Apple Faces Most Sell Ratings Since Steve Jobs' Death

Apple is currently experiencing a wave of negative sentiment from financial institutions, with investment firm Jefferies downgrading the company's stock from "hold" to "underperform" on Monday. This downgrade, equivalent to a "sell" rating, also saw Jefferies slash its price target for Apple shares from $285.56 to $263.66. The analysts cited several key concerns, including the cancellation of a rumored all-glass iPhone intended for the iPhone's 20th anniversary next year, persistent challenges in managing surging memory prices, and a perceived lack of significant progress in Apple's artificial intelligence initiatives. Jefferies analysts noted in their report that "introducing new form factors in the iPhone to drive higher [average selling price] is more difficult than expected," referring to the anticipated premium price of the all-glass iPhone. Looking ahead, Apple's anticipated foldable phone, potentially to be revealed next month, is seen as the company's sole potential driver for improved margins. However, even this product faces headwinds, with memory cost increases expected to elevate the selling price to an estimated $2,199 for the 256 gigabyte version and $3,099 for the 2-terabyte model, according to the analysts' projections. This influx of negative ratings has brought Apple to a critical juncture; Bloomberg estimates that at least six Wall Street firms have now issued "sell" equivalent ratings for Apple stock. This level of bearish sentiment matches a high observed in 2012, a period shortly after the death of Apple's co-founder, Steve Jobs. Earlier in July, KeyBanc Capital Markets had already lowered its valuation to "underweight," citing concerns over weakening iPhone demand. Apple's stock performance has been notably sluggish since the company announced in late July that it anticipates iPhone sales, which constitute approximately half of its overall business, to grow at a "mid-teens" percentage rate in the current quarter. This projected growth rate represents a significant deceleration from the 22% growth the iPhone segment achieved in the preceding quarter. Furthermore, Apple also indicated that its gross profit margins are expected to face pressure during the current fiscal quarter, compounding the challenges faced by the technology giant.