Apple Defies Gravity As New Threats Are Not Priced In

Summary:

• Apple stock has shown total returns close to S&P500 in YTD and over the last 3 years with very small outperformance.
• The company is facing challenges in China, where it receives over 17% of the total revenue.
• Apple’s Wearables segment is also showing a decline, and the poor reception of Vision Pro will not help in improving the results in this segment.
• The iPhone and Services segment has performed well in the recent quarter, but longer iPhone upgrade cycle and regulatory pushbacks in Services can hurt the growth momentum.
• Apple is trading at close to 30 times the forward EPS estimates for fiscal year ending Sep 2026 which reduces the margin of safety and returns potential in the near term.

Apple (NASDAQ:AAPL) stock has shown close to 30% YTD total returns, which is only slightly above the broader S&P 500 total returns of 25% in 2024. Even the recent Apple Intelligence iPhone upgrade has not given a

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