Jefferies Downgrades Apple Over Inflated iPhone Optimism

Apple Inc. (AAPL) stock drew investor attention on Friday after Jefferies revised its outlook on the tech giant, citing overly optimistic expectations surrounding future iPhone sales.

Analyst Edison Lee downgraded Apple’s stock to ‘Underperform’ from ‘Hold’ and slightly adjusted the price target to $205.16, down from $205.82, according to TheFly. 

Apple stock inched 0.7% lower in Friday’s premarket and was among the top five trending equities on Stocktwits. Retail sentiment around the stock remained in ‘bearish’ territory amid ‘low’ message volume levels. 

The revised forecast comes amid concerns that investor enthusiasm around upcoming iPhone models has already been priced into the stock. Lee highlighted that demand for the iPhone 17 benefits from a pricing strategy that avoids increases on higher-end models, specifically the Pro and Pro Max, while introducing what he described as an "effective price cut" on the base version. 

However, the analyst believes these factors have already inflated expectations, making the market overly confident in the upcoming upgrade cycle. The analyst also said that investor sentiment surrounding Apple’s rumored foldable iPhone, possibly the iPhone 18 Fold, is leaning too far toward the optimistic side. 

According to Lee, the company’s current valuation prices in an "overly bullish iPhone outlook”.

In September, several Wall Street firms suggested that lead times for iPhone 17 preorders were lengthening, especially for base models and the new Air variant, indicating customers are eager.

Apple had launched the new iPhone 17, iPhone Air with the A19 Pro chip, iPhone 17 Pro, and iPhone 17 Pro Max on September 9. Apple stock has gained over 2% year-to-date and over 13% in the last 12 months. 

Also See: QCLS Stock Surges 15% In Pre-Market Today, Inches Closer To $6 Mark

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