Jefferies Downgrades Apple to Underperform Amid iPhone 20 Design Concerns
Analyst firm Jefferies has downgraded Apple stock to Underperform and cut its target price to $263.66, citing concerns over the cancellation of the all-glass design for the iPhone 20.
According to Jefferies analyst Edison Lee, the all-glass design was scrapped due to low yield rates, which would have made higher-priced iPhones amid soaring memory costs more difficult.
The move is a setback for Apple's efforts to increase prices and margins on its flagship devices, particularly the iPhone Pro and iPhone Pro Max models, which were expected to feature the all-glass design. Lee believes that the folding iPhone will be niche at over $2000 and is the 'only key driver of higher ASP and margin.'
Jefferies' downgrade comes as Wall Street largely disagrees with the bearish forecast, with 47 firms covering Apple having an Underperform rating only from Jefferies. The current price of Apple's stock is $310.00 before trading opens on August 10.