apple (NASDAQ: AAPL) is heading for an unpleasant fall.
Goldman Sachs analyst Rod Hall said. On Monday, Hall reiterated his sell rating on Apple shares and reduced his price forecast from $ 80 to $ 75. His new estimates show a potential drop of more than 36 percent from Apple’s current price tag of nearly $ 118.
Hall increased its FY2021 earnings per share estimate for Apple by 4% after its fourth-quarter financial announcement. However, he reduced the price-to-earnings ratio at which he believes the tech giant’s stock will trade more than 8%, partly due to lower expected revenue growth.
After listening to Apple’s earnings call, Hall expects iPhone sales to grow only one digit in the first quarter. “Apple’s commentary towards the weaker 5G iPhone cycle we had forecast than the ‘Super Cycle’ expected by the consensus,” said Hall.
Should you sell Apple stock?
Hall is one of the biggest Apple bears on Wall Street. His $ 75 target price is 39% lower than analyst average forecast of $ 123. In other words, the consensus estimate shows that Apple shares will rise about 4%.
Furthermore, while disappointing iPhone sales will certainly put pressure on Apple’s stock price, Hall appears to be sharply devaluing Mac and iPad sales during the period of the coronavirus pandemic, as well as operations. Apple’s booming services business – all of which can help support profit growth.
Perhaps most importantly, Hall seemed to be placing a heavy burden on management comments in a conference call. Investors could be better served by focusing on the lucrative potential of the ultra-fast, fifth-generation network that promises to spur interest in new Apple iPhone models in the coming years. . So even if iPhone sales were below expectations in the first quarter, the long-term outlook is still much brighter.
Therefore, investors should not rush to sell their Apple shares anytime soon.