Gold prices buoyed by tariff fears; US duties on 1-kilo bars spur supply concerns
On Tuesday, KeyBanc Capital Markets adjusted its outlook on Apple Inc. (NASDAQ:AAPL), reducing the stock's price target to $170 from the previous $200 while keeping an Underweight rating. The adjustment comes after an analysis of recent financial data and market trends. According to InvestingPro data, Apple's stock has declined significantly, with a YTD return of -27.46%, despite maintaining its position as a $2.73 trillion market cap giant with robust annual revenue of $395.76 billion.
Brandon Nispel of KeyBanc cited the Key First Look Data (KFLD), which indicated a 29% month-over-month increase in indexed spending for March, surpassing the three-year average of 6%. This uptick was attributed to new product launches, including the iPhone 16e, MacBook Air, and iPad Air, which occurred in late February and March. Despite the positive spending data, the analyst expressed concerns about potential shortfalls in iPhone and iPad sales, although they anticipate stronger performance for Mac. The company maintains a strong financial health score of GOOD according to InvestingPro analysis, with a gross profit margin of 46.52%.
Nispel's commentary pointed to mixed signals in the market, noting that while the new products contributed to a year-over-year increase in spending, there was weaker commentary on upgrades from mobile carriers. This combination of factors leads KeyBanc to predict a miss on iPhone and iPad sales targets, contrasting with an expected outperformance in Mac sales.
Looking ahead, KeyBanc acknowledges the uncertainty surrounding tariffs and their potential impact on Apple's pricing and consumer demand. There are additional concerns about the broader implications on global consumer spending and regional 'nationalism' movements, which could affect Apple's performance. Despite the lack of a quantified tariff impact, the firm's stance remains cautious, with expectations set below the consensus.
KeyBanc's report underscores the challenges and uncertainties facing Apple as it navigates a complex global market environment. The revised price target reflects the firm's conservative outlook on the tech giant's financial prospects in the near term. Trading at an EV/EBITDA multiple of 20.28x, Apple's valuation metrics suggest premium pricing. Investors seeking deeper insights into Apple's valuation and growth prospects can access comprehensive analysis through InvestingPro's detailed research reports, which cover over 1,400 top US stocks.
In other recent news, Apple has redirected a portion of its iPhone production to India in response to increased tariffs on Chinese goods. This move aims to mitigate the impact of the tariffs, which have raised concerns about Apple's revenue, as the iPhone constitutes about 50% of the company's earnings. Bank of America analyst Wamsi Mohan noted that Apple plans to produce approximately 25 million iPhones in India this year, potentially supplying about 50% of U.S. demand if redirected from India. Meanwhile, UBS has maintained a Neutral rating on Apple stock with a price target of $236, citing a slowdown in App Store growth during March 2025, particularly in the U.S. market. In contrast, JPMorgan has reiterated an Overweight rating with a $270 price target, highlighting a steady growth in Apple's Services sector despite mixed App Store performance. Additionally, Apple is challenging a UK government order to create a "back door" to its encrypted cloud storage, a move that underscores the company's stance on data privacy. These developments are part of the broader context of Apple's strategic adjustments and market performance amid regulatory and economic pressures.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.