Apple Stock: The Market Is Getting Irrational


  • Despite the strong upward reaction of the stock on WWDC event, I still conclude that the current stock price is unreasonably high.
  • The recent AI features and updates may indeed trigger a significant upgrade cycle. New partnerships and product updates in AI and machine learning offer growth potential.
  • Even assuming robust EBIT margin growth and premiums for revenue growth rates, Apple stock is overvalued by 12.5%, based on my DCF. The market may be irrational.
  • I maintain a medium-term “Sell” rating for Apple stock.

Single Red Apple

Jonathan Knowles/DigitalVision via Getty Images


I initiated coverage of Apple Inc. (NASDAQ:AAPL) stock in December 2021 and gave the stock a ‘Hold’ rating, pointing to the strength of the brand but also a fairly generous valuation at the time. A

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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