassuring its previously announced commitment signed in July with MP Materials to buy its rare earth magnets along with investments in MP’s California Mountain Pass Mine.
Coherent’s stock was up about 4% premarket.
“Cook has navigated this unprecedented tariff situation proving that he is 10% politician and 90% CEO and times like this he will be using his strong ties globally to make sure its smoother waters for Cupertino ahead despite concerns around AAPL’s growth initiatives with Trump heading down the “America First”/tariff path,” said Ives and his team.
The analysts noted that it is a good step in the right direction for Apple and it helps get on Trump’s good side after what appears to be a “tension filled” few months in the eyes of the Street between the White House and Apple.
The stock bounced on this relief with Apple now in a better standing position with Trump althoughchallenges remain, according to the analysts.
“The reality continues to be that producing iPhones in the US is unrealistic given the cost structure vs. Asia/India and remains a fairy tale concept in our view. Apple will invest in Macs, AI, and a host of other tangential initiatives, but NOT core flagship iPhones being built in the US,” said Ives and his team.