Apple’s Stock Falls After Barclays Cuts Recommendation on iPhone Demand
Analysts See Few Reasons for the iPhone 16 to Be More Attractive
Topic
Details
Apple’s stock fell as much as 1.4% in pre-market trading in the United States on Tuesday after Barclays cut its recommendation on the stock to “underweight” and lowered its price target to $160 from $161, implying a decline of 17% over the next year.
In a note on Tuesday, analysts led by Tim Long wrote: “We expect a rebound after a year of earnings misses and outperformance versus analyst expectations. However, our view on demand for iPhone 15 sizes and models remains negative, and we see no features or upgrades that are likely to make iPhone 16 more attractive.”
The analysts also noted that China’s government crackdown on foreign-made devices could also weigh on Apple’s sales in China.
Expectations
Analysts see weak iPhone demand as a sign that the stock’s massive gains last year may not be repeated. Apple’s stock rose by about 50% to a record high in 2022, with investors betting that its flagship device would withstand economic slowdowns. However, concerns have arisen about whether the stock will be able to repeat those massive gains given increasing competition from the likes of Huawei and China’s government crackdown on foreign-made devices.
Barclays’ downgrade means that Apple’s stock now has five sell or equivalent ratings, according to data compiled by Bloomberg, compared to 34 buy ratings and 14 hold ratings. The average price target for the stock implies a return of just 3.6% over the next year.
Conclusion
Apple’s stock appears to be facing some challenges in the future,
as weak iPhone demand suggests that the stock’s massive gains may not be repeated
Apple’s Stock Falls After Barclays Cuts Recommendation on iPhone Demand