Apple iCar Speculation Continues. How Tech and Auto Analysts See the Car.

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Speculation about an all-electric, self-driving car produced by Apple just won’t die.

Now Japanese car maker

Nissan Motor

(ticker: 7201.Japan) has denied reports that it is in talks to be the builder of an Apple-branded vehicle. The iCar has resulted in a lot of Wall Street research reports, but few hard numbers about what an

Apple

(AAPL) entry might mean for the global car business. What’s more, tech and car analysts have slightly different takes on what the Apple car means.

News of a potential Apple car surfaced in December. Those reports were taken seriously by both tech and car analysts because Apple has had car ambitions stretching back years—and because Apple is huge. The tech giant has a market capitalization roughly equal to the market cap of all car makers on the globe, combined. That includes the most valuable car company on the planet:

Tesla

(TSLA).

Hyundai Motor

(005380.Korea),

Kia Motors

(000270.Korea), as well as U.S. EV start-up

Canoo

(GOEV), have all been tied to Apple in reports. Nissan is the latest car company to be linked. Nissan stock fell almost 3% Monday after Reuters reported Nissan’s denial it was working with Apple.

Apple, and the car companies, haven’t commented on Apple’s car plans. Apple wasn’t immediately available to comment on Nissan reports on Tuesday.

Outside of temporary impacts on car companies directly linked to Apple, car stocks aren’t really reacting to iCar news. Crying wolf is one reason: Nothing concrete has come from repeated speculation. And of course, an Apple car would be years away—another reason auto investors aren’t too concerned for the moment.

That doesn’t mean an Apple car won’t matter, or that news of potential partnerships can be discounted. Wedbush analyst Dan Ives expects a formal announcement in 2021. “At this point it’s a matter of when, not if, Apple will enter the EV race over the next few years,” wrote Ives in a Monday research report. He assigns an 85% probability that Apple will make an announcement in three to six months and calls Hyundai and

Volkswagen

(VOW.Germany) his top two choices for an Apple partnership.

Hyundai has its own modular EV platform. That’s one reason Ives likes Hyundai as a possibility, although other auto makers, including

General Motors

(GM), have similar approaches to electric-vehicle development. Volkswagen, for its part, has big EV ambitions. It is also a large shareholder of

QuantumScape

(QS), which is pioneering solid-state, lithium anode EV batteries. Those batteries promise lower cost, better safety, faster charging, and more range. Both things could make Volkswagen attractive to a partner.

Ives covers mainly technology stocks. He covers Apple, rating shares outperform and has a $175 price target for shares. He also covers Telsa stock, rating shares Hold with a $950 price target for shares. Bernstein analyst Toni Sacconaghi, covers both as well. He rates Apple stock Hold and has a $132 price target for shares. He is more bearish on Tesla though. He believes an Apple car would make it harder for Tesla to meet its volume growth goal of 50% a year on average for the next few years. “The automotive market has historically been highly fragmented, with strong regional brands and preferences,” wrote Sacconaghi in a recent research report. “It is uncertain to us that amid massive new competition and entry, the market will ultimately become more consolidated and/or have one outsized winner.”

That’s bad news for Tesla in his mind. He rates Tesla shares Sell and has a $180 price target for the stock, well below where shares are trading.

Morgan Stanley analyst Adam Jonas covers cars and not Apple. But he is bullish on Tesla stock, rating shares Buy with an $880 price target. An Apple car entry could speed EV penetration, which would benefit all EV makers. In addition, Tesla “can iterate industry-leading battery technology for another four or five years before Apple may be on the scene,” wrote Jonas in a recent research report. “But at some point, today’s EV players must share the sandbox.”

More EV players, however, aren’t enough to shake his confidence in Tesla stock. In addition to Tesla, Jonas recommends stock in GM and supplier

Aptiv

(APTV) to get exposure to the EV theme.

RBC analyst
Joe Spak
also covers car stocks. He, like Jonas, rates GM and Aptiv stock Buy but rates Tesla stock Hold. The emergence of an Apple car, for Spak, highlights the need for car makers to adapt at faster rates. “Otherwise they could get left behind, whether it’s by Apple or someone else,” wrote Spak in a recent research report.

Overall, Wall Street appears to believe few things about the iCar: It will be a premium self-driving product, and will be built by an existing auto maker. It is good news for Apple stock, but it might not be that disruptive to the existing industry—initial volumes will be small, and it will boost consumer interest in EVs. What’s more, news of an Apple car will drive incumbents to improve. Time will tell if that turns out to be how the industry develops.

Apple car news, again, doesn’t appear to be hitting stocks all that much. Tesla stock is down 2.7% in midday trading Tuesday. Apple stock is down 1.7%. GM and Volkswagen shares are up a little. The

S&P 500,

for comparison, is down about 0.2% and the

Dow Jones Industrial Average

is up about 0.2%.

Write to Al Root at allen.root@dowjones.com