What Happened: “The real risk for AAPL is whether the threat of these devices from OpenAI compresses Apple’s multiple,” Munster wrote on X, highlighting concerns about the iPhone maker’s premium valuation amid intensifying AI competition.

Munster characterized the move as part of a generational technology shift comparable to the internet and smartphone revolutions. “Before AI, there was no real threat to Apple’s or Google‘s business,” he noted, emphasizing that OpenAI is “catalyzing this shift into something tangible.”

See Also: Bitcoin Clocks $110,000, Ethereum, Dogecoin Extend Gains: Well-Known Trader Peter Brandt Says BTC Could Gain Another 37% As Soon As August

Why It Matters: The acquisition triggered over 2% decline in Apple shares on Wednesday as investors weighed the competitive implications. Ive, who designed iconic Apple products including the iPhone, left the company in 2019 after nearly three decades.

However, Munster tempered concerns about Apple’s competitive position, citing the company’s ecosystem lock-in with an estimated 1.7 billion users across 2.35 billion active devices. “It’s going to take more than a great phone from OpenAI to get Apple users to walk away from a decade of investment in hardware and services,” he said.

The analyst suggested Alphabet Inc. (NASDAQ:GOOGL) (NASDAQ:GOOG) faces greater risk, noting that Google’s ecosystem integration is “not nearly as strong” as Apple’s hardware-software integration.

Apple’s stock has a negative price trend over the short to long term, but it performs well on quality metrics, according to Benzinga Edge Stock Rankings. Growth and momentum performance for AAPL are modest, and the company’s valuation seems low.

Image Via Shutterstock

Read Next:

• Jim Cramer Says Bonds Will ‘Overshoot And Then Settle,’ Predicts Turbocharged Economy From Budget Agreement

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.