Apple Inc. (AAPL) is expected to suffer a $10 billion loss if it loses the outcome of its ongoing legal battle with Alphabet (GOOGL). According to analysts at Bank of America, Apple could lose up to $10 billion along with annual payments from Google if it doesn’t have to pay Apple for anything related to search.
“In our opinion, if Google is required to not pay Apple for anything related to search, Apple could lose $20 billion + half of its annual payments from Google,” Bofa analyst Wamsi Mohan wrote in an investor’s note on Monday. “This amount is described as part of Apple Services Revenue (as Google TAC), with a high final drop-through (a pure royalty type payment).” The analyst continued to repeatedly rated the stock’s purchases at a price target of $240.00. At the time of pressing, Apple (AAPL) stocks have fallen 3% over the past five days, trading at $202.
Bank of America gives Apple Stock ruling
Additionally, Bank of America analysts remain optimistic about the long-term growth driven by AI investments and solid finance. Despite the recent decline in apple inventory, fundamentals suggest a possible recovery in AAPL. Mohan went on to add that the decision in the Apple/Google lawsuit applies only to the US, and that Apple should be able to receive payments for search traffic sent to Google outside of the US. In this case, the investor may have a lifeline of AAPL stocks.
The iPhone developer posted a solid third-quarter earnings report that sent stocks higher, but can overturn those profits following the negative ruling of the lawsuit. Apple’s $1.57 per share earnings exceeded analysts’ estimate of $1.43, with revenues reaching $940.4 billion against the expected $8.93 billion. Additionally, Apple’s stock price increased 13.5% to $445.8 billion in iPhone sales.
Therefore, analysts are optimistic about Apple’s long-term growth, citing its solid financial and potential benefits of around 15%.
