KeyBanc Capital Markets has taken a bearish stance on Apple stock ahead of the company's quarterly earnings report scheduled for July 28, 2026.
The firm initiated coverage with an Underweight rating and set a price target of $250, implying a potential 26% decline from recent trading levels.
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This pessimistic outlook comes despite Apple shares gaining 24% this year, significantly outperforming the S&P 500's 8% advance.
Analysts point out that Apple's valuation metrics are currently above historical averages, with a forward price-to-earnings multiple of 31.6 times compared to its 10-year average of 24.8 times.
KeyBanc Analyst Warns of Slowing Growth
Brandon Nispel, analyst at KeyBanc Capital Markets, argued that investors are overlooking broader fundamental risks by treating Apple as a safe-haven asset amid tech sector volatility.
He stated that as Apple raises iPhone prices, unit growth will slow, which in turn will slow user growth and ultimately Services growth.
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Nispel also highlighted concerns about the valuation multiples applied to Apple's financial results.
With Apple trading at approximately 34 times P/E and shifting from volume-led to pricing-led growth, he believes investors should apply a lower multiple, making the stock overvalued at current levels.
Apple's enterprise value-to-EBITDA ratio currently stands at 26.9 times against its 10-year average of 18.3 times, while its forward enterprise value-to-sales ratio is 8.8 times compared to the historic 6.2 average.
Contrasting Views from Other Wall Street Firms
In contrast to KeyBanc's bearish stance, other major Wall Street firms maintain a bullish perspective on Apple's long-term prospects, particularly regarding its integration of artificial intelligence features.
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Goldman Sachs analyst Michael Ng noted that continued iteration of integrated AI feature releases should support longer-term demand for product offerings and Services growth through monetization of new apps and increased iCloud storage demand.
