The Dow Jones Industrial Average (^DJI -0.49%) was leading the stock market higher on Monday, up 1.05% at 11:35 a.m. EDT. The U.S. approved the emergency use of blood plasma obtained from recovered COVID-19 patients to treat the virus, and it is reportedly considering fast-tracking an experimental vaccine for use before the November election. This treatment news may be contributing to the rally.

Shares of Apple (AAPL 0.62%) got a boost on Monday after an analyst pointed to the company's ecosystem of products and services as a reason for a higher price target. One potential headwind: Apple's App Store policies are under attack as companies subject to its fees and restrictions speak out. Over the weekend, Microsoft (MSFT 1.22%) aligned itself against Apple in a court filing regarding Apple's battle with Epic Games. Microsoft stock was up slightly by late morning.

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Apple snags a higher price target

An early rally for Apple stock on Monday partly disintegrated by late morning following a price-target increase from an analyst at Morgan Stanley. Shares of Apple were up as much as 3.5% early in the day, but that gain had shrunk to around 1.1% by late morning.

Morgan Stanley analyst Katy Huberty pointed out that Apple stock trades at a lower valuation than some tech platforms and strong consumer brands. That may be true, but the absolute valuation is historically high. Apple stock currently trades for around 38 times earnings, the highest level in more than a decade.

Huberty justifies Apple's valuation by pointing to the company's ecosystem of products and services. The company has managed to grow revenue, earnings, and free cash flow in recent quarters despite a largely mature iPhone business. Apple isn't the growth stock it once was, but that doesn't mean that growth is off the table.

Morgan Stanley raised its price target on Apple stock from $431 to $520 and maintained its overweight rating. The new price target represents upside of around 4% from the current price.

One thing that will become clear in the coming quarters is exactly how much the company has benefited from economic stimulus measures passed in response to the pandemic. If Apple's recent growth isn't sustainable, the stock's lofty valuation may come under pressure.

Microsoft weighs in on Apple's battle with Epic Games

Apple stock is soaring despite one of its key moneymakers coming under fire. Last week, Epic Games managed to get its popular Fortnite game banned from the App Store after implementing a direct payment system to bypass Apple's fees. Epic filed a lawsuit in response to the ban, and Apple upped the ante by threatening to completely cut off Epic from Apple's development tools. Epic also develops the Unreal Engine, a popular game engine used by many third-party developers.

In a court filing, tech giant Microsoft argued that Apple's move to cut off Epic would hurt its games business: "If Unreal Engine cannot support games for iOS or macOS, Microsoft would be required to choose between abandoning its customers and potential customers on the iOS and macOS platforms or choosing a different game engine when preparing to develop new games."

Cutting off Epic would likely do damage to Apple's platforms, leaving game developers scrambling to either switch game engines or focus on other platforms. If Apple is forced to lower its App Store fees or relax its rules, due to either pressure from companies like Epic or antitrust action, the App Store won't be nearly as big of a cash cow in the future.

This App Store drama hasn't derailed Apple stock so far. Shares of the tech giant are up over 70% this year.