Evercore ISI Hikes Apple Price Target to $365: Bull Case Now $500 on Services Compounding
Evercore ISI Hikes Apple Price Target to $365: Bull Case Now $500 on Services Compounding
David MoadelThu, May 14, 2026 at 3:12 PM UTC
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Evercore ISI raised its Apple (AAPL) stock price target to $365 (with a $500 bull case) from $330, betting on earnings and free cash flow compounding at low-to-mid teens pace without meaningful iPhone unit growth.
Evercore’s bull thesis hinges on three compounding levers: Services revenue growth, premium iPhone mix shift driving average selling price gains, and aggressive capital returns, supported by Apple’s 2.5B installed-device base and AI distribution advantage.
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Evercore ISI raised its price target on Apple (NASDAQ:AAPL) to $365 from $330 while reiterating its Outperform rating, and the firm flagged a bull case scenario of $500 tied to a Services compounding thesis. Apple stock trades near $299, just below its 52-week high of $300.92.
Evercore's case: Apple can compound earnings and free cash flow at a low-to-mid teens pace even without meaningful iPhone unit growth. The price target raise signals confidence in durable, high-margin recurring revenue.
Ticker
Company
Firm
Action
Old Rating
New Rating
Old Target
New Target
Apple Inc.
Evercore ISI
Price Target Raise
Outperform
Outperform
$330
$365 (bull case $500)
The Analyst's Case
Evercore's thesis rests on three compounding levers: Services revenue growth, average selling price tailwinds from a premium iPhone mix shift, and aggressive capital return. The firm argues that this combination delivers attractive returns even if iPhone units grow only "modestly."
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Services is the engine. Apple posted an all-time Services revenue record of $30.976 billion, growing 16% year over year at a Services gross margin of 77%. That high-margin recurring revenue stream, spanning the App Store, iCloud, Apple Music, Apple TV+, Apple Pay, AppleCare, and advertising, drives the bull case path to $500.
Company Snapshot
Apple ended its March quarter with revenue of $111.184 billion, up 17% year over year and diluted EPS of $2.01, beating consensus by 4%, extending its streak to eight consecutive quarters of EPS beats. The installed base exceeds 2.5 billion active devices, giving Apple a massive monetization surface for Services and Apple Intelligence.
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The board authorized a $100 billion buyback program and a 4% dividend increase, reinforcing the capital return leg of the thesis. Together, these actions extend Apple's multi-year track record of returning cash to shareholders while supporting EPS growth.
Why the Move Matters Now
Apple stock has rallied 16% over the past month and 41% over the past year, leaving consensus analyst target at $305.28. Evercore's $365 base case sits well above consensus, and the $500 bull case implies meaningful optionality not yet reflected in sell-side expectations.
AAPL stock trades at a P/E ratio of 36x with a forward P/E ratio of 33x, supported by 22% quarterly earnings growth. Wedbush noted that roughly 20% of the world's population could access AI through an Apple device, a distribution advantage underpinning the upgrade cycle thesis.
What It Means for Your Portfolio
For long-term investors, the Evercore price target raise reinforces Apple's profile as a compounder rather than a hyper-growth story. The bull case to $500 requires Services to accelerate, an AI-driven upgrade cycle to materialize, and the capital return machine to keep humming.
The bear case deserves equal weight. Regulatory pressure on the App Store, slower iPhone upgrade cycles in saturated markets, and competitive pressure on the AI distribution thesis could cap multiple expansion. Apple trades at scale, and underperformance can occur even when fundamentals are strong.
A measured approach makes sense for prudent investors. Apple stock offers durable cash flow, a fortress balance sheet, and a clear capital return framework, yet position sizing should reflect that much of the Services compounding story is already priced into a name flirting with all-time highs.
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Source: “AOL Money”
