Apple’s highly anticipated iPhone 15 launch has failed to meet expectations, disappointing both investors and Wall Street.
Mixed Reactions to New iPhone Models
On Tuesday, the world’s most valuable company revealed its new iPhone models, with few surprises. Analysts had anticipated a price increase for the iPhone Pro, but Apple chose not to make any changes, except for raising the starting price for the Pro Max by $100.
Market Response
Following the announcement, Apple stock (ticker: AAPL) which closed at $176.30 on Tuesday, experienced a 1.7% decline. According to Dow Jones Market Data, historical trends show that Apple stock typically rises 5% on average in the three months following an iPhone release. However, in premarket trading on Wednesday, Apple stock fell by another 0.5% to $175.47.
Experts Share Insight
Tom Forte, an analyst at D.A. Davidson, believes that the latest iPhone launch will not boost Apple stock as it has in previous years. In a note on Wednesday, he stated, “Unlike years past, we believe the company may not be able to rely on strong iPhone sales to drive its share price higher.” Forte pointed out that despite the release of the iPhone 15 on September 22, management is actually predicting a decline in revenue for the September quarter. He also expressed concerns about potential lackluster sales in China. Forte maintained a Neutral rating on Apple stock with a price target of $180.
Meanwhile, analysts at KeyBanc, led by John Vinh, considered the product launch to be “slightly negative” for Apple’s stock. Nevertheless, they upheld an Overweight rating and a $200 price target. They explained their stance, stating, “We see the September event as a modest negative for Apple given a lack of expected price increase for the Pro model, features that lack a compelling motivation for consumers to upgrade, and modestly less aggressive promotions from carriers.”
Evercore ISI analysts shared a similar sentiment, describing the event as “mildly disappointing.” They believed that an increase in price for the Pro model would have helped offset the impact of Huawei’s recently launched new smartphone.
In conclusion, Apple’s iPhone 15 launch has not generated the excitement that many had hoped for. Analysts and investors are expressing doubts about whether strong iPhone sales alone can continue to drive growth in Apple’s stock price. Only time will tell how the market responds in the coming months.
Apple’s iPhone 15 Launch Generates Mixed Reactions from Analysts
Investors had tempered expectations for Apple’s recent iPhone 15 launch, given the long period since the last major design or functional upgrade. However, many were hoping for a $100 price increase for the Pro model to counter any potential impact from Huawei’s Mate 60 Pro launch. While this did not materialize, some analysts remain positive about the company’s prospects moving forward.
Wedbush analyst Dan Ives increased his price target for Apple stock to $240, up from $230, and maintained an Outperform rating. He believes that the upgrade cycle over the next year will surpass expectations. While the lack of a price increase for the iPhone 15 Pro was surprising, Ives considers the move to raise the price of the Pro Max as a “smart strategic move.”
Ives also predicts that more consumers will choose the Pro models over the basic model, expecting a split of 75% to 25%, compared to the 60% to 40% split seen in recent years. This shift towards Pro models would be a significant boost to Apple’s average selling price and provide continued momentum heading into the holiday season.
Citi analysts also found positives in Apple’s launch, noting that maintaining flat pricing on all three models could help boost unit sales in a challenging macroeconomic environment. They emphasized that Apple’s focus is on maximizing gross profit per unit from consumers upgrading to premium phones. Additionally, they anticipate that the iPhone 15 will drive higher levels of premiumization compared to the iPhone 14 range. As a result, Citi analysts maintained a Buy rating on Apple stock with a price target of $240.
In conclusion, while opinions on Apple’s iPhone 15 launch varied among analysts, there is a consensus that the company’s product cycle remains robust globally. With the introduction of the iPhone 15, Apple is expected to gain further momentum heading into the crucial holiday season.
