Barclays, in a recent report, downgraded Apple, America’s largest company by market capitalization. Analysts at the bank identified a decline in the sales of iPhones and Mac computers as a cause for concern.
Tim Long, leading the team of strategists, revised the rating for Apple from Equal Weight to Underweight, setting a new price target of $160 (down from $161). The market responded to this news with a 2.3% drop in premarket trading, bringing Apple’s shares to $188.20.
With regards to iPhone 15 sales, Barclays’ sales checks revealed a sluggish demand in both China and developed markets. Although emerging markets showed some signs of strength, it wasn’t enough to offset the lackluster performance elsewhere. Additionally, Barclays cautioned that the growth in services like the App Store is expected to taper off this year.
Long and his colleagues emphasized the need for sustainable results going forward. They expressed concerns about the viability of maintaining multiple expansion while experiencing continuous periods of weak performance. Furthermore, they predicted that 2024 could bring more risks to Apple’s services sector.
Despite a successful 2023 where Apple’s stock surged by nearly 50%, investors are now faced with uncertainty about the future. The company recently encountered a setback due to a temporary U.S. ban on the sale of its latest Apple Watch, citing patent issues.
Apple, alongside other renowned companies such as Alphabet, Amazon, Meta, Nvidia, Microsoft, and Tesla, played a vital role in driving the stock market’s significant gains last year.
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