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Investing.com - Goldman Sachs has reiterated its Buy rating and $253.00 price target on Apple (NASDAQ:AAPL) despite recent data showing declining smartphone shipments in China. The target sits well below the Street’s high estimate of $300, while InvestingPro analysis suggests the stock is currently overvalued, trading at 32.7x earnings with a market cap of $3.14 trillion.
May 2025 foreign-branded phone shipments in China declined 10% year-over-year to 4.5 million units, according to the China Academy of Information and Communications Technology (CAICT). While this represents a deceleration from April’s 1% growth, foreign brands outperformed the broader Chinese smartphone market, which fell 22% year-over-year to 23.7 million units. Despite market challenges, Apple maintains strong fundamentals with $400.37 billion in revenue and a "GOOD" financial health score according to InvestingPro, which offers 12 additional key insights about the company’s performance.
This marks the first month since May 2024 that foreign brands have outperformed the overall Chinese market. Goldman Sachs attributes this relative strength to increased discounting by Apple ahead of China’s 618 shopping period, which allowed the iPhone 16 Pro with 128GB storage to qualify for domestic smartphone subsidies.
Foreign-branded phones increased their market share to 19% in May 2025, up from 14% in April 2025 and 17% in May 2024. On a month-over-month basis, foreign-branded shipments grew 29% in May, slightly below the seasonal average of 33% for the same period from 2021-2024.
Despite the relative outperformance of foreign brands, Goldman Sachs acknowledges market challenges as overall mobile phone trends worsened both annually and sequentially, with the total market declining 22% year-over-year and 5% sequentially in May.
In other recent news, Apple has filed a legal challenge against the European Union’s $587 million fine related to the Digital Markets Act. The company argues that the decision oversteps legal requirements and plans to present its case in court. Meanwhile, Apple is experiencing a decline in foreign-branded phone sales in China, with shipments dropping 9.7% year-on-year in May, according to data from the China Academy of Information and Communications Technology. On the analyst front, Jefferies has upgraded Apple’s stock from Underperform to Hold, citing a positive outlook on revenue and earnings growth driven by market share recovery in China. UBS, however, has maintained a Neutral rating on Apple, noting that while Vietnam is becoming more significant for tech supply chains, China remains Apple’s primary supply region. In a move to bolster its creative offerings, Apple Music has opened a new studio facility in Los Angeles. This new space is part of Apple Music’s 10th anniversary celebrations and aims to enhance artist-driven content and audio innovation. The Los Angeles studio will join Apple Music’s existing global network, with plans for additional studios in other locations.
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