Apple’s AI-enabled iPhone Expected to Boost Stock Price: Analyst Predicts Potential Rerating Before Launch of Major Upgrade Cycle

Apple is expected to release its rumored AI-enabled iPhone this fall, and analysts believe that the stock could potentially see a rerating as a result, according to a Wall Street analyst. Despite some near-term challenges in the company’s fundamentals, hedge fund investors are showing interest in Apple stock, as noted by JPMorgan analyst Samik Chatterjee. The recent decline in Apple shares has made the valuation more attractive in anticipation of a significant upgrade cycle for the iPhone.

Investors are increasingly interested in the potential of on-device AI technology, similar to the previous shift to 5G wireless networks with the iPhone 12. The upcoming iPhone 16 is likely to feature AI capabilities to appeal to consumers. Although Apple stock has declined around 13% year-to-date due to weakened hardware demand and slower services growth, Chatterjee still maintains an overweight rating on the stock while lowering his price target to 210 from 215.

Despite the challenges faced by Apple, the stock rose 0.5% in premarket trading to 168.68. Chatterjee anticipates a potential rerating of Apple stock prior to the launch of the AI iPhone. He believes that the major upgrade cycle for iPhones will occur with the iPhone 17 series in late 2025, when on-device AI technology will have expanded use cases.

For more stories on consumer technology, software, and semiconductor stocks, follow Patrick Seitz on social media. Other interesting articles include how Nvidia is using AI to validate humanoid robots and the impact of the AI chip boom on Taiwan Semiconductor Manufacturing’s Q1 sales beat. MarketSurge offers research, charts, data, and coaching all in one place for investors looking to stay informed. Check out