Tech investor Dan Niles has raised concerns over Apple’s valuation ahead of its fiscal second-quarter earnings on May 2nd. Apple has underperformed the broader technology sector this year, with its shares down 14%. Niles believes that despite this pullback, the company’s valuation is still too high given its fundamentals.
Niles points to Apple’s stagnant revenue guidance for the past three years and the increasing competition from Huawei, which has led to market share losses in key countries like China. He also notes that Apple is lagging behind in the artificial intelligence race, and has recently explored partnerships with companies like Alphabet to catch up.
Given these challenges and the lack of growth, Niles questions why investors would choose Apple over other tech companies with higher growth rates and fewer competitive issues. He instead recommends looking at sectors such as industrials, healthcare, and fintech, which have been overlooked by investors.
Niles has previously been bearish on Apple and held a short position in the stock last year.
