Apple stock has wavered recently on mixed sales reports for the company's iPhone 16 smartphones. Still, investors might be wondering: Is AAPL stock a buy right now?
The consumer electronics giant unveiled its iPhone 16 smartphone lineup, as well as new models of the Apple Watch and AirPods, on Sept. 9. The launch event, titled "It's Glowtime," was a largely surprise-free affair because most of the hardware news had leaked out weeks earlier. Apple stock rose a fraction for the day.
The star of the event was the iPhone 16 lineup, which comes with Apple's take on artificial intelligence, branded Apple Intelligence. Apple AI will use both on-device and data-center processing with a focus on privacy and security.
The centerpiece of Apple's AI strategy is a revamped Siri digital assistant, which responds to voice and text prompts. With AI smarts, Siri will be able to work across apps and retrieve information from messages, emails, calendar, photos and other apps. It also can summarize emails and webpages and transcribe calls. Plus, it can generate custom emoji and other images.
The iPhone 16 also has an AI application called Visual Intelligence. The tool lets you use your camera to instantly learn about anything you see, be it a plant, animal, business or other object.
Slow Rollout For Apple Intelligence
Apple stock analysts said iPhone 16 sales could be muted by the staggered rollout of Apple Intelligence features.
Apple's iPhone 16 smartphones officially went on sale Sept. 20 but the first batch of Apple Intelligence features didn't become available until Oct. 28. The next batch is scheduled to come out in December.
Wall Street analysts have described Apple Intelligence as "not quite ready for prime time" and "not a fully baked offering."
On Sept. 13, Apple began taking preorders for the new smartphones. Several analysts reported that first-weekend sales were lower than expected, especially for Pro models.
After the handsets hit stores, some analysts said sales were softer than for last year's iPhone 15 series, but still healthy. Other reports showed strong sales for the Pro models but lackluster sales for the regular models.
Apple Stock Headwinds
Apple shares have been battered recently by several other news stories.
On Sept. 10, the European Court of Justice, the European Union's highest court, upheld an order for Ireland to recoup up to 13 billion euros, equivalent to $14.35 billion, plus interest, in taxes from Apple. The European Commission, the EU's executive arm, argued that Ireland had granted Apple benefits in contravention of EU state-aid rules, allowing the tech giant to pay substantially less tax than it owed.
On Aug. 5, a federal judge ruled that Alphabet unit Google violated antitrust laws by engaging in unfair business tactics to dominate the internet search advertising market. A central part of the Justice Department's case against Google was the company's $20 billion in annual payments to Apple to make Google the default search engine on iPhones.
Those payments to Apple are now threatened as the case moves to a remedy phase.
On Aug. 3, Warren Buffett's Berkshire Hathaway disclosed a massive sale of its Apple stake. Berkshire Hathaway cut its stake in Apple by 49% in the second quarter.
On Nov. 2, Berkshire Hathaway revealed another cut to its Apple stake. The conglomerate sold 25% of its Apple holdings, leaving it with 300 million shares. Buffett's stake is down from 905 million Apple shares at the start of 2024.
Apple Fundamentals
Late on Oct. 31, Apple beat Wall Street's estimates for its fiscal fourth quarter. However, it provided a weaker-than-expected sales growth target for the current quarter. Apple stock fell after the report.
Apple earned an adjusted $1.64 a share on sales of $94.93 billion in the quarter ended Sept. 28. Analysts polled by FactSet had expected earnings of $1.60 a share on sales of $94.5 billion. On a year-over-year basis, Apple earnings rose 12% while sales increased 6%.
In the September quarter, Apple's hardware sales rose 4% year over year to $69.96 billion while services revenue increased 12% to $24.97 billion.
Apple's iPhone revenue climbed 6% to $46.22 billion and accounted for 49% of the company's total sales in fiscal Q4.
For the December quarter, Apple expects its total revenue to grow in the "low to mid-single digits" on a percentage basis year over year, Chief Financial Officer Luca Maestri said on a conference call with analysts. Wall Street was modeling 6.8% sales growth in the period.
AAPL Stock Technical Analysis
Apple stock has an IBD Composite Rating of 83 out of 99, according to IBD Stock Checkup. IBD's Composite Rating combines five separate proprietary ratings of fundamental and technical performance into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better.
AAPL stock has an IBD Relative Strength Rating of 60 out of 99. The Relative Strength Rating shows how a stock's price performance stacks up against all other stocks over the last 52 weeks.
Is Apple Stock A Buy Right Now?
No, Apple stock is not a buy right now. After its September-quarter earnings report, Apple fell below its 50-day moving average line, a key support level.
Apple shares had been flirting with a buy point of 237.23 out of a 13-week consolidation pattern, according to IBD MarketSurge charts. On Oct. 15, Apple stock climbed to a record high of 237.49 but ended the day below the potential buy point.
For investors unfortunate enough to have purchased Apple stock during that fake-out breakout, shares eventually dived into a stop-loss sell zone.
Apple stock ended regular-session trading on Nov. 11 at 224.23.
Keep an eye on the overall stock market. If the market turns south, don't try to fight the general stock market direction.
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