Rosenblatt downgrades Apple on lack of AI-driven iPhone boost

Rosenblatt downgraded Apple (AAPL) to Neutral from Buy with a price target of $217, down from $223, following the fiscal Q2 report. Jefferies this morning also downgraded Apple, taking its rating to a sell-equivalent Underperform. The earnings print shows a company “with amazing supply chain skill, and better demand for iPhones than many had feared,” the analyst tells investors in a research note. However, for the stock to work, there needs to be an artificial intelligence driven “sharp acceleration” in iPhone sales, contends Rosenblatt. The firm believes that as time goes on, “the argument for that seems to be fading.” What’s left is a “well-run company, with OK-muted growth,” it argues. Rosenblatt thinks Apple needs an exciting new product to reinvigorate growth and points out the stock is trading at a premium multiple “in a choppy tariff and regulatory environment.”