Morgan Stanley Downgrades Apple Price Target Amid Supply Chain Pressures
Morgan Stanley has downgraded its price target for Apple (NASDAQ: AAPL) to $360 from $364 despite the tech giant beating Wall Street expectations in its latest earnings report.
The company posted adjusted earnings of $1.91 per share, topping consensus estimates of $1.89 per share, and revenue came in at $109.42 billion for the fiscal third quarter, ahead of the $108.65 billion Wall Street had expected heading into the print.
iPhone revenue reached $54.25 billion, also beating analyst expectations of $53.86 billion for the period, but Apple issued weak guidance citing supply chain difficulties that CEO Tim Cook described as a 'hundred-year flood' in memory supply.
The bank maintained its Overweight rating on the stock but warned that Apple's Services business is slowing down, with revenue growing 12% year over year and missing Wall Street estimates. Morgan Stanley noted that rising memory costs are putting greater pressure on margins ahead of expected iPhone price increases later this year.