Short Apple’s Stock

By Douglas A. McIntyre Published Jan 21, 8:30AM EST

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Short Apple’s Stock — © bombuscreative / iStock Unreleased via Getty Images

Very few investors are short Apple’s (NASDAQ: AAPL) shares. Short interest is less than 1% of the float. However, if there was ever a time recently to short Apple’s shares, it is now. Apple’s revenue may no longer grow, and its flagship iPhone 15 sales appear to be in trouble.

Apple has had a remarkable run. Five years ago,+ shares traded at $38. Today, that figure is $191. However, in the last two months, the shares are flat.

Barclay’s recently issued a rating downgrade of Apple from “neutral” to “sell.” Worry about iPhone sales was at the heart of their argument. Piper Sandler cut the stock from “overweight” to “neutral.” Its analyst was that iPhone sales in China, the world’s largest smartphone market, were falling.

A look at Apple’s last quarter shows that problems had already started. In the next two weeks, Apple will report numbers again. At the core of any critique is whether iPhone revenue is falling and revenue at its “Services” business is still rising.

In the most recent quarter, revenue fell 1% to $89.5 billion. iPhone revenue numbers were mediocre. At $43.9 billion, they rose from $42.7 billion in the year-ago period. The bright spot was “Services,” which included Apple Pay and Apple TV+ items. This revenue was $22.3 billion, up from $19.2 billion. “Services” would need to rise at a breakneck pace to offset any sharp drop in iPhone revenue.

The iPhone faces two challenges. The first is that people may be less likely to upgrade to a smartphone, the improvements of which are only modest from model to model. How many people can tell that a camera has been improved slightly or that a chip’s speed is better?

The other challenge is the Android operating system, which several smartphone companies use and is led by behemoth Samsung. Globally, Android’s share is 70%. Android competes directly with Apple’s iOS. However, Apple is the world’s largest smartphone company.

When Apple’s numbers stumbled in late 2022, the stock traded down to $130. That could happen again if the next two or three quarters do not recover nicely from the most recently reported one.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.