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Apple Inc. (NASDAQ: AAPL) faced an 8% drop in share price during the first four months of 2024, even as the Nasdaq-100 Technology Sector index gained 6%. This decline was attributed to stagnant growth and a lawsuit from the U.S. Department of Justice. In May, however, Apple shares rebounded by over 12%, boosted by a strong second quarter fiscal report released on May 2, which showed revenue at $90.8 billion despite a 4% year-over-year decrease.
In the quarter ending March, iPhone sales dropped to $46 billion from $51.3 billion in the previous year, while service revenue grew to a record $23.9 billion, marking a 14% increase. Apple surpassed Wall Street expectations with earnings of $1.53 per share, beating the forecast of $1.50. Looking ahead, Apple forecasts low single-digit revenue growth and strong service segment growth in the current quarter, riding on anticipated gains from AI-enabled smartphones, with IDC estimating 170 million AI smartphones could be shipped in 2024.
Wedbush Securities revised its price target for Apple stock from $250 to $275, reflecting a potential 45% increase from current levels. Analysts have raised earnings expectations for Apple, with 28 increasing projections for the current fiscal year. Apple’s current trading multiples are at 29 times trailing earnings, below the Nasdaq-100’s multiples of 31, suggesting room for growth.
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