Fubotv earnings beat by $0.10, revenue topped estimates
On Tuesday, Raymond (NSE:RYMD) James updated its financial outlook for Apple (NASDAQ:AAPL), reducing the tech giant’s price target to $230 from the previous $250. Currently trading at $211.21 with a market capitalization of $3.18 trillion, Apple maintains a P/E ratio of 33.5. The firm maintained its Outperform rating on Apple shares. The adjustment reflects concerns over tariff-related headwinds that could impact the company’s earnings per share (EPS) in fiscal years 2025 and 2026. According to InvestingPro analysis, Apple appears to be trading above its Fair Value, with the stock currently showing elevated valuation multiples across several metrics.
The research firm’s analysts expect Apple to face challenges due to tariffs, which may lead to a negative 8-10% impact on EPS, assuming a 15% blended tariff rate on all imports. This rate is contrasted with higher reciprocal rates on imports from India and Vietnam. Despite these challenges, Raymond James believes Apple’s manufacturing capacity outside China could meet around half of the U.S. iPhone demand and anticipates the company will continue to increase procurement from non-China regions. InvestingPro data reveals Apple’s robust financial health with an overall score of "GOOD" and strong profitability metrics, including a healthy gross margin of 46.52% and impressive revenue of $395.76 billion in the last twelve months.
In light of these factors, the analysts foresee Apple potentially raising prices in the U.S. market, which could result in reduced demand. However, any potential decline in stock price is seen as an opportunity to invest, given Apple’s robust ecosystem, consistent growth in its Services sector, and the long-term potential of on-device AI technology.
The forecast also includes adjustments to revenue and EPS estimates for the March and June quarters of 2025. Revenue estimates for March 2025 have been increased from $94.5 billion to $96.3 billion, with a slight EPS bump from $1.62 to $1.65, attributed to strong iPhone demand. However, the June 2025 EPS estimate has been lowered from $1.50 to $1.44 to account for tariff costs. Gross margins are expected to decline by approximately 100 basis points as Apple absorbs these costs, with price increases anticipated to begin in the September quarter of 2025.
Finally, the analysts have revised their full-year EPS predictions, reducing the FY25 estimate from $7.31 to $7.15 and the FY26 forecast from $8.20 to $7.70. Despite the near-term impact of tariffs on consumer spending, iPhone demand remained healthy in the March quarter, driven by early purchases ahead of tariffs, the introduction of the iPhone 16e, and subsidies in China. This demand is expected to persist into the June quarter, although some moderation due to tariffs is anticipated. The Mac segment reported a 7% year-over-year growth in the first quarter of calendar year 2025, and Services are believed to have experienced double-digit growth, a trend that is likely to continue throughout the fiscal year. For deeper insights into Apple’s financial health, valuation metrics, and exclusive ProTips, including the company’s impressive dividend history and aggressive share buyback program, check out the comprehensive Pro Research Report available on InvestingPro.
In other recent news, Alphabet (NASDAQ:GOOGL) reported first-quarter results that exceeded expectations, driven by the success of its search advertising business. This positive performance also led to a rise in stocks for other tech giants like Meta (NASDAQ:META) and Amazon (NASDAQ:AMZN), while Microsoft (NASDAQ:MSFT) and Apple’s shares remained stable. Meanwhile, Apple has announced plans to shift the assembly of iPhones sold in the U.S. to India, a strategic move in response to ongoing trade tensions. Apple is also projected to equip its upcoming iPhone 17 models with 12GB of DRAM, potentially boosting suppliers Micron (NASDAQ:MU) and SK Hynix. In another development, Morgan Stanley (NYSE:MS) raised its price target for Apple to $235, maintaining an Overweight rating and highlighting Apple’s long-term value despite current challenges. Tesla (NASDAQ:TSLA) has raised its vehicle prices in Canada and is urging buyers to purchase before new tariffs take effect. Lastly, Nvidia (NASDAQ:NVDA) experienced a decline in shares following reports that Huawei is testing a new AI processor, which may compete with Nvidia’s products. These developments highlight the dynamic nature of the tech industry and its influence on market movements.
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