- Apple’s (AAPL) stock rose 0.6% to $206.28 on Thursday, underperforming the Nasdaq’s (^IXIC) 300-point rally, as Bank of America (BAC) cut its price target by $10 to $240, citing tariff costs and delayed AI features.
- Despite a ‘Buy’ rating, BofA lowered long-term sales forecasts for Apple due to complex supply chain costs and AI-driven Siri delays, though it expects tariff-driven sales lift in the upcoming earnings report next Thursday.
- Apple shares have declined over 17% in 2025, lagging the S&P 500 (^GSPC) by nearly 10%, with retail investors showing net selling while favoring stocks like Tesla (TSLA) and Nvidia (NVDA), indicating cautious sentiment.
Apple Inc.’s (AAPL) stock edged up 0.6% to $206.28 on Thursday, trailing the Nasdaq’s (^IXIC) robust 300-point surge, as investor sentiment grappled with tempered optimism from Wall Street. Bank of America (BAC) analysts, while maintaining a ‘Buy’ rating, reduced their price target by $10 to $240, citing tariff-related margin pressures and potential demand weakness due to delayed AI features, such as an AI-enabled Siri. The stock’s modest gain reflects broader market strength, but Apple’s year-to-date decline of over 17% significantly lags the S&P 500 (^GSPC), which has outperformed it by nearly 10%.
As Apple prepares to report earnings next Thursday after the close, Bank of America anticipates a tariff-driven sales boost in the recent quarter from accelerated purchases, yet they lowered long-term sales forecasts due to increased supply chain costs and AI feature delays. These challenges highlight the complexities Apple faces in navigating global trade tensions, particularly with its supply chain heavily tied to China, where tariffs could inflate production costs. The company’s position among the ‘Magnificent Seven’ tech giants underscores the high expectations for its earnings, especially as competitors like Tesla (TSLA) and Nvidia (NVDA) see stronger retail investor interest. Research firm Vanda noted on Wednesday that retail investors have been net sellers of Apple stock, signaling “capitulation-lite” behavior, though a broader sell-off remains unlikely in the near term. This contrasts with continued net buying in peers like Tesla and Nvidia, reflecting shifting retail confidence.
Apple’s underperformance this year, despite its technological prowess and brand strength, points to vulnerabilities tied to macroeconomic pressures and innovation timelines. The delayed rollout of advanced AI capabilities, critical for sustaining iPhone demand, adds uncertainty to its growth trajectory. As the earnings report looms, investors will scrutinize Apple’s ability to balance tariff impacts with its strategic push into AI and services. BofA’s price reduction underscores the cautious outlook, with Apple’s stock resilience on Thursday masking deeper concerns about its path forward in a volatile market environment.
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