Investing

I've Owned Apple's Stock for 9 Years, But These 3 Factors Have Me Considering Selling

Joey Frenette

Published: January 14, 2025 8:49 am

Apple (NASDAQ:AAPL) shares have been a major winner over the past decade. And while I’ve resisted the temptation to sell as negative headlines flowed in, primarily regarding weaker iPhone sales, I do think the stakes are getting higher in 2025. Undoubtedly, Apple shares have been clobbered in recent weeks, now down nearly 10% from an all-time high just shy of $260 per share.

As one of the less-loved members of the Magnificent Seven, especially since the new year began (the stock is down a whopping 5.8% year to date), investors hanging onto the stock must ask themselves if it still makes sense to be net buyers of the latest dip, or if it makes sense to de-risk and rotate into a name that’s less at risk to a mass dumping of index funds.

Though I have no plans to sell yet, I am getting just a tad more concerned over the following factors. As the list of worries mounts, I may very well consider trimming into the back half of the year. However, as a long-term investor, I’ll only hit that sell button if the long-term narrative has deteriorated rather than just a few near-term hiccups (think missed earnings or a quarter of weaker iPhone sales) that tend to be transitory in nature.

Indeed, it can be painful to be an AAPL shareholder over the near term. Over the long haul, however, the wild ride tends to be well worthwhile since shares tend to surge at moments when we least expect it, likely on the back of rumors and analyst reports.

Without further ado, here are three things to watch out for in 2025 as Apple stock attempts to recover from a nasty start to the year.

The stock’s gotten quite expensive.

In my nine years or so in the stock, shares have never been as expensive as they’ve been in recent months. Though Apple shares have become a bit more palatable after recently correcting, they’re still not nearly as cheap as they were back in 2016, when I first punched my ticket to the name. At writing, AAPL stock goes for 38.5 times trailing price-to-earnings (P/E), or just north of 31 times forward P/E — both of which are hefty by Apple standards.

Indeed, the S&P 500 as a whole has gotten pricier, so it should be no surprise to see its top holding trading at a premium to historical averages. And while some bit of premium may be warranted given Apple’s artificial intelligence (AI) expertise, many folks out there view Apple as behind in the race. When this will change, though, remains the $4 trillion question.

With Warren Buffett’s Berkshire Hathaway (NYSE:BRK-B) offloading a massive amount of shares, perhaps it’s not too far-fetched to consider exiting half a position with the intention of buying back at lower prices. Given the latest pullback and still-stretched multiple, the odds of lower lows over the near term seem pretty high. Whether it’s the lofty P/E multiple or something else (his firm’s tax situation) that has Buffett selling Apple remains a mystery. Either way, it doesn’t help support the bull case for AAPL.

Apple Intelligence is off to a slow start.

Apple Intelligence hasn’t really been the game-changer I’ve been expecting. Though Genmoji, Image Playgrounds, ChatGPT integration, and writing tools are nice to have, I, and likely many other Apple users, are wondering when some of the more profound AI features will be arriving. In 2025, years after the masses experimented with Dall-E, AI image generation is nothing new and exciting anymore. 

What I’d like to see from Apple are unique features that set it apart from the pack. We may not have to wait too long for such features to come in. Reportedly, iOS 18.4, which is slated for an April 2025 release, will see further Siri upgrades, including on-screen awareness, extended app integration, improved personal context, and even better voice processing. These intriguing features offer a more personalized touch and could help put Siri and Apple Intelligence ahead of rivals.

If you view Apple Intelligence as more of a dynamic work in progress (which it is), it’s easier to pay up today’s hefty multiple.

iPhone growth has gotten sluggish

Perhaps the biggest yellow flag to sell is the slowing iPhone growth. According to Counterpoint Research, the company’s global smartphone sales dipped 2% last year in a year that saw the market grow 4%. That’s a concerning trend, to say the least. Combined with recent analyst downgrades and uncertainties tied to the Chinese market (could tariffs weigh heavily?), it’s easy to throw in the towel on Apple stock this January.

That said, I think those who sell on cooling sales news could run the risk of missing out on a bounce back in 2025, especially if the so-called AI-driven supercycle comes to light.

In any case, I’ll be keeping close tabs on iPhone sales this year as new Apple Intelligence features continue to roll out. Come WWDC 2025 (likely coming this summer), it’s up to Tim Cook and company to convince holders of old devices that it’s time to upgrade to the latest and greatest.