Key Takeaways
- Apple shares are riding high following the release of its first foldable iPhone, the iPhone Duo.
- Morningstar senior equity analyst William Kerwin welcomed new CEO John Ternus’s emphasis on AI during his inaugural launch event.
- Margins remain a key concern for the Cupertino company, with memory costs on the rise.
Apple’s AAPL stock is on the ascent after the launch of its much-anticipated foldable smartphone.
The iPhone Duo, which retails for around USD 2,000, was unveiled last week alongside a suite of signature Apple products, providing an early boost for new CEO John Ternus. Apple’s stock is up 5% since the release, and 23% year-to-date—close to all-time highs. But, amid fierce competition in the rapidly evolving AI space, can shares continue to climb?
What Is Driving Apple’s Stock?
The company also used its launch event to unveil the latest generation of Apple Intelligence, its AI platform built into iPhones, iPads, Macs, Watches and Siri functionality. It comes as Apple seeks to position itself as an AI beneficiary without all of the risks associated with Big Tech’s bumper infrastructure buildout.
Morningstar senior equity analyst William Kerwin welcomed Ternus’s emphasis on AI during his inaugural launch event speech, noting that Apple is carving out its niche, specifically focusing on “device interaction and personalized services.”
However, Apple is reckoning with a global memory crunch, with higher input costs posing a threat to margins. Even with product price increases, Kerwin sees Apple “sharing the pain” with consumers. He expects margins to compress by around 1% in fiscal 2027, before expanding again in 2028 as supply constraints ease.
So, are Apple shares a buy in 2026?
Can Apple Shares Rise Further?
With a market cap of $4.8 trillion, Apple ranks as the second most valuable company in the world after Nvidia.
Apple’s stock is now trading at USD 333 a share, just shy of its July 2026 peak. Morningstar last week raised its fair value estimate for the stock to USD 290 from USD 285 on slightly higher pricing assumptions. But with shares trading firmly above that, CEO John Ternus’ task now is to keep people paying more for both Apple’s products, and its shares.
