Post Views: 6
Is the tide starting to turn for Apple ? The latest commentary from White House officials and Wall Street analysts suggests a path forward for the iPhone-maker. The already troubled Club stock this year fell off a cliff a session after President Donald Trump ‘s April 2 announcement of sweeping “reciprocal” tariffs that he called “liberation day.” Shares have been clawing their way back from their 2025 lows on April 8 of under $170 apiece. Apple got a reprieve on April 9 when the worst of Trump’s sweeping global tariffs went on a 90-day hold at 10%, excluding China, which sent the tech stock soaring 15%. Broad exemptions were made for electronics imports, including smartphones and computers, a few sessions later. Neither tariff relief measure, however, provides Apple with any long-term assurances. The company, in turn, has been trying to move more of its iPhone manufacturing to India from China. Treasury Secretary Scott Bessent gave Apple some promising news Monday, telling CNBC in an interview that a trade agreement with India could be announced soon. Presumably, India has been working to secure a better deal than the 26% tariff rate it was assigned on “liberation day.” But even at that level, India would be a far cry better than China, which has been hit with a tariff of 145%. While supporting Apple’s manufacturing move to India in the near term, JPMorgan said the tech giant should also continue to pump money into the U.S., to try to align with Trump’s call to bring more jobs and resources to the country. Last month, Apple said it would invest $500 billion in America over the next four years. AAPL YTD mountain Apple (AAPL) year-to-date performance Morgan Stanley, meanwhile, forecasted more upside for Apple shares ahead of its fiscal 2025 second-quarter earnings report after Thursday’s market close. While recognizing “tariffs, China, AI, iPhone growth, and regulatory [issues]” as key unknowns, the analysts on Monday raised their price target to $235 per share from $220. That implies more than 12% upside from Friday’s close and 2.7% above where the stock closed before the reciprocal tariff announcement. Apple shares have lost nearly 17% year to date versus the S & P 500 ‘s roughly 7% decline in 2025. “Given Apple remains the most underowned megacap in the world, we still see a path to our $235 price target and $284 bull case valuation, which we’d expect to be driven by both positive estimate revisions and multiple expansion, as strong [free-cash-flow] conversion and services growth remain underappreciated valuation tailwinds vs. other megacaps,” wrote the analysts, who maintained a buy-equivalent rating. For the quarter, Morgan Stanley predicted a “strong iPhone sell-in pull-forward and a weaker [U.S. dollar] should help to drive moderate upside to March quarter results and a June quarter revenue guide in line with consensus.” In another bright spot, Morgan Stanley said last week the results of its March U.S. iPhone survey were “surprisingly positive.” The analysts pointed to an all-time high device upgrade intention rate and better-than-expected engagement with the company’s generative AI system, Apple Intelligence. Bottom line What we need the most right now is clarity about how this tariff saga will play out for Apple in China. That’s when we should know if the tides are truly turning for the tech giant’s stock. After all, Apple is on borrowed time, and it doesn’t seem like this pause will last. That’s why Apple has been a difficult stock to own under Trump’s regime, Jim Cramer wrote in his Sunday column on April 13. He also wrote, “It is an imperative to cut back this [Apple] position tomorrow [April 14] into any strength.” A few days later, Jim retired his “own it, don’t trade it” mantra on both Apple and Nvidia , whose shares have also suffered under the new administration. Due to our trading restrictions on stocks that Jim mentions on television, the Club was finally free to trim both Apple and Nvidia last Monday. As for Apple moving into India, we’re glad management continues to diversify its supply chain, but we’re not convinced it’s enough to mitigate the risks to the company’s bottom line. “The company’s shifting of some production to India, the default destination for the iPhone, may not be what the president wants. There are hardliners within the government who want no exemptions,” Jim wrote on April 13. With Apple’s quarterly earnings report later this week, we’re unlikely to find out more about trade policy from the White House before then. Still, we’ll be curious to see how management is thinking about supply chain diversification broadly, investments in the U.S. to appease the Trump administration, and how its high-margin services business is performing. (Jim Cramer’s Charitable Trust is long AAPL, NVDA. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
The Apple Fifth Avenue store in New York, US, on Monday, Feb. 24, 2025.
Michael Nagle | Bloomberg | Getty Images
Is the tide starting to turn for Apple?
