By Noel Randewich
SAN FRANCISCO (Reuters) - Shares in Apple (O:AAPL) surged 6.9% on Monday, helped by a broad Wall Street rebound and an upgraded rating from an analyst who said the iPhone maker's stock had become oversold following last week's rout related to fears about the new coronavirus.
Oppenheimer upgraded its rating on Apple to "outperform" from "perform", saying the Cupertino, California, company was more prepared than its competitors to absorb the impact of the global health crisis. Apple's stock tumbled over 16% from its record high on Feb. 12 through Friday.
Monday's bounce put Apple's stock on track for its largest one-day gain since December 2018. The company relies heavily on China, where the coronavirus has hit production at its factories and kept consumers away from retail shops.
"Our limited checks indicate Apple will prove more resilient than others as firms worldwide navigate changing supply chains and customer demand uncertainty," Oppenheimer analyst Andrew Uerkwitz wrote in a client note.
The Philadelphia Semiconductor Index (SOX), which includes the stocks of many of Apple's suppliers, rebounded 1.9%. U.S. semiconductor companies rely more than most other U.S. companies on China for their sales.
More broadly, the S&P 500 jumped 2.8% as investors bet that monetary stimulus from central banks would cushion the economic impact of the coronavirus.
Optimism about Apple's increasing focus on recurring revenues from services including music, videogames and video have pushed its stock up 66% over the past year, even after last week's selloff. The shares are now trading at about 19 times expected earnings, down from a decade-high PE ratio of over 23 in mid-February, according to Refinitiv Datastream.