Apple (AAPL) shares drop after analyst predicts iPhone sales will disappoint

901
SHARE
Apple

The shares of Apple Inc. (NASDAQ: AAPL) declined after an analyst predicted that the iPhone sales will disappoint and downgraded the tech giant’s stock rating.

On Monday, AAPL shares were trading $199.43 each, down by more than 2 percent at around 2:27 in the afternoon in New York.

Apple fundamentals are deteriorating

Rosenblatt Securities analyst Jun Zhang downgraded his rating for AAPL shares to sell from neutral due to concerns that Apple’s fundamentals are deteriorating.

In a note to clients, Zhang wrote, “We do not think Apple is a short (the company has plenty of cash and a meaningful stock buyback program); however, we believe Apple will face fundamental deterioration over the next six to 12 months.”

Additionally, Zhang warned that Apple experienced lackluster iPhone sales in the second quarter and will likely reduce its production of iPhone XR.

“We believe Apple reduced iPhone XR production for Q3 in order to prepare for the ramp of the new iPhone models and because of weakness in sales in Q2,” according to Zhang.