GF Securities Downgrades Apple to Hold Over Supply Constraints
Apple's stock fell significantly on July 31 after the company's disappointing future guidance led GF Securities to downgrade it from 'Buy' to 'Hold'. The multinational cited supply constraints, specifically a global memory crunch that could lead to higher iPhone prices and uncertainty over demand.
The analyst expects Apple's gross margin to slip below 47% in Q4, which is lower than expected. Additionally, the company's shares are trading at a forward price-to-earnings multiple of over 38x, which is considered stretched given the weaker-than-expected guidance.
Despite this, Barchart currently holds a '64% BUY' opinion on Apple, indicating that technical momentum remains in favor of the Nasdaq-listed firm. However, investors may be cautious due to artificial intelligence not proving a meaningful driver of growth for the iPhone maker yet.
The company's $100 billion buyback plan and small dividend yield keep it attractive as a long-term holding, but other analysts haven't thrown in the towel on Apple. The consensus rating remains at 'Moderate Buy' with a mean price target of $322, indicating potential upside of over 7% over the next 12 months.