The Zacks Analyst Blog Apple, Microsoft, Alphabet and Amazon

For Immediate ReleasesChicago, IL – February 13, 2025 – Zacks.com announces the list of stocks and ETFs featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Apple (AAPL), Microsoft MSFT, Alphabet GOOGL and Amazon AMZN.Here are highlights from Thursday’s Analyst Blog:Apple Down -7% Year-to-Date on iPhone Weakness: Buy or Hold the Stock?Apple shares have declined 7.1% year to date, underperforming the broader Zacks Computer & Technology sector’s 1.5% growth. The company has been suffering from sluggish demand for iPhone in China amid increasing competition from the likes of Huawei and Xiaomi as well as lack of Apple Intelligence.Although iPhone sales decreased 0.8% year over year to $69.14 billion in first-quarter fiscal 2025, Apple saw better iPhone 16 sales in those regions where Apple Intelligence was available. iPhone’s active installed base grew to an all-time high and saw a record level of upgrades in the reported quarter. As per Kantar, iPhone was a top-selling model in the United States, Urban China, India, the U.K., France, Australia and Japan.Although Greater China sales decreased 11.1% year over year, Apple benefited from strong sales in a number of emerging markets, including India. In first-quarter fiscal 2025, the iPhone was the top-selling model in the country. The company saw double-digit growth in the installed base in the emerging markets.Apple launched the first set of Apple Intelligence features in U.S. English for iPhone, iPad and Mac, and introduced more features and expanded to more countries in December. Apple Intelligence is now available in Australia, Canada, New Zealand, South Africa and the U.K.In April, Apple is set to launch the next level of language updates with Apple Intelligence, including French, German, Italian, Portuguese, Spanish, Japanese, Korean, simplified Chinese, and localized English to Singapore and India. This is expected to boost iPhone upgrades and further increase in installed base.However, will this push the stock higher in 2025? Let’s dig deep to find out.Can Service Momentum Aid Apple’s Prospects?AAPL’s Services business is expected to drive top-line growth. It now has more than 1 billion paid subscribers across its Services portfolio, more than double what it had four years ago. The expanding content portfolio of Apple TV+, Apple Music and Apple Arcade, as well as the growing user base of Apple Pay, has helped drive subscriber growth.Although Apple’s business primarily runs around its flagship iPhone, the Services portfolio has emerged as the company’s strong growth driver. In the fiscal first quarter, Services revenues grew 14% year over year to $26.34 billion and accounted for 21.2% of sales.The Services business benefits from the growing demand for Apple TV+ content and the adoption of Apple Pay. It has expanded Tap to Pay on iPhone to more markets, including the U.A.E., Chile, Japan, Canada, Italy and Germany. Apple Pay is now available in countries like Egypt and Uruguay. The expanding content portfolio of Apple TV+ is noteworthy.Apple expects the March-end quarter’s (second-quarter fiscal 2025) revenues to grow low double digits on a year-over-year basis.AAPL Estimates Show Downward TrendThe Zacks Consensus Estimate for Apple’s second-quarter fiscal 2025 earnings has declined 4.2% to $1.61 per share over the past 30 days, indicating 5.23% growth from the figure reported in the year-ago quarter.Apple’s earnings beat the Zacks Consensus Estimate in the trailing four quarters, the average earnings surprise being 4.39%.Apple Inc. price-consensus-chart | Apple Inc. QuoteFind the latest EPS estimates and surprises on Zacks Earnings Calendar.Apple Shares OvervaluedThe AAPL stock is not so cheap, as the Value Score of D suggests a stretched valuation at this moment.Apple is trading at a premium with a forward 12-month P/E of 30.45X compared with the sector’s 26.88X and higher than the median of 29.85X, reflecting a stretched valuation.AAPL shares are now trading below the 50-day moving average, indicating a bearish trend.AAPL Shares: Buy, Sell or Hold?Apple’s AI push with Apple Intelligence is noteworthy. However, it is still playing catch up with the likes of Microsoft, Alphabet  and Amazon.Although the Services business has emerged as AAPL’s new cash cow, with an expanding content portfolio for Apple TV+, we believe that Apple Intelligence will take some time to go mainstream.Hence, we believe that Apple’s near-term growth prospects do not justify a premium valuation.AAPL currently has a Zacks Rank #3 (Hold), suggesting that it may be wise to wait for a more favorable entry point in the stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Why Haven't You Looked at Zacks' Top Stocks?Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year.Today you can access their live picks without cost or obligation.See Stocks Free >>Note: Sheraz Mian heads the Zacks Equity Research department and is a well-regarded expert of aggregate earnings. He is frequently quoted in the print and electronic media and publishes the weekly Earnings Trends and Earnings Previewreports. If you want an email notification each time Sheraz publishes a new article, please click here>>>Media ContactZacks Investment Research800-767-3771 ext. 9339support@zacks.com                                     https://www.zacks.com                                                 Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance  for information about the performance numbers displayed in this press release.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant 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 Amazon.com, Inc. (AMZN): Free Stock Analysis Report Microsoft Corporation (MSFT): Free Stock Analysis Report Alphabet Inc. (GOOGL): 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