Apple Stock Drops Despite Beating Earnings Estimates on Valuation Worries

Apple reported better-than-expected earnings and revenue for its latest quarter, but its stock price still dropped 7% due to concerns over its high valuation.

The company's gross margin reached 50.1%, boosted by tariff refunds, but its Services revenue fell short of estimates.

This has led some analysts to reassess Apple's premium stock price, with the company now trading at 35 times forward earnings and boasting modest 8% EPS growth.

The PEG ratio is a key metric in this case, standing at 3.2, which many see as unsustainable without stronger growth.