Health care could bring in over $15 billion for Apple Inc. (NASDAQ:AAPL) by 2021 and up to $313 billion by 2027

Health care could bring in over $15 billion for Apple Inc. (NASDAQ:AAPL) by 2021 and up to $313 billion by 2027

Health care could bring in over $15 billion for Apple Inc. (NASDAQ:AAPL) by 2021 and up to $313 billion by 2027

Apple’s opportunity in health care is so large with the Apple Watch that the company should soon generate tens of billions of dollars a year in annual revenue from wearables and health services, according to a new report from Morgan Stanley.

It’s a nascent space for Apple and hard to predict how much money the company will make from health services as it potentially dives deeper into monitoring features such as blood glucose and blood pressure, the investment bank wrote on Monday.

Morgan Stanley’s estimate is that health for Apple will top $15 billion in sales by 2021, based on the popularity of the Apple Watch and its health features, like monitoring heart rate and steps. The very high end of Morgan Stanley’s estimate range is $313 billion by 2027, which is a particularly lofty figure since Apple’s total revenue last year was $266 billion.

Beyond consumer device sales, the company has started to sign deals with health insurers who are willing to pay for some portion of the Apple Watch on behalf of their members. Apple has already inked that type of partnership with Aetna. It’s also currently in talks with private Medicare plans, which could mean increased access to the Apple Watch for seniors.

“Medicare has the most concentrated pools of money and is the least complicated to navigate,” the Morgan Stanley analysts wrote.

The company also has revenue potential in the electronic medical records market.

IPhone users will have access to the Apple’s health app, which allows customers to pull together medical information from dozens of hospitals and clinics. In its current form, the feature is designed for consumers, because it’s a huge challenge for people to aggregate their lab reports, immunization records and more.

Morgan Stanley said it could turn into a real business if Apple starts pulling together data and selling reports to health systems. To maintain consumer trust, Apple would have to effectively pitch it as a way for hospitals and clinics to gain insights into broad populations while protecting the data of individual patients.

The report listed five other things Apple could do that would generate a lot of investor interest:

  • Introduce new medical wearables.
  • Add medical grade monitoring, like sleep, blood glucose or blood pressure.
  • Make the Apple Watch readily available through insurance companies as a benefit that’s reimbursed.
  • Start its own employer joint venture or join a group like Haven, which currently consists of Amazon, J.P. Morgan and Berkshire Hathaway. Apple already runs its own employee medical clinics, dubbed AC Wellness.
  • Acquire a health care company.

Apple has publicly stayed mum about those topics, and a company spokesperson declined to comment on the report.

Overall, the bias in prices is: Upwards.

Note: this chart shows extraordinary price action to the upside.

By the way, prices are vulnerable to a correction towards 182.85.

The projected upper bound is: 208.39.

The projected lower bound is: 193.50.

The projected closing price is: 200.95.

Candlesticks

A big white candle occurred. This is generally considered bullish, as prices closed significantly higher than they opened. If the candle appears when prices are “low,” it may be the first sign of a bottom. If it occurs when prices are rebounding off of a support area (e.g., a moving average, trendline, or retracement level), the long white candle adds credibility to the support. Similarly, if the candle appears during a breakout above a resistance area, the long white candle adds credibility to the breakout.
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 29 white candles and 21 black candles for a net of 8 white candles.

Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 96.0031. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 11 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 76.40. This is where it usually tops. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 10 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 147.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 10 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 2 period(s) ago.

Rex Takasugi – TD Profile

APPLE INC closed up 3.100 at 200.100. Volume was 26% below average (neutral) and Bollinger Bands were 25% narrower than normal.

Open High Low Close Volume___
196.420 200.230 196.340 200.100 25,881,696

Technical Outlook
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 192.73 178.56 190.77
Volatility: 13 27 39
Volume: 26,141,542 28,611,460 33,433,490

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

APPLE INC is currently 4.9% above its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect moderate flows of volume into AAPL.O (mildly bullish). Our trend forecasting oscillators are currently bullish on AAPL.O and have had this outlook for the last 50 periods. Our momentum oscillator is currently indicating that AAPL.O is currently in an overbought condition. The security price has set a new 14-period high while our momentum oscillator has not. This is a bearish divergence.

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