The No. 1 ‘set and forget’ stock in tech hardware for next year? You guessed it. - MarketWatch

“While we recognize investors are acrophobic astir the near-term iPhone
outlook fixed manufacturing disruption issues successful China, we spot immoderate headwinds arsenic transitory and investors should stay focused connected the semipermanent opportunity,” Evercore’s Amit Daryanani wrote successful a Friday enactment to clients.

In 2023, the smartphone elephantine has an accidental to marque advancement connected its “moonshot” endeavors, helium continued.

“We consciousness assured that Apple is moving connected AR/VR [augmented reality/virtual reality] products and this volition apt beryllium the adjacent large hardware product,” helium wrote. “On the bundle side, Apple is making large moves successful advertizing and payments that are mostly underappreciated by investors.”

See also: Apple faces hazard of ‘perishable demand’ for iPhones, analysts say

In Daryanani’s view, Apple’s trove of patents and its signifier of caller acquisitions suggest a “high probability” of a caller instrumentality motorboat successful the adjacent six to 12 months. That could beryllium a headset supporting augmented and virtual world oregon the rumored “Apple Glass” glasses.

“Conservatively, should the AR offering person a comparable trajectory arsenic Apple Watch, it could lend $18.1 cardinal to income and 19 cents EPS [earnings per share] astatine scale,” helium said.

In payments, Apple’s opportunities see gaining traction with the Tap to Pay connected iPhone initiative, which lets radical crook their phones into payment-acceptance devices, and expanding the fig of merchants that judge Apple Pay online.

“Apple’s involvement successful fiscal services makes a batch of sense, arsenic a large portion of their integer services strategies revolves astir gathering ‘toll booths’ passim the ecosystem,” Daryanani wrote of the initiative, which could rake successful $11.6 cardinal successful gross by fiscal 2026, per his estimates.

Read: Apple readying immense alteration arsenic a effect of European ineligible push, study says

Other names Daryanani likes wrong hardware and networking are Amphenol Corp. APH, -0.63%, CDW Corp. CDW, -1.59%, Arista Networks Inc. ANET, -1.53%, Cisco Systems Inc. ANET, -1.53% CSCO, -0.71%, Juniper Networks Inc. JNPR, -1.58%, Pure Storage Inc. PSTG, -1.58% and Vertiv Holdings LLC. VRT, -0.83%.