Market Overview

4 Pressing Questions About Apple's Slumping Stock

4 Pressing Questions About Apple's Slumping Stock
Related AAPL
How The GDPR's Data Portability Rules Could Affect Client Churn
Skyworks Downgraded By Raymond James On Lack Of Upside Potential
U.S. companies, fed by tax savings, unveil buybacks at $6.1B a day (Seeking Alpha)

Apple Inc. (NASDAQ: AAPL) investors hoping that the unveiling of the new iPhone 8 and iPhone X this month would propel the stock to new all-time highs have been sorely disappointed. Instead, Apple stock is now down more than 7 percent since Apple’s iPhone event on Sept. 12.

4 Pressing Questions, Answered

IPhone bulls are now left with a lot of questions about the stock In a new note to clients Monday, Bernstein analyst Toni Sacconaghi provided answers to four of the most pressing questions about Apple:

1. What the heck is going on with Apple stock?

According to Sacconaghi, sentiment related to Apple stock has taken a hit due to three negative headlines since the iPhone launch. First, the Apple Watch 3 has gotten bad reviews. Second, rival Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL) bought HTC’s Pixel business for $1 billion, which some see as a threat to Apple. Finally, initial iPhone 8 preorder numbers have been on the soft side.

2. Is plenty of iPhone 8 supply a bad thing?

Sacconaghi said investors shouldn’t get too worked up about iPhone 8 availability. He said Apple may simply be building as much iPhone 8 supply as possible before it pivots to iPhone X production in coming weeks (see his track record here).

3. Are there any near-term positive catalysts to stop the bleeding?

Sacconaghi said iPhone X preorder numbers in late October, margin guidance for fiscal Q1 and a potential press release on the first 24 hours of iPhone X sales could all serve as bullish near-term catalysts.

4. When will fiscal 2019 become a concern?

Sacconaghi said it will take at least until the March quarter for investors to get a clear picture of the current iPhone cycle and its potential impact on the 2019 cycle.

Bernstein maintains an Outperform rating and $175 target for Apple.

Related Link: Why Apple Investors Shouldn't Worry About This Sell-Off

Latest Ratings for AAPL

May 2018BMO CapitalMaintainsMarket PerformMarket Perform
May 2018Canaccord GenuityMaintainsBuyBuy
May 2018BarclaysMaintainsEqual-WeightEqual-Weight

View More Analyst Ratings for AAPL
View the Latest Analyst Ratings

Posted-In: BernsteinAnalyst Color Long Ideas Price Target Reiteration Analyst Ratings Tech Trading Ideas Best of Benzinga


Related Articles (AAPL + GOOG)

View Comments and Join the Discussion!