Apple at all-time high after Morgan Stanley calls stock 'top pick' for AI efforts

Apple's shares rose 2.5% to a record high on Mon after Morgan Stanley raised its price target on the iPhone maker's shares and designated the stock as a "top pick," citing the company's AI efforts as a boost to device sales.

In what was seen as a move to catch up with Alphabet's Google and Microsoft-backed OpenAI, the iPad maker last month unveiled Apple Intelligence, luring customers to upgrade their devices to be able to use the new technology.

Apple's shares, which have jumped nearly 20% this year, rose to USD236.30, giving the company a market value of USD3.62 trillion, the highest in the world.

"Apple Intelligence is a clear catalyst to boost iPhone and iPad shipments," Morgan Stanley analysts said.

The new technology is compatible with only 8% of iPhone and iPad devices and Apple has 1.3 billion units of smartphones currently in use by customers, the analysts said, adding that the company could sell nearly 500 million iPhones over the next two years.

Morgan Stanley, which previously expected Apple to sell between 230 million and 235 million iPhones annually over the next two years, raised its price target on the company's shares to USD273 from USD216.