From Nasdaq: 2025-05-18 06:30:00

The announcement of a 90-day tariff pause with China led to a spike in tech stocks, with Apple being called a “dream scenario” by Wedbush Securities analyst Dan Ives. However, Apple recently lost its market cap lead to Nvidia, raising questions about its value proposition and innovation. While Apple has liquidity of $157 billion and a strong position to weather a U.S.-China trade war, its growth has slowed, and its high P/E ratio may not justify its premium. Investors should consider Apple a hold for now, despite optimism from analysts.

The iPhone still dominates Apple’s revenue, making up 53% of sales in the first six months of fiscal 2025. While the company has begun to diversify its manufacturing, a trade war with China could pose challenges. Apple’s strong liquidity position and ongoing innovations in AI and technology keep it competitive in the market. However, concerns about lack of innovation, single-digit earnings growth, and a high P/E ratio suggest caution for investors. The tariff pause brings relief, but without a permanent agreement in place, the issue may resurface, making Apple a hold for now.

Before investing in Apple, consider that the Motley Fool Stock Advisor team did not include Apple in their list of 10 best stocks to buy now. Past recommendations from the team have led to significant returns, and investors may want to explore other opportunities. With Apple’s growth slowing and competition increasing, the stock may not offer the same potential for returns as other top stocks. Investors should weigh the risks and rewards before adding Apple shares to their portfolio.



Read more at Nasdaq: Dan Ives Says U.S.-China Tariff Pause Is a “Dream Scenario” for Apple. Is This the Buy Signal Investors Were Waiting For?