Apple (NASDAQ: $AAPL) is set to unveil the iPhone 16 at an event on Monday, September 9, dubbed “Glowtime.” The company is expected to unveil numerous upgrades, including an OLED display and AI integration. Let us examine how the launch could impact Apple’s stock going forward.
Apple’s Glowtime Event
The Apple “It’s Glowtime” event is its biggest event of 2024 and will begin at 17:00 GMT on Monday, September 9. Tech enthusiasts and market analysts will be closely following the event.
The giant tech company will launch its iPhone 16 series, which includes iPhone 16, Plus, Pro, and Pro Max models. Some of the design changes will include technical upgrades, placing Apple at the top of headlines for the rest of the week.
The company is expected to launch a new OLED display and the latest A18 processor, which will feature “Apple Intelligence,” a suite of AI capabilities.
Why The Event Matters
The top-end smartphone market has come under increasing competition, with Huawei unveiling a series of devices that could eat into Apple’s share worldwide, especially in China. Apple, which has been a leader in new technologies and electronics, including launching the first true smartphone, faces a new frontier in technological innovation in AI.
As more businesses integrate AI into their daily life, it has led to an increase in AI investments at Apple. The company recently partnered with OpenAI to integrate AI across its devices. One of the improvements will include an upgrade to Siri with AI capabilities.
It is also expected to introduce AI editing capabilities for photos and video. Another expected feature is the integration of AI into Apple’s health applications, which will include data analysis and AI-powered recommendations.
Analysts Opinion On Apple Event
Jim Crame, a prominent CNBC stock analyst, shared his opinions of Apple’s upcoming event. According to Cramer, Apple and the other top seven tech firms remain overvalued despite a recent spate of selloffs.
The analysts pointed out that investors no longer factor in the fundamentals when investing in the big seven tech companies. This has resulted in massive overvaluation for these stocks. However, other analysts believe the event could increase Apple’s stock price.
Morgan Stanley analysts are cautious about the upcoming launch. They note that the Apple event has historically seen AAPL stock underperform the S&P 500 and modestly outperform the market in the upcoming three months.
However, Bank of America analysts say this year’s event could be different due to a slew of AI capabilities that Apple plans to unveil. If Apple makes a compelling case for its Apple Intelligence capabilities, the stock could perform better than past launches.
Highlights From Q3 Results
In its Q3 results, Apple reported revenue of $85.8 billion, a 5% increase from 2023 and above estimates of $84.4 billion. Meanwhile, EPS rose 11% year over year to $1.40, beating estimates of $1.34. iPhone sales declined 1% to $39.3 billion, accounting for 46% of total revenue.
Apple’s Stock Performance
AAPL stock has had a solid showing in 2024, rising 18.95% this year to $220.82. Over the past 12 months, the stock has gained 23.12%, outperforming the S&P 500, up 20.52% in the same period.
On Friday, the stock finished 0.7% lower at $220.82. Based on The Monday Effect theory, AAPL could continue its downward trend on Monday. The stock’s last closing price is below its 50 200 DMA of $222.57 and above its 200 DMA of $194.77.
Analysts remain optimistic about the stock’s future, giving it a moderate buy rating. They forecast a wide range for the stock in the next 12 months, with a high of $300 and a low of $186. Their average forecast of $250.74 is a 13.55% upside from the last closing price.
Should You Add Apple (AAPL) to Your Portfolio Ahead Of The iPhone Launch?
Apple (AAPL) has experienced a stall in revenue growth in recent years. One reason for this is that people upgrade their phones once every three years compared to once a year in the past. The reason is that phones have become exceedingly expensive. Additionally, phone technology has matured, and you can still enjoy convenience without the latest features.
However, if Apple can demo a giant leap in capabilities, it could send the stock to new heights. Despite this, the company is expensive, with a 29.07 forward P/E ratio. Based on the risk-to-reward dynamic of the stock right now, adding AAPL to your portfolio might not pay off in a meaningful way.
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