Back to the Blog Main Page
01/08/24
72
Apple Stock May Move Down on Earnings
Lynx Equity Strategies’ analysts warned against overly optimistic expectations and said Apple stock might move lower after its June quarter earnings.
Apple stock has soared 31% over the last 3 months, outperforming the SPX at 10% and Qs at 12%, mainly due to a clear AI strategy and better-than-anticipated China sales.
Analysts however believe that current high expectations for fiscal year 2025 are not realistic.
Lynx Equity Strategies’ analysts stated the bulls raised FY25 expectations since the WWDC event to sky-high levels. They believed the bulls’ expectation of overall revenue up double digits and iPhone growth in the teens was not realistic.
They also pointed out that, the June quarter may see flat sales for Apple versus strong gains for domestic brands, unlike the March quarter where sales in China exceeded lower expectations.
Lynx Equity Strategies’ analysts also underline potential problems with Apple’s AI development compared to Google.
They noted that Apple’s progress in internal silicon development and LLM was behind that of Google. We were not surprised with Apple reporting that Apple Intelligence was trained on Google’s TPU.
They expect that Google’s AI capabilities, especially for Android, may outpace Apple’s offerings in the short term.
Lynx analysts were cautious about the short-term future despite maintaining their $240 price target for Apple.
Promotions
