42% of Apple Analysts rate it a Hold or Sell
by Horace Dediu
Another 10% do not provide a rating.
Over the past 20(!) years, Apple net income has grown at a compounded annual growth (CAGR) of 26.6%, Revenue growth has compounded at 21.5% and share price has compounded at at 27.7%. That means the company has been doubling at least every 3 years for more than 20 years.
The graph below shows share price and yearly earnings (and multiples of those earnings) since 2006. Note the vertical scale is logarithmic. The Price line has been growing at 27% or doubling every 2.6 years. The exercise of predicting the share price based on extrapolation is left to the reader.
In spite of this, data shows that 21 out of 49 analysts who follow Apple have the equivalent of a "Hold" or "Sell". An additional 5 follow it but have no opinion.
It takes significant courage to predict a reversal of a 20 year trend. That a majority of analysis implicitly or explicitly believe Apple is on the precipice of failure may come as a surprise given the recent rise in price and optimism around AI. The graph shows the percent of Hold/Sell/Underperform/no opinion has been rising.
The graph below shows the targets published recently.
The targets are sorted by rating and then value. The "Buy" rated are encapsulated, the rest have all the other ratings. The Red line is the average of all ratings. Some of the ratings and targets, especially the lowest, are out of date.
Extraordinary claims require extraordinary evidence. Of course, a 20 year trend can end, even a 50 year trend can end. But the longer it goes, the more important it is to understand why it has gone on for so long and therefore to understand how it can end. Arguments that it can end because "rising prices and/or delays for AAPL's component supplies, potentially slowing AAPL's rev growth, and/or lowering margins" don't counter a 20 year run of compounding 27% growth. Surely, supply chain management and cost hedging strategies are not a new problem.
The skeptical claims have not presented extraordinary evidence. The strongest has been that if AI can create an alternative to the user interface Apple pioneered, and if Apple would not be incentivized to embrace this new paradigm, and if enough users would abandon the comfortable and familiar digital life Apple affords them then Apple would slow or stagnate. There are a lot of "ifs" in this argument. Each more dubious than the other.
In contrast, the "flywheel" or momentum of serving 1.3+ billion users with iris-dilating products and services provided at premium positioning seems self-explanatory.
That almost 40% of the analysis covering Apple believe that it cannot deliver above-index average growth continues to amaze me.
We will be discussing this and other Apple-related topics at our upcoming June Office Hours on Tuesday, June 9th, 2026 (day after the WWDC'26 keynote.) Sign up today!
3 comments
Sacto Joe ·
Hence the sarcastic and perennial “Apple is doomed” statement.
Frankly, there’s zero doubt in my mind that prevalent attitude is why Apple went so strongly into buybacks. On average, they were bound to be buying back undervalued AAPL - and thus it has been the case for approaching 15 years resulting in the removal of approaching half of their split-adjusted float at the time, using cash that was given zero value by rank and file investors.
Hmm. I wonder if there’s any data on just how prevalent it’s been? My guess: bad as it still is, it was a great deal more so in years past.
FredHS ·
Ha! "iris dilating". That's the key - eyes on flat screens, from Watch to multi-screen pro versions of the Mac and all in between.
Forget Apple for a sec. Flat screens abound and proliferate everywhere. We are wired for visual input and for use of hands. HI, as in Human Intelligence, evolved as our brain evolved to maximize our eyes and hands.
Now back to Apple. They work really hard to give the best experiences leveraging eyes and hands. Apple already augments these experiences with AI. WWDC will reveal more ways AI will augment further.
deemery ·
Furthermore, most of those ANALysts have been predicting this kind of doom -consistently for years- without any tracking or accountability. It's hard to credit their "data" when they don't keep any data on their own prior performance.