From Financial Modeling Prep: 2025-01-07 12:23:00

MoffettNathanson analysts downgraded Apple (NASDAQ:AAPL) to Sell from Neutral, with a price target of $188, down from $202. Concerns over valuation and lackluster consumer response to AI features drove the decision.

The downgrade was based on a discounted cash flow analysis with an 8.0% cost of capital and 4.0% growth rate, resulting in a 19.5x EV/EBITDA terminal multiple. Apple’s valuation is seen as high relative to growth prospects.

Apple’s AI features have not sparked the expected upgrade cycle, reflecting broader consumer disinterest in AI. Progress in fully agentic AI, crucial for Apple’s long-term prospects, seems further off than previously thought.

Despite Apple’s product innovation and strong management, its stock price reflects overly optimistic assumptions. With the highest valuation among tech elite “Mag Seven,” Apple’s growth outlook is less attractive in the current market.



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