Apple has 5 'underappreciated' catalysts that could boost the stock: Morgan Stanley
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Apple (NASDAQ:AAPL) is the world's most valuable company with a market cap approaching $2.4T, but investment firm Morgan Stanley said on Friday the tech giant has five "underappreciated" catalysts that could boost the stock higher over the next 12 months.
Analyst Erik Woodring, who rates Apple (AAPL) shares overweight, said the company could benefit from a boost in growth both for the iphone and Services, gross margins near record levels, two new product launches and the potential for an iPhone subscription service. 
"Combined, we believe the first 4 of these 5 catalysts have the potential to drive a re-rating in Apple shares toward our new sum-of-the-parts driven $180 price target, with the launch of a hardware subscription program key to unlocking our $230 LTV-driven bull case valuation," Woodring wrote in a note to clients.
Concerning the iPhone, Woodring noted that pent-up demand should boost "above consensus" shipments in fiscal 2024, even if shipments are forecast to decline 9% year-over-year in fiscal 2023 to 218M shipments.
Including an estimated longer replacement cycle, now believed to be 4.4 years, up 0.7 years from a recent survey, Apple's (AAPL) iPhone business may start to see a rebound in fiscal 2024 as production normalizes, consumer spending recovers and a new iPhone launch unlocks "pent up demand," Woodring explained.
Woodring also noted that Apple's (AAPL) Services business could see double-digit revenue growth in fiscal 2023 and 2024, thanks to the company's installed base, rising growth in the App Store and payments from Google (GOOG) (GOOGL) to be its default search engine, as well as easing foreign exchange headwinds and recent price increases.
The analyst also noted that gross margins could see roughly 150 basis points of upside compared to analyst estimates in both fiscal 2023 and 2024, thanks in part to easing foreign exchange headwinds and continued easing of costs in Apple's (AAPL) supply chain over the next two years.
"This analysis suggests to us that the decade high 43.5-44.5% gross margin guidance in the March Q is still 2-3 points below where we see gross margins peaking in the next 2 years," Woodring added. 
Apple (AAPL) is getting ready to unveil its widely discussed mixed reality headset, perhaps as soon as June, as well as the iPhone 15 in the fall. Woodring stated data has shown that Apple (AAPL) shares have outperformed "the S&P by 20 points, on average, in the 6-9 months ahead of an iPhone launch, driven by [multiple expansion] ahead of cycles that generate above-average iPhone revenue growth."
Additionally, Woodring noted that a hardware subscription launch, which has been discussed in the past, could add as much as $1T to the company's market cap.
Apple (AAPL) shares rose 2.5% in early Friday trading.
On Thursday, investment firm Jefferies said Apple (AAPL) is seeing only a "limited" impact from global economic worries.