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Apple stock slips after Barclays downgrade ahead of projected sales slowdown

Apple stock slips after Barclays downgrade ahead of projected sales slowdown
Shares of the iPhone maker dropped 0.5 percent to $119.41 in premarket trading following a downgrade by Barclays to 'equal-weight' from 'overweight' due to the absence of “meaningful upside potential” in the stock.

Barclays' analysts do not expect Apple to show stronger sales this year, saying investors are putting too much stock in the next iPhone expected in September.

“Our chief concern is that investors increasingly are hoping for a meaningful exit rate (10 percent-plus year-over-year unit growth) led by the iPhone 8 cycle in the second half of 2017. Our view is that customers are increasingly mixing down (iPhone 6S in favor of iPhone 7) and maturation of the device-centric consumer electronics adoption wave could weigh on both Apple and the smartphone market,” Barclays analyst Mark Moskowitz wrote in a note distributed to clients, as quoted by Business Insider.

The London-based multinational still sees Apple as a good stock for long-term investors, saying that sales might return in 2018.

“Long-term growth opportunities related to India, services, the enterprise, artificial intelligence, and maybe even the Cloud still exist; however, we do not expect these potential 'what’s next?' opportunities to emerge as major needle movers over the next 12 months for Apple’s model,” Moskowitz wrote.

Barclays reduced the company’s 12-month share price target to $117 from $119. “This call is not on the quarter,” according to the note.

READ MORE: Apple biggest tax avoider in US stashing $215bn offshore

Apple's quarterly earnings report is scheduled for January 31. The corporation’s shares have risen two percent in the past three months and 18 percent in the past year.

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