Jefferies Downgrades Apple Stock to "Underperform"

Jefferies downgraded Apple's stock rating from "Hold" to "Underperform" and lowered its price target from $285.56 to $263.66, implying approximately a 16% decline compared to Friday's closing price.

According to the broker's assessment, Apple may have canceled the fully titanium iPhone planned for 2027, as its production proved problematic due to low yields. According to Jefferies analysts, the anniversary model was supposed to have an average selling price of approximately $2,060, and extending a similar design to Pro and Pro Max models in the future would have helped Apple increase its average selling price and margins.

Against the backdrop of the plan's cancellation, Jefferies lowered its forecast for iPhone average selling price growth for 2026-2031 from 9% to 6.8%. Additionally, EPS forecasts for fiscal years 2028 and 2029 were lowered by 2.1% and 3.4%, respectively.

In the event of the fully titanium model's cancellation, according to analysts, the foldable iPhone will become Apple's primary driver of premium pricing and margin growth. However, increased memory component costs could raise the initial price of the iPhone 18 Fold to $2,199, with the 2TB version reaching $3,099.

Following the news, Apple's shares declined approximately 1.2% in pre-market trading.