Bank of America Lowers Apple Price Target: What Traders Need to Know Ahead of Earnings Report

In a recent shift in sentiment, Bank of America has adjusted its price target for Apple (NASDAQ: AAPL) from $250 down to $240. This revision precedes the tech giant's upcoming fiscal second-quarter earnings report, scheduled for release on May 1. Despite this cut, the new target still offers a projection of about 17% upside from Apple’s shares as of Tuesday's market close.

Analyst Wamsi Mohan provided insights into the decision, highlighting a complex situation facing Apple. Although the bank has modestly raised revenue predictions for the March and June quarters, it has concurrently reduced forecasts for subsequent periods. This adjustment accounts for rising costs associated with managing a convoluted supply chain and significant delays in the anticipated rollout of an AI-enhanced Siri.

Mohan noted the current strategy wherein consumers might dash to their local Apple stores to avoid looming tariffs, particularly those imposed by recent U.S. trade policies targeting China. However, he cautioned that he expects this surge in demand to taper off in the long run. Apple has faced considerable headwinds in 2025, with its stock value plummeting by over 18%, significantly outstripping the S&P 500’s decline of 9%.

This downturn is partly attributed to President Trump's aggressive tariffs, which impose a staggering 145% duty on imports from China—where Apple’s flagship products like the iPhone are manufactured. To complicate matters further, Apple has postponed its plans for launching Apple Intelligence, its initiative in the AI space, which was originally set to debut alongside the iPhone 16 last fall.

Given these delays, Mohan has revised his full-year earnings per share estimates for Apple, projecting $7.25 on $412 billion in revenue for 2025, down from previous expectations of $7.30 and $411 billion. Similarly, forecasts for 2026 have been cut to $440 billion in revenue and $7.82 per share, down from earlier figures of $450 billion and $8.20.

For traders, the implications of this updated analysis are clear: navigating the waters of Apple’s stock will require keen attention to both tariff developments and the company's pace in AI advancements. As always, informed decisions will be critical in what appears to be a challenging landscape for one of the world’s most valuable companies.