Morgan Stanley Lowers Apple Price Target to $355
Since this note+0% AAPL $333.02 → $333.40 (Oct 2) · 2% of the way to the target
Morgan Stanley analyst Erik Woodring lowered the price target on Apple (NASDAQ: AAPL) to $355 (from $360) while maintaining an Overweight rating.
“Apple’s product roadmap remains amongst the most exciting in over a decade, but our earnings outlook changes little following the iPhone launch, leaving limited upside to our PT after a strong L6M run.
The next 2+ years of product innovation under new CEO John Ternus are amongst the more exciting, and consequential, we can remember in recent history, leading to the first period of four consecutive years of iPhone unit growth since FY15, and EPS compounding at ~13% between FY26-FY28.
But as we digest what we learned since the iPhone launch, including pricing, specifications, lead times, Siri AI, Services pricing actions, and supply chain checks, we walk away with a model that is little changed from pre launch.
While lower-than-expected new iPhone model pricing modestly pressures our iPhone ASP and gross margin assumptions, this is largely offset by better iPhone unit expectations, continued Mac upside, and modest Services upside.
Combined, we continue to forecast ~$10 of EPS in FY27 and close to $11 of EPS in FY28, 0-3% above Street.
Preliminarily, September quarter earnings screens positively, supported by resilient iPhone builds, stronger Mac revenue, Services pricing tailwinds, and tariff refunds, but December quarter setup remains mixed, as Street estimates appear stale and have yet to incorporate the staggered iPhone launch, leading to iPhone shipments for the quarter that remain too elevated.”
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