Apple (AAPL) has started its latest iPhone refresh cycle on a strong note. Demand for the iPhone 17 looks solid, helped by a price cut on the base model. But top Jefferies analyst Edison Lee believes the stock is already pricing in this early strength. As a result, the five-star analyst downgraded Apple to Sell from Hold and lowered his price target slightly to $205.16 from $205.82.
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Lee warned that investor hopes for the iPhone 18 and Apple’s first foldable model are too high. He said the stronger demand for iPhone 17 is already reflected in Apple’s stock, and that has created “excessive expectations” for the next cycle.
It is worth noting that Lee ranks 478 out of more than 10,050 analysts tracked by TipRanks. He has a success rate of 64%, with an average return per rating of 33.50% over a one-year timeframe.
Weak Growth Ahead Despite Near-Term Boost
The analyst raised his iPhone sales forecast for FY25 to 7%, up from his earlier 5%. However, his outlook for FY26 and FY27 is far weaker, with growth estimates at just 1% and -1%.
Lee explained that two factors weigh on Apple’s future growth. Firstly, he expects a $100 price hike for the iPhone 18 Pro and Pro Max. Secondly, he is cautious on the foldable iPhone 18 Fold, which he expects to sell only 12.5 million units. He argued that Apple’s stock already reflects more than twice that level of demand each year, which he sees as unrealistic.
Overall, the analyst warned that Apple shares could underperform in the coming years, as long-term risks outweigh the short-term boost from the iPhone 17 launch.
Is AAPL a Good Stock to Buy?
On TipRanks, AAPL stock has a Moderate Buy consensus rating based on 19 Buys, 14 Holds, and two Sell ratings. The average Apple price target of $255.63 implies 0.99% downside potential from current levels. Year-to-date, AAPL stock has gained nearly 3.7%.
