Apple (NASDAQ:AAPL) recently unveiled four new models of the iPhone 15. Soon after the launch, AAPL stock closed lower as the company did not increase the prices of the iPhone 15 Pro and Pro Max (its pricier versions) as many expected. Further, overheating issues in the new models spell unfavorable news for the company. Despite these issues, analysts see strong demand for the iPhone 15 as driving its financials and share price.
For example, on September 19, Goldman Sachs analyst Mike Ng wrote to investors that the new iPhone 15 models are witnessing a notable increase in lead times. The analyst is encouraged by the increased lead times and sees this as an indicator of strong demand for all iPhone 15 models, particularly in China. Mike is bullish about AAPL stock and recommends a price target of $216.
Echoing similar sentiments, Morgan Stanley analyst Erik Woodring reiterated a Buy on Apple stock on September 25. Woodring is encouraged by early demand trends for the iPhone 15.
While analysts are bullish about the iPhone 15’s prospects, the company plans to release an iOS 17 software update to tackle the overheating issues related to the iPhone 15. Apple informed several media companies that the overheating problems can be attributed to various factors, including a software bug within iOS 17. Further, it clarified that the heat-related issues are not caused by the new titanium design.
With this backdrop, let’s look at what the Street recommends for Apple stock.
Is Apple a Buy, Sell, or Hold?
Analysts are encouraged by early demand trends for the iPhone 15. Meanwhile, its large installed base of devices and strength in its service revenue are positives. However, increased competition, macro uncertainty, and Apple’s premium valuation keep analysts cautiously optimistic in the near term.
Apple stock carries a Moderate Buy consensus rating on TipRanks based on 21 Buy and eight Hold recommendations. Analysts’ average price target of $207.69 implies 21.31% upside potential from current levels.
Bottom Line
Apple is a solid long-term stock. Given its large installed base, growing services business, and substantial cash flows, Apple is poised to enhance its shareholders’ returns. However, near-term headwinds and recent appreciation in its share price could limit the upside in Apple stock, as reflected by analysts’ Moderate Buy consensus rating.
