Apple Stock (AAPL) Rebounds on Optimism Around AI

Apple (NASDAQ:AAPL) stock came under pressure for its slow progress in artificial intelligence (AI) advancements. Nonetheless, it rebounded and gained around 13.2% since it reported its Q2 financials on May 2. This recovery in AAPL stock reflects investors’ optimism around its AI initiatives.

Several media reports pointed out that Apple is working on integrating large language models (LLMs) and generative AI into its products, which will likely boost its hardware sales. Adding to investors’ optimism, Wedbush analyst Daniel Ives, who has a success rate of 85% on AAPL stock, expects the company to disclose its AI initiatives during the upcoming Worldwide Developers Conference (WWDC) on June 10. Moreover, he expects the tech giant to announce its partnership with OpenAI. 

Ives is bullish about Apple’s prospects and reiterated a Buy on May 24. He raised the AAPL stock’s price target to $275 from $250. 

Apple Lagged on AI Advancements

However, a recent Wall Street Journal report warbed that Apple’s cautious approach and focus on meticulous hardware and software integration have hindered its progress in the AI field.

Furthermore, while Apple is likely to introduce impressive AI capabilities during the WWDC event, it may not be able to match its peers such as Microsoft (NASDAQ:MSFT) and Alphabet (NASDAQ:GOOGL) in the near future.

Revamping Siri with AI

One AI initiative to anticipate is an enhanced Siri. Apple plans to revamp its Siri virtual assistant with AI features, enabling more precise voice command controls for individual app functions. This upgrade will incorporate LLMs and generative AI to enhance Siri’s capabilities and potentially boost device sales.

According to Bloomberg, this upgrade is part of Apple’s broader AI strategy, which may be detailed at the WWDC event. The new features could include voice memo transcriptions, website and notification summaries, automated message replies, AI-generated emojis, and advanced photo editing.

Is Apple a Buy, Hold, or Sell?

The full extent of AI features and capabilities Apple will unveil at WWDC are still unknown. Meanwhile, Wall Street is cautiously optimistic about AAPL stock.

Apple stock has a Moderate Buy consensus rating based on 22 Buys, 11 Holds, and one Sell recommendation. The analysts’ price target on AAPL stock is $207.72, implying 6.05% upside potential from current levels.

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