A Wall Street analyst on Friday downgraded Apple (AAPL) stock to the equivalent of a sell rating ahead of the company’s September-quarter earnings report.

KeyBanc Capital Markets analyst Brandon Nispel lowered his rating on Apple stock to underweight from sector weight and set a price target of 200.

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On the stock market today, Apple stock rose 0.4% to close at 231.41.

Nispel cited his firm’s recent consumer survey and lower-than-expected upgrade rates for the iPhone 16 for his downgrade.

“We think the data suggests a slow upgrade path,” Nispel said in a client note.

Quarterly reports from U.S. carriers AT&T (T), T-Mobile US (TMUS) and Verizon Communications (VZ) showed slowing iPhone upgrade rates, he said.

“We continue to believe upgrade rates will be down mid-single digits in Q4 and low single digits in first-half 2025,” he said.

Also, consensus estimates for 2025 growth at Apple are “unrealistic,” Nispel said.

Apple Stock Down Before Fiscal Q4 Report

“Consensus expects Apple ’25 revenue growth to accelerate higher and to grow across all product categories and geographies,” he said. “As we look at historical data, these appear to be aggressive assumptions: Apple has grown all product categories at the same time just one out of the past 10 years (’21), and two times out of the past 20 years (’11 and ’21).”

Nispel also doesn’t see Apple Intelligence, the company’s take on artificial intelligence, accelerating sales. Apple plans to roll out the first batch of Apple Intelligence features next week in a software update for iPhone 15 and 16 handsets.

Meanwhile, Apple will report its September-quarter results late Thursday. Analysts expect Apple to earn $1.60 a share, up 10% year over year, on sales of $94.4 billion, up 5%, in its fiscal fourth quarter. The report will include the first 10 days or so of sales of Apple’s iPhone 16 smartphones, Apple Watch Series 10 smartwatches and AirPods 4 wireless earbuds.

Apple stock fell earlier this week after TF International Securities analyst Ming-Chi Kuo said Apple cut its iPhone 16 orders by about 10 million units for the fourth quarter and first half of 2025.

Other Analysts Maintain Buy Ratings

Other analysts on Friday also chimed in on Apple’s prospects.

TD Cowen analyst Krish Sankar reiterated his buy rating on Apple stock with a price target of 250.

In a client note, Sankar said he expects Apple to match estimates for the September quarter and guide “in line to below consensus” for the December quarter.

BofA Securities analyst Wamsi Mohan kept his buy rating on Apple stock with a price target of 256.

Mohan predicted Apple will report a “small beat” for the September quarter and give “better-than-expected” guidance for the current quarter.

“We expect iPhone demand will pick up post initial release of Apple Intelligence in late October,” he said in a report.

Apple stock is on the IBD Tech Leaders list.

Follow Patrick Seitz on X, formerly Twitter, at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.

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