Pros and Cons of Apple Stock: Should You Invest? 2025 Update

This suggests Apple’s stock might be overvalued, limiting growth. Amit Daryanani, Evercore ISI, joins ‘The Exchange’ to discuss Apple’s quarterly earnings results, if Apple saw trepidation from budget-friendly customers and much more. Apple reported a bump in quarterly sales and predicted the holiday season would be its “best iPhone quarter ever.” But concerns around China and AI persist. Apple delivered mixed Q4 results, with iPhone revenues should i buy apple stock missing estimates but strong Services and Mac performance supporting growth.

Our PAST TOP PICK with AAPL has achieved its target at $236. To remain disciplined, we recommend covering half the position at this time and trailing up the stop (from $175) to $195. On Tuesday, they roll out the iPhone 17 and he likes what he’s hearing about them. Is up only 7.78% the past year, trailing the S&P, but doesn’t bother him. Is up 41% since the April low, back in the good graces of Trump.

Risks: Regulation, Tariffs, and Competition

That means the boost from AI and new iPhone sales may already be priced into the valuation. This is mainly due to its hardware sales, services, and recurring revenue. In 2023, Apple made $394.3 billion in total revenue, a 4.5% increase from the previous year. This shows the company’s financial health and resilience.

• The company sells the iconic iPhone, Mac, and other products that consumers flock to — even if their prices are higher than those of rivals.
• Investors that want to beat the S&P 500 likely have to stay invested in big tech while looking to make outsize bets elsewhere.
• Sales of wearables and iPads, meanwhile, were both flattish for the quarter.
• In the first quarter of 2025, iPhone models took the top four spots in Counterpoint Research’s list of the best-selling smartphones globally.

iPhone momentum

Growth was broad based, although the company called out strong App Pay revenue growth. The gross margin for the services segment came in at 75.3%, much higher (as usual) than its product segment margin. Apple Inc. (AAPL) has been a top success in the 21st century. It has a strong brand, loyal customers, and steady revenue growth. But, like any stock, investing in Apple comes with both benefits and risks.

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Now, it’s worth noting Stock Advisor’s total average return is 1,072% — a market-crushing outperformance compared to 194% for the S&P 500. Don’t miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. However, for its fiscal 2026 Q1, Apple projected that iPhone sales would grow by a double-digit percentage. While last quarter’s revenue was powered by the iPhone 16, next quarter’s forecast is based on strong initial uptake for the iPhone 17. Some AI features may also require a subscription, which could lead to yet another new element in Apple’s growing ecosystem and bolster its service revenue.

Always conduct your own research or check with certified experts before investing, and be prepared for potential losses. Opinions expressed herein are those of the authors and not necessarily those of Analytics Insight, or any of its affiliates, officers or directors. J.P. Morgan analyst Samik Chatterjee increased his price target to $290 from $280. He maintains a buy rating citing high-single-digit revenue growth expectations for Q4 and Q1. Earnings reports or recent company news can cause the stock price to drop. Read stock experts’ recommendations for help on deciding if you should buy, sell or hold the stock.

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They have an installed user base of over 2.35 billion active devices, so any hyperscaler would pay up to access that user base. Also, they delivered a strong quarter (shares ran up before, not after the report). In its fiscal Q3, revenues jumped 13% as people rushed to upgrade their phones before tariffs made them more expensive. In the most recently completed quarter, which ended Sept. 27, Apple followed that up with 6% top-line growth to $49 billion. However, that did fall just short of analysts’ consensus estimate of $50.2 billion, as the company ran into some supply constraints. In fact, services revenue has soared to records quarter after quarter, showing that services could be the next big revenue driver for this market giant.

• Wearables sales were $9 billion, topping the $8.5 billion analyst consensus, while iPad sales came in at $6.95 billion, in line with expectations.
• In China, which has been a weak spot for the company, revenue fell by 4%.
• The average analyst price target of $260.74 sits 3% below current trading levels.
• Apple is a great stock to own but I wouldn’t buy it today.
• Product gross margin rose by 170 basis points, helped by mix, although the company got hit with $1.1 billion of tariff-related costs.
• The risk for investors is that while the early sales numbers and preorders for iPhone 16 may be strong, these are still fairly primitive estimates.

AMZN, AAPL and GOOG Forecast – Major Stocks in America Look to Go Higher

Wall Street forecasts earnings will climb 8.5% year-over-year to $1.78 per share. Revenue is expected to jump 7.6% to $102.17 billion compared to $94.93 billion in the prior year period. Stockchase rating for Apple Inc is calculated according to the stock experts’ signals. A high score means experts mostly recommend to buy the stock while a low score means experts mostly recommend to sell the stock. Historically, though, shares rise 13% on aaverage immediately after the previous 5 iPhone roll-outs. Sales of wearables and iPads, meanwhile, were both flattish for the quarter.

Investors are now asking whether this dip presents a buying opportunity or signals more trouble ahead. Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. This isn’t an Apple-only headwind, but one that may impact much of the tech industry — and this point is what could prove to be positive for Apple. It’s unlikely the U.S. would apply tariff levels that would be destructive for an entire industry, especially since this industry has played a strong role in powering economic growth. To make matters worse, the president has targeted Apple specifically, saying if the company doesn’t bring iPhone production to the U.S., it may face a 25% tariff on all iPhone imports. Meanwhile, Apple announced plans to move production of U.S.-destined iPhones to India from China, but the problem with this is goods from India also will face import tariffs.

Apple (AAPL +0.56%) has been a winning investment over time as it’s become a consumer goods giant, with more than 2.2 billion active devices installed worldwide. The company sells the iconic iPhone, Mac, and other products that consumers flock to — even if their prices are higher than those of rivals. That’s because Apple has built a strong brand, which has become part of its moat or competitive advantage.

Its flagship iPhone can be seen in the hands of many around the world. Lee warns investors hold excessive expectations for unconfirmed products like iPhone 18 and a potential foldable model. Jefferies analyst Edison Lee maintains a sell rating with a $203.07 price target. Lee argues the stock price already reflects iPhone 17 optimism.

Dan Ives on AAPL & GOOGL “One-Two Punch,” PLTR Potential, A.I. “Goldilocks Scenario”

Wearables sales were $9 billion, topping the $8.5 billion analyst consensus, while iPad sales came in at $6.95 billion, in line with expectations. Copyright © 2025 FactSet Research Systems Inc.Copyright © 2025, American Bankers Association. CUSIP Database provided by FactSet Research Systems Inc. SEC fillings and other documents provided by Quartr.© 2025 TradingView, Inc.

For the current quarter, which ends in December, Apple expects its revenue to grow by 10% to 12% year over year, with services revenue increasing at a similar rate to fiscal 2025. Mac sales, meanwhile, were strong during the quarter, jumping 13% year over year to $8.7 billion, driven by the MacBook Air and strong growth in emerging markets. That was just ahead of the $8.6 billion in sales that analysts had expected.

An estimated 300 million iPhones around the world are over four years old, which could lead to higher sales as users replace older models. Investors are watching closely to see if the company can build meaningful revenue streams from its AI efforts. Apple entered the AI race late with the introduction of “Apple Intelligence,” a suite of AI features designed for iPhones, iPads, and Macs. These features include improvements to Siri and integration with services like ChatGPT. However, critics have pointed out that Apple’s AI launch has been slow and lacks commercial potential.