Tue Oct 29 20:50:00 UTC 2024: ## Apple Stock Poised for a Fall: Analyst Predicts Price Drop Below $200 by Year’s End

**[City, State] -** Despite its current trading price of around $230, Apple (AAPL) stock is facing a looming correction, according to Keithen Drury, a financial analyst for The Motley Fool. Drury believes that the stock’s fundamentals do not justify its current valuation and predicts a decline to below $200 by the end of the year.

Drury points to Apple’s stagnating revenue growth as a major concern. While the company has enjoyed massive success with its devices, revenue has remained flat since 2022, a worrying sign for a company reliant on consistent growth to maintain its stock price.

Early indications for Apple’s upcoming quarterly earnings report, due on Halloween, are not promising. Sales of the iPhone 16, which accounts for roughly half of Apple’s total revenue, are reportedly lagging behind expectations, causing Wall Street analysts to lower their earnings per share (EPS) projections.

Adding to the bearish outlook, Apple’s stock currently trades at a hefty premium compared to its earnings, with a price-to-earnings (P/E) ratio of 35 times trailing earnings and 31 times forward earnings. While other companies command similar valuations, they are achieving impressive growth numbers, making Apple’s premium appear unjustified.

Drury highlights the importance of earnings growth for long-term stock performance, noting that while Apple’s recent earnings growth is in line with the S&P 500’s historical average, its significantly higher valuation makes it vulnerable to a correction.

“There are way too many stocks I can buy right now that trade at far cheaper valuations that are growing faster than Apple,” Drury states. “Buying these stocks instead of Apple will likely boost my long-term returns, so they make for much better buys.”

Drury concludes that Apple’s current price tag is unsustainable unless the company delivers exceptional results. Given the early indicators suggesting a lackluster performance, he predicts a potential drop below $200 for AAPL by year’s end.

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