Goldman Analyst Upbeat on Apple’s Vision Pro Headset (NASDAQ:AAPL), Despite High Price

Apple (NASDAQ:AAPL), at its Worldwide Developers Conference, unveiled the much-awaited augmented reality headset – Vision Pro – for $3,499. While the fate of the headset is yet to be determined as the product will not be available until early next year, the device’s high price might affect its early adoption, says Goldman Sachs analyst Mike Ng. Nonetheless, the analyst is bullish about the product’s long-term prospects.

After a long hiatus, the headset marks the tech giant’s entry into a new major product category. While the device’s announcement was largely anticipated, its higher price came as a surprise. 

Apple Vision Pro Price

The analyst is upbeat about the prospects of the product and the Vision Pro app ecosystem and expects it to contribute meaningfully to Apple’s financials in the long term. 

However, he noted that the retail price of $3,499 is higher than Goldman Sachs’ estimate of $3K. Thus, the analyst believes that the higher retail price point might “limit near-term adoption.”

The analyst added that his hypothetical model assumes Apple will ship five million headsets in Fiscal 2024. Moreover, it would ship 8-13 million units between Fiscal 2025 and Fiscal 2028. 

Will Apple Vision Pro Bring Profit to Apple?

Coming to the financial impact, the analyst’s hypothetical model assumes that the device could bring in $13-$25 billion in annual sales between Fiscal 2024 and Fiscal 2028. In addition, he expects the product to “breakeven to LSD% (low single-digit percentage) EPS accretion over time as Product gross margins scale and higher margin Services contribute.”

The AR (Augmented Reality)/VR (Virtual Reality) segment has been challenging for most companies and disappointing so far. However, the analyst sees Apple succeeding in the AR/VR industry with its headsets. He expects AAPL to benefit from its large iPhone user base, a solid “track record of success in consumer hardware,” compelling content, and robust features.

What’s the Prediction for Apple Stock?

Apple stock has gained nearly 39% year-to-date, thanks to the solid demand for products and strength in services revenue. Despite the recent gains, AAPL stock sports a Strong Buy consensus rating with 22 Buy, five Hold, and one Sell recommendations. 

However, due to the recent appreciation in AAPL stock, analysts’ average price target of $184.89 implies 2.96% upside potential. 

According to TipRanks’ data, Krish Sankar of TD Cowen is the most accurate analyst for Apple stock. Copying Sankar’s trades on AAPL stock and holding each position for one year could result in 96% of your transactions generating a profit, with an average return of 51% per trade.