The notion of an Apple (NASDAQ:AAPL) car—particularly an electric car—has long been talked about in the tech space. But that dream appears to be dead. Not only is the tech giant pulling out of the electric car concept, but it’s also shifting several of those employees who were working on the car to work on something else instead: generative artificial intelligence. That was good news for investors, who sent shares up fractionally in the final minutes of Tuesday’s trading session.
The news came as a surprise to those 2,000 or so employees working on what Apple called “Project Titan.” Reports note that most of the employees will simply be transferred, but some will be laid off outright. Perhaps the most interesting part is that Apple had a release date set for the Apple Car—2028—but the project is now in a “make-or-break” position, with the possibility of outright cancellation.
A Path to Catastrophic Failure for Apple
Why Apple suddenly bailed out of the electric car market isn’t clear. However, one point may have struck home just a little too hard. A UBS report noted that to justify Apple’s current share price, “everyone everywhere needs to spend $800 a year on Apple products.” That’s the word from UBS’ head of global equity strategy, Andrew Garthwaite, who suggests there is a path to catastrophic failure for Apple.
Here, “catastrophic” means a 30% drop in its share price, which would destroy $800 billion of shareholder value. Interestingly, the same report pointed out that “there appears to be no obvious AI strategy” at Apple. Well, here it is.
What Is the Price Target for Apple Stock?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on AAPL stock based on 16 Buys, eight Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After a 24.37% rally in its share price over the past year, the average AAPL price target of $206.15 per share implies 13% upside potential.
