CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
According to a Bloomberg report, AAPL is ending a decade-long effort to build an electric car. Ditching the car initiative could be seen as a near-term positive, in our view, as the news allows AAPL to improve cost efficiencies. More importantly, greater R&D spend can now be allocated toward AI initiatives, where we believe AAPL has a greater chance of success, and improving its overall ecosystem of products. While we think the car initiative likely offered the greatest long-term upside to AAPL’s revenue trajectory, it was also likely to erode margins. Still, we viewed the car initiative as more of a “pie in the sky” opportunity and investors are unlikely to see this as having major implications to the stock price as it wasn’t modeled into our (and most) long-term expectations. AAPL continues to have a slew of growth opportunities ahead of itself, with the three to five year focus on the hardware side now shifting to initiatives like AI, spatial computing, health care, and foldable devices, among other things.