Apple maintained at Outperform as Wedbush says streaming service could attract 100M customers

Apple Inc (NASDAQ:AAPL) was reiterated at Outperform by Wedbush after the iPhone company announced video streaming, credit card, news and gaming services.

CEO Tim Cook, according to Wedbush, has an opportunity of capturing 100 million customers with its streaming content service over the next three to five years.

“Apple needs to tiptoe into this major strategic initiative as in our opinion the success on this front will play a vital role in the services growth at Cupertino for years to come,” Wedbush analyst Daniel Ives wrote in a research note Monday, referring to the new streaming service.

Shares of Cupertino, California, company climbed 1.4% to $191.38 in Tuesday’s Nasdaq trading as Wedbush maintained its 12-month price target at $215.

READ: With iPhone sales flat, Apple bets on TV, credit card, subscription services as new revenue stream

Apple tried to distance itself from Facebook Inc (NASDAQ:FB) and Google (NASDAQ:GOOGL), according to Wedbush, when it said its $9.99-a-month news service would have no “tracking capability” of what consumers were reading.

Wedbush said Apple’s credit card partnership with Goldman Sachs Group Inc (NYSE:GS) will have attractive features including cash back, a lower interest rate and no late charges.

A potential linchpin, according to Wedbush, is the introduction of Apple Arcade, a game subscription service that will include more than 100 games.

“We believe this service, which will launch in the fall, is a smart strategic foray into the gaming world that Apple could truly monetize over the coming years,” Ives wrote, adding that both Cook and Google are moving aggressively in a field that has been “disrupted and turned upside down” with the Fortnite worldwide gaming phenomenon.

Contact Dennis Fitzgerald at [email protected]

Story by ProactiveInvestors