According to JPMorgan, Apple faces a challenge as investors remain optimistic about the iPhone maker’s upcoming launch. Analyst Samik Chatterjee reiterated an overweight stance on the stock but cut his price target by $5 to $230. The company’s new guidance still points to a nearly 30% gain from Thursday’s close. “We believe that share price outperformance in the remainder of the year (particularly after strong outperformance in the first half of the year and underperformance between July and September) will depend on exceeding investors’ now low expectations for the iPhone 15 launch,” Chatterjee wrote in Friday’s statement. Apple is expected to unveil the new iPhone at a media event on Tuesday. Apple shares have slumped nearly 8.5% so far this quarter, with most of those losses coming this week after multiple reports suggested Chinese government employees could be banned from using Apple’s iPhones. Even if iPhone sales and volume expectations beat low investor expectations next week, the stock’s upside potential for the remainder of 2023 will be limited by Apple’s year-to-date outperformance and an earnings multiple that is about 61% higher than the second half of 2019, he said. This time could be comparable to a time when Apple’s shares outperformed by meeting or exceeding investors’ low expectations for the iPhone 11, he said. According to Chatterjee, given that the iPhone 15 does not include any significant upgrades, investors should expect that the average consumer will be largely driven by a desire to replace and/or upgrade their current models. A price increase for all iPhones rather than just the Pro models will encourage consumers to opt for higher-end devices, he added. However, despite near-term headwinds, the analyst maintained his “positive outlook” on Apple’s iPhone and services revenue and sees catalysts for accelerating revenue growth and upside potential. The stock is still up 36.6% for the year. “We see upside potential in several aspects of the business as well as financial assets that are still underappreciated by investors, namely the company’s shift to services, installed base growth, technology leadership and freedom of choice in capital use – all of which take us together “We expect double-digit earnings growth and a slight re-rating of shares,” Chatterjee said. — Michael Bloom contributed to this report.
https://www.cnbc.com/2023/09/08/jp-morgan-trims-apples-price-target-ahead-of-iphone-15-launch-next-week.html JPMorgan cuts price target on Apple stock ahead of iPhone 15 launch