Despite outperforming the S&P 500 with a nearly 47% year-to-date increase, Apple (NASDAQ:AAPL) is facing scrutiny from UBS. The team, led by analyst David Vogt, downgraded the tech giant from Buy to Neutral, attributing this to softer iPhone and services growth, lower demand in developed markets, and a hefty market premium. UBS expects a decrease in iPhone unit growth by 1%-2% and Mac revenue to drop by 3%-5% in the second half of the year. Even with a revised price target of $190, UBS sees a less than 5% total shareholder return as insufficient to uphold a Buy rating given these weaker fundamentals. As a result, AAPL stock is trading slightly lower at the time of writing.
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Nevertheless, optimism surrounds Apple due to its robust financial standing, share buybacks, and solid revenue sources. Its recent product launch at the Worldwide Developers Conference, the Vision Pro headset, has been well-received. However, D.A. Davidson argues that the positive impact of this launch is already reflected in the current share price.
analysts have a Strong Buy consensus rating on AAPL stock based on 22 Buys, seven Holds, and zero Sells assigned in the past three months, as indicated by the graphic above. Furthermore, the average price target of $189.17 per share implies 3.23% upside potential.
