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Apple Stock Price Could Crumble on Lower iPhone sales and Apple TV + Concerns

Apple (NASDAQ: AAPL) stock price bounced 40% since the start of this year. The stock is currently hovering close to the highest level of this year. Bears, however, expect limited upside potential for Apple stock price. They believe lower iPhone 11 sales and Apple TV+ could negatively impact its financial numbers.

AAPL Apple Inc. daily Stock Chart

Market reports are indicating “weak” pre-orders for the iPhone 11 family.

Analyst Jun Zhang says “there is no wait time today for the iPhone 11 Pro and Max” in the United States.” The analyst claims that initial sales expectations could drop 20-30% from last year’s iPhone XS and Max sales.

JD.com data also shows lower demand for iPhone 11. This is evident from pre-orders of about 500K compared to 900K for the iPhone XR last year.

On the back of lower iPhone11 sales, Rosenblatt has set a price target of $150 for Apple stock price with a sell rating.

iPhone sales are also seeing a low response from customers in Asia. This is due to its strategy of skipping 5G support on its new iPhones.

In addition, Goldman Sachs claims regarding Apple TV + are adding to investors concerns. Goldman Sachs analyst Rod Hall believes Apple’s strategy of offering a one year trial period for Apple TV+ could create a huge negative impact on earnings per share. The firm has reduced its price target to $165 from $185.

Apple, one the other hand, has refuted the Goldman Sachs claim. Apple’s statement to CNBC: “We do not expect the introduction of Apple TV+, including the accounting treatment for the service, to have a material impact on our financial results.”

Despite bearish sentiments and lower price targets, Bank of America sees substantial growth in subscriber base due to attractive Apple pricing. Apple has set monthly price for Apple TV+ service at $4.99/month, down significantly from analyst’s expectations. Bank of America has set a price target of $250 for Apple shares.

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Based in Saudi Arabia, Siraj has a strong understanding of and passion for accounting and finance. He has worked for international clients for many years on several projects related to the stock market, equity research and other business, accounting and finance related projects. Siraj is a published financial analyst on the world's leading websites including SeekingAlpha, TheStreet, MSN, and others.