The Zacks Analyst Blog Highlights Apple, Dell Technologies, HP and Microsoft

For Immediate ReleaseChicago, IL – January 28, 2025 – Zacks.com announces the list of stocks 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, Dell Technologies DELL, HP HPQ and Microsoft MSFT.Here are highlights from Monday’s Analyst Blog:Buy, Sell or Hold Apple Stock? Key Tips Ahead of Q1 EarningsAppleis set to report its first-quarter fiscal 2025 results on Jan. 30.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.Apple expects the December quarter's (first-quarter fiscal 2025) revenues to grow low to mid-single digits on a year-over-year basis. Apple's fourth-quarter fiscal 2024 net sales increased 6.1% year over year to $94.93 billion.The Zacks Consensus Estimate for fiscal first-quarter revenues is currently pegged at $124.04 billion, indicating growth of 3.73% year over year.The consensus mark for earnings is currently pegged at $2.36 per share, unchanged over the past 30 days. The figure indicates a 8.26% increase from the year-ago quarter.AAPL's earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the earnings surprise being 5.05%, on average.Let's see how things are shaping up prior to this announcement.Apple's iPhone Sales Likely to Fall in Fiscal Q1Apple's fortunes are heavily reliant on the iPhone, which is by far its biggest revenue contributor. The device accounted for 48.7% of net sales in the fourth quarter of fiscal 2024, wherein sales increased 5.5% year over year to $46.22 billion.iPhone sales are likely to have suffered from stiff competition in China from Chinese vendors, including Huawei and Xiaomi. A delay in the launch of Apple Intelligence to a major part of Apple's installed base has been a concern.The Zacks Consensus Estimate for fiscal first-quarter iPhone net sales is pegged at $69.189 billion, suggesting 0.7% year-over-year decline.AAPL's Services Growth to Remain Steady in Fiscal Q1The weakness in iPhone sales is expected to be partially negated by the steady growth of the Services segment. An expanding paid subscriber base has been a key catalyst for the Services business, which is riding on the increasing popularity of the App Store and an expanding installed base of devices, albeit with a worsening regulatory environment.Apple has more than 1 billion paid subscribers across its Services portfolio, offering Apple TV+, Apple Arcade, Apple News+, Apple Card, Apple Fitness+ and Apple One bundle.For the Services segment, Apple expects a double-digit growth rate similar to fiscal 2024. The consensus mark for Services is currently pegged at $26.176 billion, suggesting 13.2% growth on a year-over-year basis.Apple's Mac Sales to Rise Y/YApple's Mac shipment is expected to have increased 17.3% year over year in the fourth quarter of calendar 2024, per IDC data. The iPhone maker is estimated to have shipped 7 million Macs, grabbing a market share of 10.1% compared with 8.8% in the year-ago quarter.Apple's estimated shipment growth rate is the largest in IDC's vendor list, followed by ASUS and Lenovo's growth of 11.7% and 4.8%, respectively. Dell Technologies and HP saw a shipment decline of 0.2% and 1.7%, respectively.In terms of market share, Lenovo maintained the #1 position with 24.5%, trailed by HP and Dell Technologies' 19.9% and 14.4%, respectively. Apple's market share improved from 8.8% in the year-ago quarter to 10.1%.IDC estimates 68.9 million sold units in the fourth quarter of 2024, up 1.8% year over year. In contrast, Gartner estimates shipment of 64.4 million units, up 1.4% year over year. In Gartner's list, ASUS gains the most in terms of shipments (up 9.8%), followed by Apple (shipments up 4.6%).AAPL Shares Underperform SectorApple shares have returned 16.2%, underperforming the Zacks Computer & Technology sector's return of 27.5%.Apple stock is not so cheap, as the Value Score of F suggests a stretched valuation at this moment.In terms of the forward 12-month Price/Earnings, AAPL is trading at 28.97X, higher than the Zacks Computer & Technology sector's 27.54X.AI Focus Aids AAPL's ProspectsAAPL has been on the investors' radar thanks to its AI push with the introduction of Apple Intelligence, an advanced personal intelligence system seamlessly integrated into iOS 18, iPadOS 18 and macOS Sequoia.Apple's AI push is expected to bring consumer-focused AI-enabled PCs into the market, thereby aiding PC shipments in the long haul.AAPL has been playing catch-up in the AI space compared with Alphabet, Microsoft and Amazon, its peers in the "Magnificent 7" group. Following the launch of Apple Intelligence, its competitive position is expected to improve.Leveraging the power of GenAI models, Apple Intelligence aims to enhance user experience across iPhone, iPad and Mac by combining robust language and image understanding with personal context. This technology, powered by Apple silicon, promises to simplify and accelerate everyday tasks while maintaining Apple's stringent privacy standards.The Services business benefits from the growing demand for Apple TV+ content and the adoption of Apple Pay. It recently expanded Tap to Pay on iPhone to more markets, including the United Arab Emirates, Chile, Japan, Canada, Italy and Germany. Apple Pay is now available in countries like Egypt and Uruguay.The expanding content portfolio for Apple TV+ is noteworthy.Apple – China Headwind Makes the Stock a Risky BetApple's near-term results are expected to bear the brunt of the weakness in China. A delay in the launch of Apple Intelligence is a concern, along with reported bugs. A stretched valuation is a concern.Currently, Apple carries a Zacks Rank #4 (Sell), which implies that investors should avoid the stock right now.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 +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.Today you can access their live picks without cost or obligation.See Stocks Free >>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.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>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 Report Microsoft Corporation (MSFT): Free Stock Analysis Report HP Inc. (HPQ): Free Stock Analysis Report Dell Technologies Inc. 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