After the US stock market closes on August 3rd,xrp ,000 to ,000 Apple will release its financial report for the third quarter of the 2023 fiscal year. Market expectations suggest that Apple's Q2 revenue will be approximately $81.583 billion, with adjusted net profit of $18.819 billion and earnings per share of $1.203. We anticipate that this financial report will meet expectations, but due to the relatively high valuation, we expect limited upside potential for the stock price.

After the US stock market closes on August 3rd, Apple will release its financial report for the third quarter of the 2023 fiscal year (April-June). According to Bloomberg analysts' consensus expectations, Apple's Q2 revenue is estimated to be approximately $81.583 billion, showing a decline both sequentially and year-on-year. Adjusted net profit is estimated at $18.819 billion, with earnings per share of $1.203.

The projected decline in revenue is mainly attributed to the smartphone industry's downturn. According to IDC data, global smartphone shipments in Q2 2023 decreased by 7.8% compared to the same period last year, with iPhone shipments in Q2 2023 totaling 42.5 million units, down 6.3% year-on-year.

【Source：IDC】

iPhone sales have always been Apple's largest source of revenue. In the previous quarter, iPhone sales accounted for 54% of total revenue. The decline in iPhone shipments will undoubtedly affect the company's revenue.

The market is pinning its hopes on the company's services business to offset the impact of declining phone revenue. Apple services are the second largest contributor to Apple's revenue, accounting for 22%. Analysts predict that Apple's service revenue in this financial report will be $21.8 billion, an 11% year-on-year growth.

The guidance for the third quarter is undoubtedly a key focus of this financial report. Apple is expected to release the iPhone 15 in the fall, which could improve revenue expectations for the next quarter. However, there are reports suggesting a possible delay in the launch of the iPhone 15, and if true, it could impact the performance guidance for the third quarter.

Before the release of the financial report, major Wall Street banks have raised their target prices. Wells Fargo Bank has raised Apple's target price to $225, as the bank believes that Apple's services business will accelerate growth in the second half of 2023. Deutsche Bank has raised the target price to $210, believing that with the release of new iPhones, there is potential for year-on-year growth in Apple's smartphone sales in 2023.

Here are the target prices from various banks that we have compiled for everyone:

【Table: Compiled by Mitrae】

Overall, the market is relatively optimistic about Apple's future performance. However, we cannot overlook its risks.

Apple's stock price has reached a historic high this year, with a market capitalization of 3.1 trillion US dollars. Currently, Apple's price-to-earnings (PE) ratio is 33 times, which, based on estimated earnings per share (EPS), makes it difficult to sustain the current overvaluation.

【source: TradingView, Apple stock price and PE trend chart】

The analyst's forecast for Apple's financial report is relatively conservative, and we estimate that the report will meet or slightly exceed expectations. However, due to the stock price being at a relatively high level, we expect the extent of the positive impact to be limited.

Additionally, as Apple is the largest component of the Nasdaq 100 Index (with a weight of 12%), this Apple financial report will have a significant but manageable impact on the Nasdaq 100. Please take note of this.

From a technical perspective, the moving averages indicate that Apple's stock price is still in an upward trend, but some oscillation indicators show sell signals, so investors should exercise caution. In the short term, the support level is around 192, while the resistance level is around 198. Looking at the medium to long term, Apple still has upward momentum, with a target price of 201.

【Source：TradingView】