Apple has become a safe haven for investors amid waning AI hype

Another large-scale sell-off, affecting shares of artificial intelligence market leaders from Nvidia to Palantir, has bypassed one of the veterans of the technology sector. In a risk-averse environment, Apple's qualities of stability and predictability have once again become sought after by investors.

While the technology index Nasdaq 100 collapsed on November 6 by 1.9%, its constituent shares Apple lost only 0.1% in the main trading and then came out in the plus at the postmarket. The situation repeated the course of trading on November 4, when the securities of the iPhone maker rose slightly, despite a 2.1% drop in the index, Bloomberg noted.

Apple's stock is up just 8.4 percent this year amid a nearly 20 percent rise in the Nasdaq 100 - in part because investors doubted the company's ability to develop successful AI products. Now, however, that shortcoming has turned into an advantage of sorts: Apple is spending less on AI than other tech giants, but could still benefit as many users access neural network technology through its gadgets, according to Bloomberg.

"We're seeing enthusiasm for more speculative-grade securities waning - they've 'overheated' by becoming victims of their own success. And in a risk-averse environment, Apple's cash flow, stability and predictability are qualities that investors are now gravitating toward," Bloomberg quoted Cresset Wealth Advisors investment strategist Jack Eblin as saying.

Apple has been the smartphone market leader in the U.S. for years and is battling Samsung for global supremacy.

Morgan Stanley analyst Eric Woodring believes the iPhone maker has a chance to become a major player in the vast market for AI devices that interact with the physical world. "As AI and robotics transform the physical world, Apple can leverage its advantages - a vertically integrated business model, a base of more than 2.3 billion active devices and underappreciated robotics know-how - to become a leading player in the embodied AI segment," Woodring wrote.

Over the past month, Apple shares have risen more than 5%, while the Nasdaq 100 added 0.6%. In late October, the company's securities reached an all-time high thanks to renewed interest in the iPhone after the launch of sales of the new lineup. According to FactSet, Apple's consensus rating is "above market" (Overweight, consistent with a buy recommendation). The average target price of $282.5 per share, calculated by the service, implies a 4.7% year-over-year increase.

This article was AI-translated and verified by a human editor