Apple investors look for AI overhaul to power next leg of gains

Apple’s upcoming Worldwide Developers Conference (WWDC), starting Monday at its Cupertino headquarters, is poised to deliver long-awaited AI advancements that could redefine its stock trajectory. Investors have pushed for two years for the company to integrate AI into its products, particularly after rivals like Google and Microsoft capitalized on the trend. The event is expected to showcase a revamped Siri digital assistant and other AI features, which analysts believe could act as a catalyst for Apple’s stock, currently the second-best performer among the Magnificent Seven this year despite its delayed AI rollout. Analysts like Morgan Stanley’s Erik Woodring argue that a polished AI platform could accelerate iPhone upgrades and lift services revenue, potentially pushing shares to $440—over 40% above Friday’s close. Woodring described the conference as a pivotal moment to reposition Apple as an ‘AI winner,’ noting that such a label often drives fundamental and valuation inflections for tech stocks. Meanwhile, JPMorgan Chase’s Samik Chatterjee expects Apple’s AI execution, combined with product redesigns later this year, to sustain stock outperformance through mid-September. Skepticism lingers, however. UBS analyst David Vogt doubts the AI features will meaningfully boost iPhone demand, while Harding Loevner’s Kyle Levins cautions that Apple’s valuation—currently at 33 times estimated earnings—remains stretched despite steady growth. Levins noted that while Apple’s revenue growth is projected to hit nearly 15% this year, it is expected to decelerate to 8.6% by fiscal 2027, raising questions about long-term sustainability. Apple’s stock has defied broader tech selloffs, climbing 15% this year and delivering four consecutive years of gains, partly due to its defensive characteristics like strong cash flows. However, the absence of a clear AI strategy has kept it from fully participating in the AI-driven market rally. If WWDC delivers a compelling AI vision, it could finally bridge that gap and justify its premium valuation. Failure to impress, though, could leave the stock vulnerable amid high expectations.