Advertisement
U.S. markets open in 4 hours 41 minutes
  • S&P Futures

    5,306.25
    -2.00 (-0.04%)
     
  • Dow Futures

    40,146.00
    +2.00 (+0.00%)
     
  • Nasdaq Futures

    18,495.50
    -8.25 (-0.04%)
     
  • Russell 2000 Futures

    2,134.00
    -4.40 (-0.21%)
     
  • Crude Oil

    81.86
    +0.51 (+0.63%)
     
  • Gold

    2,216.90
    +4.20 (+0.19%)
     
  • Silver

    24.58
    -0.18 (-0.72%)
     
  • EUR/USD

    1.0793
    -0.0036 (-0.33%)
     
  • 10-Yr Bond

    4.1960
    0.0000 (0.00%)
     
  • Vix

    12.97
    +0.19 (+1.49%)
     
  • GBP/USD

    1.2609
    -0.0029 (-0.23%)
     
  • USD/JPY

    151.3760
    +0.1300 (+0.09%)
     
  • Bitcoin USD

    70,779.19
    +1,079.52 (+1.55%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • FTSE 100

    7,952.85
    +20.87 (+0.26%)
     
  • Nikkei 225

    40,168.07
    -594.66 (-1.46%)
     

Apple Likely to Face Class-Action Lawsuit for iPhone Issue

Apple’s AAPL revelation of software updates slowing iPhones with older batteries last December resulted in an uproar among its users.

The Wall Street Journal (WSJ) recently reported that at least 59 separate lawsuits have been filed against Apple by around five dozen customers. Moreover, a legal meeting is scheduled today in Atlanta to possibly combine all the cases into one class-action lawsuit, adds WSJ.

Experts find the number of cases filed against the iPhone maker unusual. It is almost thrice than the number filed in 2010 over iPhone 4’s call drop issue.

Notably, shares of Apple have returned 15.5% over the last year, underperforming the industry’s16.9% rally.



iPhone Losing Steam

Apple has been apologizing for the lack of transparency relating to the handling of iPhone performance with older batteries but denied of doing anything intentionally to shorten the life of a product. However, nothing seems to pacify consumers.

Apple, in order to appease aggrieved customers, lowered the price of an out-of-warranty battery replacement by $50 for anyone with an iPhone 6 or later model.

Per Barclays, owing to the offer more users will go for battery replacements rather than upgrading to new iPhones. They project a decline of 16 million in iPhone shipments this year, which equates to nearly $10.3 billion loss in revenues.

Moreover, we observe that the spurt in revenues from iPhone in the last reported quarter was due to higher iPhone average selling price (ASP), when total shipments witnessed a decline.

However, the expensive price tag might prove an impediment in markets like China, which remains an important market for Apple, given the growing number of middle-class customers. Also, intensifying competition from regional players, who are offering feature-rich smartphones at a much cheaper price, remains a major headwind.

Recently, Goldman Sachs trimmed iPhone sales expectations by 1.7 million units to 53 million for the March quarter. For the quarter ending June, the firm forecasts sales of 40.3 million units, a decline of 3.2 million from its previous projection.

Apple Inc. Revenue (TTM)

Apple Inc. Revenue (TTM) | Apple Inc. Quote

Zacks Rank & Stocks to Consider

Apple carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the broader technology sector are NVIDIA Corporation NVDA, Western Digital Corporation WDC and Paycom Software PAYC, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth for NVIDIA, Western Digital and Paycom is projected to be 10.3%, 19% and 25.8%, respectively.

Investor Alert: Breakthroughs Pending

A medical advance is now at the flashpoint between theory and realization. Billions of dollars in research have poured into it. Companies are already generating substantial revenue, and even more wondrous products are in the pipeline.

Cures for a variety of deadly diseases are in sight, and so are big potential profits for early investors. Zacks names 5 stocks to buy now.

Click here to see them >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Western Digital Corporation (WDC) : Free Stock Analysis Report
 
Paycom Software, Inc. (PAYC) : Free Stock Analysis Report
 
Apple Inc. (AAPL) : Free Stock Analysis Report
 
NVIDIA Corporation (NVDA) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.

Advertisement