Jefferies has lowered its 12-month price target on Apple Inc. (AAPL) to $276.47, down from $283.36, while maintaining a Hold recommendation as investors await the company’s next quarterly report, scheduled for January 29. The firm’s adjustment accompanies concerns about a slowdown in Apple’s services segment, which has been identified as a growing contributor to revenue but is showing signs of deceleration.
Apple, with a market capitalization of $3.65 trillion, has fallen 8.76% year-to-date and has already retraced roughly 13% from a December 2 peak, according to Jefferies analyst Edison Lee. InvestingPro data cited by analysts indicates the stock’s relative strength index signals it may be in oversold territory following the pullback, a technical observation some investors use when evaluating near-term risk and timing.
Jefferies referenced Sensor Tower estimates indicating App Store revenue expanded by around 7% in the December quarter. The firm notes that this growth rate represents the slowest pace observed in the last seven quarters, raising questions about the durability of service-related revenue momentum.
Alongside the App Store data, Jefferies flagged a risk that Apple’s Google-related advertising revenue could slow to the high single digits. Despite these service-side headwinds, the firm kept its hardware projections unchanged while trimming its service revenue growth assumptions.
On near-term earnings expectations, Jefferies still anticipates Apple will modestly top consensus by roughly 3% when it reports on January 29. For fiscal years 2026 and 2027, Jefferies’ estimates sit in line with consensus forecasts. The firm highlights valuation metrics, noting Apple trades at a price-to-earnings ratio of 33.28 and a PEG ratio of 1.43; Jefferies concludes that, at 2.4 times the PEG ratio, the shares are likely to trade in a range rather than break out.
InvestingPro’s Fair Value analysis, as cited by market observers, suggests Apple appears slightly overvalued under that framework, with additional detail available in the Pro Research Report on the company.
Other major brokerages have expressed differing views ahead of the same earnings release. Morgan Stanley reiterated an Overweight rating and set a $315 price target, while cautioning the stock could trade "sideways to modestly lower" after the company’s announcement but identified potential strength tied to the iPhone 17. UBS maintained a Neutral rating and a $280 price target, pointing to robust iPhone 17 demand and forecasting a 12-13% year-over-year increase in unit sales for December 2025. KeyBanc reiterated a Sector Weight rating, citing a neutral risk/reward profile.
Beyond near-term financials, product and strategic initiatives remain in focus. Reports indicate Apple is developing an AI-powered wearable pin equipped with cameras, speakers, and wireless charging capability. Separately, the company is in discussions with Mastercard and Visa about launching a digital payments service in India, with a phased rollout targeted for 2026, subject to necessary approvals.
As Apple moves toward its earnings release, analysts and investors will be watching whether services can reaccelerate and whether any advertising weakness becomes more pronounced. For now, Jefferies’ adjustment and the range of views from other firms reflect a market weighing near-term operational signals against a stock that carries premium valuation metrics.