Apple's stock falls for the eighth straight day. Here's what investors might be missing.

By Christine Ji

Apple's stock could rebound thanks to overlooked strength in iPhone demand and a new AI strategy, according to Evercore

Apple's revenues could surprise Wall Street by over $3 billion for the December quarter, according to some analysts.

Apple's stock has had a rough start to the year, but one analyst sees good news around the bend.

Shares of Apple (AAPL) were down for an eighth consecutive trading day on Friday, shedding 5.7% over that span. If the stock ends Friday's session in the red, it will seal its longest losing streak since May 2025, according to Dow Jones Market Data.

The recent pullback reflects an assortment of concerns, including about slowing iPhone sales in China, an uncertain artificial-intelligence strategy and soaring memory costs. Earlier this week, Alphabet (GOOGL) (GOOG) officially surpassed Apple to become the second-largest company in the world, underscoring the negative sentiment toward Apple.

Read: How Alphabet surpassed Apple to become the second-most valuable company in the world

Evercore ISI Analyst Amit Daryanani sees a disconnect, however, between that sentiment and the fundamentals for Apple's stock. He refuted the pessimism in a Friday note, calling the stock a "top pick" and lifting his price target to $330 from $325. That implies the potential for over 25% upside.

Daryanani also raised his estimates for Apple's December-quarter results, which the company is scheduled to report on Jan. 29. Evercore is projecting revenue of $140.5 billion, which is $3.2 billion higher than the consensus $137.3 billion expectation. Evercore also anticipates earnings per share hitting $2.71, outpacing the consensus of $2.66.

He highlighted recent data that he suggested would refute bearish views of the iPhone business. During China's massive Singles' Day shopping event, iPhones accounted for 26% of all phone shipments, according to the Evercore report. In the U.S., demand is skewing heavily toward the more expensive Pro and Pro Max models - a development that could lift Apple's average selling price and boost its margins.

As memory prices rise due to explosive demand from AI infrastructure, some are worried that component costs will rise for Apple. But Daryanani pointed to Apple's existing pricing agreements, which he thinks will insulate the company from near-term price increases.

Read: The sneaky factor that Apple investors need to watch in the new year

Beyond iPhone sales and memory prices, another concern is plaguing Apple investors: the company's AI strategy, or lack thereof. Bears worry Apple is falling behind its "Magnificent Seven" peers without a well-defined roadmap to compete. However, Daryanani anticipates that Apple will soon release a tiered Apple Intelligence strategy, featuring on-device AI models as well as a secure private cloud for more complex tasks and optional access to larger external AI tools. That could preserve Apple's signature privacy standards and eliminate a key overhang for shares.

-Christine Ji

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

01-09-26 1223ET