Apple Stock Slips After New Year's Downgrade

Options traders are blasting the stock to start the new year

Deputy Editor
Jan 2, 2024 at 10:22 AM
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Barclays downgraded 'Magnificent Seven' member Apple Inc (NASDAQ:AAPL) to "underweight" from "equal weight," and issued a modest price-target cut to $161 from $160. The analysts pointed towards weak iPhone 15 and other product volumes, and said the tech giant's price-to-earnings (P/E) ratio of 28.7 isn't "sustainable."

The bear note has AAPL down 1.4% at $187.87 at last check, though they opened the new year at $187.15. The shares just wrapped up their third annual win in the last four years, and maintain a more than 45% year-over-year gain. Today's losses, however, have Apple stock trading back below its 40-day moving average for the first time since early November.

Still, analysts are overwhelmingly bullish on the stock, especially so considering the tech-heavy Nasdaq-100 Index (NDX) added more than 50% in 2023. Of the 28 covering brokerages, just eight rate the equity a tepid "hold," though its 12-month average target price of $199.14 -- a 6% premium to AAPL's current perch -- suggests more price target adjustments to the lower side could be on the way. 

Options traders have something to say, too. Already today, 204,000 puts and 173,000 calls have been traded, volume that is double the average intraday amount. Most popular is the February 190-put, while new positions are being sold to open at the second most popular contract, the weekly 1/5 190-strike call. 

 

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