Apple Stock in Focus Ahead of Expected iPhone 17 Reveal
Cupertino, CA – september 8, 2024 – Investors are weighing the potential impact of Apple’s anticipated next-generation iPhone unveiling next week, with expectations centering on a important design overhaul – the first in approximately five years. While the event could inject fresh momentum into the tech giant, Wall Street remains cautiously neutral on Apple (AAPL) stock, citing valuation concerns and a lukewarm reception to its recent foray into artificial intelligence.
Apple stock has substantially outperformed the S&P 500 Index ($SPX) over the past five months,gaining over 40% since early April. The iPhone 17 redesign is predicted to possibly benefit AAPL stock in the latter half of 2025. A new aesthetic could revitalize consumer demand and help Apple counter increasing competition from Samsung and google (GOOGL) in the premium smartphone market.
The redesign may also divert investor attention, at least temporarily, from concerns regarding Apple’s position in the rapidly evolving AI landscape. Improved supply chains and robust global rollout plans could trigger an upgrade cycle, boosting revenue, margins, and overall investor sentiment.
However, despite the upcoming product launch, MoffettNathanson maintains a “Neutral” rating on Apple stock, with a $225 price target – suggesting potential downside of over 5%. Founder and senior analyst Craig Moffett argues that a valuation “north of 30x next year earnings is still, in our view, too rich for any company with good but not-great earnings growth.”
Moffett also described Apple Intelligence as “mostly a dud” in a recent research note, further contributing to his cautious outlook. Additionally, Apple’s reliance on discounts to mitigate market share losses in China could potentially compress margins and negatively impact AAPL shares in the short term.The broader analyst consensus reflects similar reservations.While AAPL shares currently hold a “Moderate Buy” rating, the average target price of $235 indicates limited upside potential.