After a relatively muted run at the stock market, Apple (AAPL) investors were likely looking for a reason to feel better ahead of earnings, and Bank of America may have just given them one.
The firm reiterated its Buy rating, kept its $325 price target intact, and forecasts a healthy 23.4% upside from Apple’s $263.40 share price at the time of the note.
That’s substantial upside heading into another closely watched fiscal Q2 earnings report scheduled for release on April 30, 2026.
For Apple stock investors, the big takeaway is that BofA analysts view it as a premium story in an otherwise messy market.
Services remain a critical pillar, but the product cycle matters a ton as well.
However, perhaps a far more practical new engine is in place for Apple, as it has now pushed much deeper into AI.
That’s exactly where the M5 chip family comes in.
BofA analysts believe Apple’s latest piece of silicon is a major step forward for on-device inference, quicker response times, improved privacy, and lower cloud-related expenses.
Hence, Apple isn’t the loudest story on Wall Street, but according to Bank of America, it might actually be the smartest.
Wall Street price targets for Apple stock
According to Seeking Alpha, Wall Street’s consensus price target for Apple stock is $297.46, suggesting 10% upside from current levels.
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The targets range from $205 on the low end to $350 on the high end, suggesting a fairly wide upside for Apple.
For perspective, Apple stock isn’t trading cheap by most measures.
Despite the recent pullback, it’s trading at a forward price-earnings multiple of almost 32 times, roughly 33% above the sector median, according to Seeking Alpha.
- BNP Paribas: $300.
- Bank of America: $325.
- UBS: $280.
- Wedbush: $350.
- Morgan Stanley: $315.
- Goldman Sachs: $330.
Alberto Rodriguez/Variety via Getty Images
Why BofA still likes Apple
Bank of America views Apple as the “ultimate edge AI play,” which means the company’s trying to make AI useful right on the device.
That’s like having a robust engine under the hood instead of having to tow your car each time you need more speed.
Related: Wall Street firm drops shocking verdict ahead of Tesla earnings
The M5 family represents that strategy effectively taking shape.
BofA says M5 turns AI story into a broader team effort.
So instead of relying on a specific neural engine, Apple’s using its CPU, GPU, Media Engine, and memory system a lot more directly for inference.
The base M5 offers over 4-times GPU compute performance for AI compared to M4. At the same time, memory bandwidth jumps 30% to 153GB/s.
In fact, the higher-end versions push the limits even farther, with 307GB/s on M5 Pro and up to 614GB/s on M5 Max. So that’s like redesigning the entire checkout line, so tons more work gets done faster.
Consequently, Bank of America kept its buy rating on the stock based on a 32x multiple (based on the 2027 EPS estimate of $10.14).
BofA foresees EPS rising from $8.55 in 2026 to $9.74 in 2027, along with revenues jumping to $465.6 billion in 2026 and $523.1 billion in 2027, and product revenue growing 11% to $342.1 billion.
Throw in Apple’s resilient Services segment, boasting top-of-the-line margins, and the impact of Private Cloud Compute, and the bull case becomes even clearer.
Apple recent earnings performance and history
Apple’s most recent earnings report was posted on January 29, 2026, when it reported its Q1 2026 results.
In its Q1 earnings call, Apple dished out guidance for its upcoming quarter (fiscal Q2), forecasting revenue growth of 13% to 16%, gross margin of 48% to 49%, and operating expenses of $18.4 billion to $18.7 billion.
According to Seeking Alpha, consensus estimates point to a normalized EPS of $1.95, a GAAP EPS of $1.94, and revenue of $109.44 billion.
Moreover, over the last 90 days, 26 EPS estimates were revised upward, and 1 was revised downward.
Here’s how its recent earnings scorecards have fared over the past four quarters.
- FQ1 2026 (Dec 2025): EPS $2.84 (beat by $0.17); revenue $143.76 billion (beat by $5.23 billion, up 15.65% year over year).
- FQ4 2025 (Sep 2025): EPS $1.85 (beat by $0.08); revenue $102.47 billion (beat by $215.52 million, up 7.94% year over year).
- FQ3 2025 (Jun 2025): EPS $1.57 (beat by $0.14); revenue $94.04 billion (beat by $4.87 billion, up 9.63% year over year).
- FQ2 2025 (Mar 2025): EPS $1.65 (beat by $0.02); revenue $95.36 billion (beat by $652.32 million, up 5.08% year over year).
Risks to the thesis
- iPhone upgrade cycle disappoints: Apple’s bull case becomes a lot less compelling if the iPhone upgrade cycle meaningfully slows down. A big part of why BofA is leaning bullish on the tech giant is that consumers are continuing to scoop up new devices, particularly for Gen AI features. However, if we see sluggish spending or prolonged replacement cycles, things could get a lot more testy.
- Services cushion could thin out: BofA flagged slower App Store and licensing growth as immediate risks, especially if they see AI-powered search disrupting licensing sales or if legal pressures clip away at monetization ability.
- Margins are not bulletproof: BofA analysts talked about weaker gross profit numbers, Macs and iPads dropping back to pre-Covid levels, tariff pressures, and for Apple to consistently innovate quickly enough to justify a premium multiple.
Apple stock returns vs the S&P 500
- Over the past 1 week, Apple stock returned 3.74%, compared with 4.54% for the S&P 500.
- Over the past 1 month, Apple stock returned 6.29%, compared with 6.10% for the S&P 500.
- Over the past 6 months, Apple stock returned 7.11%, compared with 6.93% for the S&P 500.
- Year to date, Apple stock returned -0.60%, compared with 4.10% for the S&P 500.
- Over the past 1 year, Apple stock returned 37.19%, compared with 34.89% for the S&P 500.
- Over the past 3 years, Apple stock returned 63.55%, compared with 71.66% for the S&P 500.
Source: Seeking Alpha.