One analyst thinks Apple stock won’t be climbing much more for now

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iphone x
Nomura Instinet analyst thinks iPhone X growth is fairly reflected in current share price.
Photo: Ste Smith/Cult of Mac

With the exception of a few software-related blips, Apple has had an incredible 2017 — but its phenomenal run of success could be coming to an end, claims one analyst.

Nomura Instinet analyst Jeffrey Kvaal has lowered his recommendations concerning AAPL from “buy” to “neutral,” suggesting that the current share price adequately reflects iPhone X sales.

“We argue that the stock’s gains for the iPhone X supercycle are in the late innings,” Kvaal wrote in a note to clients. “We believe unit growth, if not quite Average Selling Price growth, is well anticipated by consensus and a historically full multiple.”

Although Apple has made big strides with its Services industry, which Apple now considers a core part of its business, Kvaal writes that this isn’t enough to lift AAPL stock any further, either.

While this is just one analyst speaking, it’s notable if only because Apple downgrades are rarer than AirPod availability around the holidays. The last time AAPL was downgraded to neutral or equivalent rankings was back in June.

Overall, analysts remain incredibly positive about AAPL. Even with the downgrade, no-one seems to be advocating selling AAPL stock, just potentially holding off on buying any at its current price.

A great year… so far

2017 has generally been an enormous year for Apple. In early November, Apple became the first company in history to pass the $900 billion valuation mark (just as previously as it broken records as the world’s first $700 billion company and first $800 billion company before that).

However, there have been a few dark clouds looming. While Apple has done a tremendous job of ensuring that iPhone X supply meets demand, some analysts have speculated that this reflects a lower level of interest in Apple’s next-gen iPhone handset.

Ultimately, we won’t know until Apple announces its next quarterly report. At that point we’ll have a better idea of whether Jeffrey Kvaal’s observation is shrewd or unnecessarily panicky.

Heck, given the speculation that the iPhone super cycle will eventually push Apple over the $1 trillion valuation mark, this could wind up being a terrible time to be shy about investing in AAPL.

Source: Bloomberg