Investing.com - Apple is sidestepping the selloff in the broader market after Morgan Stanley said the tech giant's broad user base could give it an edge over its rivals in the race to emerge as a leader in consumer health.
Apple's (NASDAQ:AAPL) foray into consumer health care could help the tech giant's plans to diversify its revenue base, easing its dependence on iPhone revenue growth, as the U.S. health care opportunity is estimated to be three times larger than the global smartphone market, Morgan Stanley said in a note Monday.
The bank's upbeat assessment of Apple's chances to emerge as a leader in consumer health is driven by the company's track record of disrupting industries.
"Health care is a market where Apple has the potential to lead digital disruption – much like what iTunes did for music or the App Store for mobile services," Morgan Stanley (NYSE:MS) said. "Based on what it has done over the last five years, we see Apple creating the building blocks of another ecosystem” that puts the consumer at the center.
Apple's move into health care comes at time when wearables and electronic medical records are enabling data to flow more freely between silos and stakeholders, the bank added. Apple's watch and iPhone positions the company as an "agent of change" in health care and a leader among tech companies entering the space.
While rivals such as Google and Amazon are ahead of Apple, boasting greater artificial intelligence capabilities, Apple's vast user base gives it a clear advantage that cannot be underestimates, Morgan Stanley said.
Morgan Stanley rates Apple as overweight with a price target $220.