The holiday season has come with a sobering forecast for Apple Inc. (NASDAQ:AAPL), with the latest warnings from KeyBanc Capital Markets analyst Brandon Nispel throwing the company’s prospects into doubt.
The Apple Analyst:KeyBanc Capital Markets analyst Brandon Nispel holds a Sector Weight rating on Apple shares.
This marks a significant shift from the company’s historical performance, with hardware revenue anticipated to grow by 38% sequentially. This contrasts sharply with the three-year average growth of 62% for this period and the current consensus estimate of 41% quarter-over-quarter growth.
KeyBanc’s assessment is largely based on its KeyBanc First Look Data, which reveals a 27% month-over-month increase in indexed spending in December, falling below the three-year average of 37%. This indicates a weak quarter for Apple in terms of spending and revenue, underperforming compared to historical trends.
Despite these ominous signs, KeyBanc’s December carrier survey brought a glimmer of hope for Apple. iPhone sell-through tracked in line with store expectations, showing improvement month-over-month. Furthermore, demand for the iPhone 15 Pro/Max remained robust, while regular 15/Plus demand stayed solid, buoyed by holiday momentum.
Contrary to KeyBanc’s FLD, which suggested weaker-than-seasonal iPhone sales growth, inventory levels actually declined slightly compared to the previous year. While the overall outlook remains muted, these positive indicators did offer a brief respite for the tech giant amidst an otherwise bleak forecast.
Considering the current market standing, KeyBanc views the stock as fairly valued and expects it to perform in line with the Nasdaq, with AAPL trading at 18.3x 2025 adj. EBITDA, compared to the 3/10-year/peer average at 18.9x, 12.1x, and 13.4x, respectively.
Apple ended Tuesday’s session down 0.23% at $185.14. The stock has shed about 4% so far this year amid negative analysts’ actions and macro worries.