HSBC Keeps Buy Rating, $366 Price Target on Apple Amid Supply Chain Concerns

HSBC has maintained its 'Buy' rating on Apple Inc.'s stock and kept its price target at $366.00. The bank uses a target non-GAAP price-to-earnings ratio of 33.5x, based on the 10-year average plus two standard deviations. HSBC applies this multiple to its fiscal year 2027 non-GAAP earnings per share estimate of $11.22, with a 2.5% regulatory risk discount.

Apple currently trades at a P/E of 36.92 with a market cap of $4.67 trillion. According to InvestingPro analysis, the stock appears overvalued relative to its Fair Value, placing it among stocks on the Most Overvalued list. HSBC believes Apple can mitigate supply chain bottlenecks and cost pressure by applying more pricing power.

The firm also noted that Apple may face low take-up of new AI services and competition from AI labs with new form factors that could challenge smartphones, citing these as downside risks. Despite this, the $366 price target implies an upside of 14.4% from current levels.