Analyst predicts 27% surge in Apple stock despite record valuation

iPhone event Source: Apple

What you need to know

Dan Ives is back with another big prediction for Apple.
He says Apple could grow by another 27%.
He also says Apple's services business is worth more than $700 billion.

Analyst Dan Ives of Wedbush is back with another bullish prediction for where Apple's stock is headed.

Even after Apple this week became the first US-listed company to hit a $2 trillion market value, it could still surge higher in the coming months, according to Daniel Ives of Wedbush.

In a note Friday, Ives reportedly said that Apple still has "a lot of gasoline left in the tank," especially given a nearing iPhone 12 supercycle. Ives gave Apple's stock an "outperform" rating, and a target valuation fo $515, with a best case scenario of $600, a valuation that woudl mark a 27% increase on the current price.

Ives says that Apple has a "once in a decade" opportunity, given that roughly 350 million iPhone users are in an upgrade window. Ives believes China will be a key market in this area, estimating that 20% of iPhone upgrades in the coming year will come from China.

Ives also had high praise for Apple's services:

Baked into Ives' bull thesis is Apple's services business, which he values between $700 billion to $750 billion and thinks will generate more than $60 billion annual revenue in 2021. Ives also sees growth in wearables booming, and estimates AirPods unit sales of 90 million in 2020 versus 65 million in 2019.

Ives believes the iPhone 12 will be one of the most significant product cycles ever for Apple, and that many people on "the Street" are underestimating demand.

Apple became the first U.S. comapny to hit a $2 trillion market capitalization earlier this week.