Analyst Reiterates Bullish Position on Apple Stock

J.P. Morgan Securities maintains an “overweight” rating and $200 price target

J.P. Morgan Securities today reiterated its position on Apple Inc (NASDAQ:AAPL), maintaining its “overweight” rating, $200 price target, and fiscal 2024 estimates. The analyst acknowledged other firms’ skepticism regarding AAPL’s prospects amid a slowdown of consumer spending and currency headwinds, but said better fiscal supply dynamics in the third-quarter “will overwhelm the modest demand weakness.”

Despite the bull note, Apple stock is muted ahead of today’s open, last seen down 0.4% to trade at $136.12. The equity has an intriguing entry point, sitting 23% lower year-to-date following three-straight monthly losses. What’s more, Apple stock is just one of two FAANG concerns to land on Schaeffer’s Senior Quantitative Analyst Rocky White’s list of 25 best stocks to own in July, which indicates near-term strength. In fact, the security has averaged a one-month return of 6.4% going back 10 years, with all but one of these returns being positive. 

Analyst sentiment is firmly bullish at the moment, with 19 of 21 in coverage rating the security a “buy” or better, coming into today. What’s more, the 12-month consensus price target of $186.73 is a 37.2% premium to last night’s close.

An unwinding of options traders’ pessimism could put more wind at the stock’s sails, as puts are being picked up at their quickest clip in a year. This is per AAPL’s 10-day put/call volume ratio of 1.04 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which stands higher than 100% readings from the past 12 months.

Mirroring this sentiment, short-term options traders have rarely been more put-biased than they currently are. This is per Apple stock’s Schaeffer’s put/call open interest ratio (SOIR) of 1.12, which stands in the 99th percentile of annual readings.

It’s also worth noting that the equity’s Schaeffer’s Volatility Scorecard (SVS) stands at 91 out of 100. This elevated score indicates AAPL has exceeded options traders’ volatility expectations over the past year — a boon for premium buyers.

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