Apple tumbles on worries over iPhone; Wall Street defends
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Apple (NASDAQ:AAPL) shares fell nearly 5% on Friday amid worries about the company's hardware sales, prompting Wall Street analysts to defend the company after it reported third-quarter results. 
Wedbush Securities analyst Dan Ives, who has an outperform rating on Apple (AAPL), said the iPhone and Services performance were "strong" but that the rest was noise, citing a headwind of at least 400 basis points from foreign exchange.
"[The] iPhone came in below the Street but would have beat the Street excluding headwinds as iPhone 14 demand has remained strong with higher ASPs front and center and a solid China performance," Ives wrote in an investor note.
Ives added that CEO Tim Cook talked about a "stable consumer demand environment" as China grew to 8% year-over-year, or 10% in constant currency and the company continues to see strength in emerging markets. 
Looking ahead, Apple (AAPL) CFO Luca Maestri said the company expects the September quarter year-over-year performance to be "similar to the June quarter" and that foreign exchange will impact revenue by more than 2 percentage points, which Ives perceived as "conservative."
"When excluding FX and focusing on the hearts and lungs iPhones and Services, this was a strong performance and guidance in our view and we would be strong buyers on any weakness," Ives, who boosted his price target to $230 from $220, added.
Citi analyst Atif Malik opened up a 90-day positive catalyst watch heading into September, when Apple (AAPL) is widely expected to launch its new iPhone.
Malik said that after the June quarter, going into the new iPhone launch, Apple (AAPL) has outperformed the Nasdaq five of seven times and the S&P 500 all seven times, or 8% on average since 2016.
J.P. Morgan analyst Samik Chatterjee reiterated his overweight rating on Apple (AAPL), noting that even though investors might "fret" at the hint of modestly weaker-than-expected guidance, the variances are minor and do not change the overall trajectory of Apple. 
"We continue to view the set up into FY24 for Apple to be positive with likely improvements in consumer spending from trough levels, which will return the company to healthy revenue and robust earnings growth, and drive an outperformance for the shares, led by increased appreciation from investors of the high predictability of outcomes."
KeyBanc Capital Markets analyst Brandon Nispel kept his overweight rating on Apple (AAPL), but said the firm is cautious in the near-term, noting that the upgrade cycle could be coming to a halt, as upgrade rates are at all-time lows.
Nispel added that even though user growth is more important than unit growth and that switchers hit an all-time high, there could be pressure on the stock because of the slowing upgrade cycle.
Rosenblatt Securities analyst Barton Crockett was a bit more pessmistic and downgraded the stock to neutral from buy, citing "mixed" third-quarter results.
Crockett noted that the iPhone is the most important device in the modern economy, but it's likely that a slowdown in the U.S. lasts until a "material" new product category takes hold.
Analysts are largely cautious on Apple (AAPL). It has a HOLD rating from Seeking Alpha authors, while Wall Street analysts rate it a BUY. Conversely, Seeking Alpha's quant system, which consistently beats the market, rates AAPL a HOLD.
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