Slowing growth. Rising competition. Widening scrutiny.
Apple is falling flat in China and with investors, as the shine comes off of the once darling stock. Shares of the tech giant have declined 8.5% this year, wiping more than $300 billion from its market capitalization, and underperforming the S&P 500 and Nasdaq 100.
However, not all is lost. The stock correction is making Apple’s valuation more attractive, analysts say, and it’s not out of the question that the company wows the world again with new offerings.
Currently, Apple’s stock has fallen 14% from its December peak of $198.11, compared to the S&P 500’s 10% gain and the Nasdaq 100’s nearly 9% climb during the same time.
A number of factors have unnerved investors, including sluggish iPhone demand, intensifying Chinese competition, and heightened regulatory scrutiny, Needham analyst Laura Martin told Yahoo Finance Live.
The growing list of obstacles has prompted more than a few of Martin’s peers to become more bearish on the stock in the short-term. Goldman Sachs removed Apple from its Conviction List last month, while Barclays, Piper Sandler, and Redburn Atlantic were among firms that have downgraded the stock in 2024.
Earlier this week, Loop Capital analyst Ananda Baruah cut his price target on Apple to $170 from $185, and lowered his earnings estimates, writing in a client note that lackluster demand, “softer fundamentals,” and competition from Huawei and Xiaomi are having a “material impact.”
“iPhone unit shipments are simply too soft,” Baruah wrote. “We currently believe that both Street iPhone units and revenue [estimates] could be 20% too high, and that Wall Street’s overall revenue and EPS [estimates] could be 10% too high.”
Baruah expects Apple’s annual revenue and earnings to decline in 2024 — which has not happened since 2016.
SHANGHAI, CHINA – MARCH 23, 2024 – Customers shop at Apple’s flagship store, the world’s second largest and Asia’s largest, in Shanghai, China, March 23, 2024. (Photo credit: CFOTO/Future Publishing via Getty Images) (Future Publishing via Getty Images)
And Apple’s woes…
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