🐂 Not all bull runs are created equal. November’s AI picks include 5 stocks up +20% eachUnlock Stocks

Apple stock outlook cautious as KeyBanc sets cites on Iphone 16

EditorEmilio Ghigini
Published 09/07/2024, 13:16
© Reuters.
AAPL
-

On Tuesday, KeyBanc Capital Markets maintained its Sector Weight rating on Apple Inc. (NASDAQ:AAPL) stock, citing both an increase in iPhone 16 production forecasts and recent financial data. The firm adjusted its financial estimates for Apple's third fiscal quarter and the full years of 2024 and 2025 following new industry checks and metrics from its Key First Look Data (KFLD).

According to the latest KFLD report, Apple's Indexed Spending in June saw a month-over-month increase of 14%, surpassing the three-year average. This growth was attributed to stronger-than-anticipated results, continuing the positive trend observed in May. For the third fiscal quarter, the KFLD indicated that Indexed Spending declined by 5% quarter-over-quarter, which is less than the three-year average decline of 12%, largely due to the introduction of new products.

Despite the positive indicators, the firm noted that year-over-year results are still on the decline. Discussions with carriers have revealed that upgrade rates remain low, leading KeyBanc to consider current estimates for a rise in U.S. upgrade rates to be overly optimistic and premature. The firm expressed caution, suggesting that expectations for an uptick in growth late in the fiscal years of 2025 and 2026 might be too high.

KeyBanc also pointed out that Apple's stock is currently trading at approximately 24 times the firm's projected 2025 adjusted EBITDA. This valuation, according to KeyBanc, is too high to justify increased optimism or investment activity, leading them to maintain a cautious stance on Apple's near-term growth prospects. The firm's analysis suggests that the consensus on a growth inflection in the later part of fiscal year 2025 and into fiscal year 2026 may not be as imminent as some expect.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.