Apple (AAPL) shares are oversold after underperforming by nine points compared with S&P 500 for the past one month, Morgan Stanley said in a note Monday.
“Apple shares are oversold, and we’d be buyers of weakness,” Morgan Stanley analysts said.
The reasons the investment firm noted were two downgrades and a recent New York Times report on the US Department of Justice’s anti-trust investigation against the company.
The report also pointed to uneven product demand while Services is outperforming, creating volatility in investor sentiment.
“However, we are picking up signs that Apple’s Gen AI efforts are accelerating, increasing the probability of an LLM-enabled OS launch and device upgrade cycle,” the analysts said.
The investment firm reiterated its overweight rating with a price target of $220.