Apple stock rises after DA Davidson says shares could hit $300 in five years

Shares of Apple Inc. are up 1.3% ahead of the company's fiscal second-quarter earnings report, which is due out Tuesday after the close. DA Davidson analyst Tom Forte initiated coverage of Apple's stock with a buy rating prior to the release. "While the company faces a number of significant challenges, including the continued rise of Amazon and Google its high margin and large sales figures enable the company to generate significant free cash flow, which it increasingly returns to shareholders via buybacks and dividends, but also affords it a tremendous war chest if it needed to make strategic acquisitions to bolster its competitive standing," Forte wrote. He said that Apple hits on a number of key trends in retail, including the importance of having strong international and mobile presences. Forte has a $220 price target on the stock for the next 12 to 18 months and a $300 target for five years out, which is about 80% above current levels. Apple shares are up 14% over the past 12 months, while the Dow Jones Industrial Average is up 15%.