Should Investors Buy the Post Earnings Dip in Apple Stock?

Amid heightened market volatility, investors may notice Apple’s AAPL stock has dipped nearly 5% since reporting very favorable results for its fiscal first quarter last Thursday. Despite surpassing top and bottom line expectations, tariff concerns along with the unexpected rise of "superior" AI infrastructure from Chinese company DeepSeek have led to a broader selloff. That said, let's see if it's time to buy the post-earnings dip in Apple stock or if the company’s exposure to China will lead to more short-term risk.Image Source: Zacks Investment Research Apple's Record Q1 Results Apple’s Q1 sales rose 4% year over year to an all-time high of $124.3 billion which edged estimates of $124 billion. Driven by iPad and MacBook growth, Product revenue was up 2% to $98 billion with Apple Services revenue spiking 14% to a record $26.3 billion.Furthermore, Apple’s Q1 earnings spiked 10% to a record $2.40 per share versus EPS of $2.18 in the comparative quarter. This also topped the Zack EPS Consensus of $2.36.Image Source: Zacks Investment Research China Risk & DeepSeek ConcernsWith Donald Trump back in office, the ensuing increase in tariffs against China puts Apple at the forefront of American companies that could be affected by retaliatory efforts. To that point, China has already implemented several regulations that have impacted Apple’s expansion in the People’s Republic such as stricter export controls and banning the use of the iPhone by government officials and employees at state-owned enterprises.Notably, Apple’s revenue in its Greater China segment fell 11% during Q1 to $18.51 billion compared to $20.81 billion a year ago. It’s also noteworthy that this noticeably missed the Zacks Consensus of $22.16 billion by -16% as shown in the geographic surprise chart below. Another concern is that the rumored wizardry of the DeekSeek free AI-Chatbot may take away from the exuberance of Apple Intelligence and slow sales for the upgraded product line of iPhones in China.However, Apple’s international expansion outside of China could help offset these risks with the company highlighting that it achieved record revenue records in the Americas, Japan, and the rest of Asia Pacific.Image Source: Zacks Investment Research Apple’s Revenue GuidanceOffering loose guidance for Q2, Apple expects low to mid-single digit revenue growth with the Zacks Consensus currently at $93.94 billion or 3% growth (Current QTR below). Based on Zacks estimates, Apple's total sales are now expected to increase 4% in fiscal 2025 and are projected to rise another 8% in FY26 to $443.07 billion.Zacks projections call for 8% EPS growth this year with Apple’s annual earnings forecasted to jump another 13% in FY26 to $8.31 per share.Image Source: Zacks Investment Research Final ThoughtsLanding a Zacks Rank #3 (Hold), there could be better buying opportunities ahead for Apple stock amid recent tariff concerns especially as it relates to China. DeekSeek could be an underlying threat in this region as well but Apple’s global market dominance and growth trajectory still makes the tech giant a suitable investment for long-term investors.Only $1 to See All Zacks' Buys and SellsWe're not kidding.Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent.Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators,and more, that closed 228 positions with double- and triple-digit gains in 2023 alone.See Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Apple Inc. (AAPL): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks