A sixth Wall Street analyst has recommended selling Apple stock. This is a record since 2012
Jefferies has joined the ranks of Apple skeptics / Photo: Kittyfly / Shutterstock
Analysts at Jefferies downgraded their recommendation on Apple shares from “hold” to “sell” (Underperform rating) and lowered their price target from $285.6 to $263.7, according to Bloomberg. The new target price is nearly 16% below Apple’s market value at the close of trading on August 7.
According to Bloomberg, six investment banks and firms are currently recommending that investors sell Apple shares. This is the highest number since 2012, the agency notes.
What Jefferies Fears
Jefferies analyst Edison Lee is concerned about the iPhone’s prospects, particularly Apple’s ability to raise the average selling price (ASP) of its devices over time. An analysis of the supply chain shows that the company “canceled the release of a glass-bodied iPhone for its 20th anniversary due to a high defect rate,” he wrote. “This suggests that introducing new form factors for the iPhone to raise the average selling price is proving more difficult than expected,” the analyst noted.
The foldable iPhone, which Apple is expected to unveil in September, “will now be the sole key driver of growth in average selling price and margins” in the coming years, Li wrote. However, skyrocketing prices for key components, such as memory chips, will force Apple to set a high price for the device. Such an expensive smartphone will most likely remain a niche product, the Jefferies analyst noted.
Apple shares fell 2.2% during trading on August 10. Compared to their July peak, they have lost 10% of their value. The sell-off began after Apple released its quarterly earnings report, in which the company issued a weak sales forecast due to a shortage of components.
What Other Analysts Are Saying
In July, KeyBanc Capital Markets downgraded its rating from “hold” to “sell,” citing concerns regarding both demand and valuation.
According to MarketWatch, fewer than 65% of analysts recommend buying Apple stock, and this percentage is significantly lower than that of other tech giants. For example, more than 90% of investment firms recommend Microsoft, Amazon, and Nvidia.
This article was AI-translated and verified by a human editor
