Apple shares fell as much as 4 percent Monday morning, on track for a second-straight day of losses due to mounting concerns about unsustainably high stock prices. The iPhone maker has now lost 7 percent of its value in just two days.
Lamba said investors already expect strong iPhone 8 sales in the coming product cycle, likely limiting gains in Apple shares. And the same consumers driving those solid sales this time around will likely not spend on a new iPhone soon, reducing potential growth in fiscal year 2018, the report said.
“We remain of the view that Apple maintains a very strong franchise and could continue to gain incremental share of the smartphone market; however, the pace of share gains will likely meaningfully moderate as the market becomes more saturated,” the report said.
Some on Wall Street also believe Apple’s recent downward volatility is a negative signal for the market.
“I’m not sure what the right value is for Apple, but it is extremely concerning to me, that a stock of this importance can trade like that – on virtually nothing!” Brean Capital’s Peter Tchir wrote in a note to clients Monday.
“After Friday’s price action, I can’t be anything but bearish near term. The ‘healthy’ rotation seems to hide the fact that for brief moments of time there was virtually no liquidity (at a price) for some of the biggest and most loved stocks,” Tchir added.