As the highly anticipated Apple iPhone 16 launch approaches on September 9, excitement continues to build among consumers and investors alike. Apple Inc. (NASDAQ:AAPL) has teased its latest device as featuring advanced “Apple Intelligence,” raising hopes for a groundbreaking product. However, recent history has shown that big product launches like this can lead to a “sell the news” event, prompting the question: Is AAPL stock a buy or sell ahead of the iPhone 16 launch?
Apple’s Stock History in September: A Cautionary Tale
September has not been a kind month for Apple’s stock in the past. Despite the hype surrounding new iPhone releases, the Apple iPhone 16 launch comes during a historically weak period for the company’s stock performance. Over the past decade, AAPL shares have dropped an average of 3.5% in September. The trend is even more pronounced over the last four years, with the stock falling more than 6% annually, including an 8.9% decline in 2022.
While September tends to be a tough month for U.S. equities in general, Morgan Stanley analyst Erik Woodring has pointed out that Apple’s stock often underperforms the market on the day of an iPhone launch. This track record has led some to believe that the Apple iPhone 16 launch may also result in a “sell the news” scenario, similar to what happened with Nvidia’s (NASDAQ:NVDA) earnings report in August.
Nvidia’s Example: A “Sell the News” Event?
AAPL investors may recall the recent situation with Nvidia, another tech giant whose stock experienced a significant selloff despite delivering stellar fiscal Q2 2025 earnings. Nvidia exceeded expectations on both revenue and profit, yet its stock fell because the market had already priced in high expectations, leaving little room for further upside. NVDA shares had run up substantially ahead of the report, resulting in a classic “sell the news” scenario.
Similarly, the Apple iPhone 16 launch has been generating excitement for months, especially since Apple’s Worldwide Developers Conference (WWDC) in June, where the company unveiled several AI initiatives. While the initial reception was lukewarm, Apple’s stock has since rallied, outperforming the broader S&P 500 Index.
Apple’s Recent Stock Surge: Built on Optimism?
Since the WWDC event, Apple stock has posted double-digit gains, largely fueled by optimism over the iPhone 16 and its potential to trigger a massive replacement cycle, similar to the 5G upgrade cycle of recent years. With AI-fueled features expected in the new iPhone, investors are hoping for a robust sales boost that could keep Apple’s stock on its upward trajectory.
Despite this optimism, some market observers believe the recent rally may have been overdone. Apple is currently trading at a forward price-to-earnings ratio of over 30x, leaving the stock vulnerable to any disappointments. Should the iPhone 16 fail to meet lofty expectations, AAPL shares could experience a sharp pullback.
Analysts Weigh In: Buy or Sell Ahead of the iPhone 16 Launch?
Analysts have mixed views on the Apple iPhone 16 launch and its impact on AAPL stock. On one hand, Morgan Stanley remains bullish, naming Apple as a top pick and predicting that its year-end performance will outperform historical trends. Citi has even named Apple ahead of Nvidia as its top AI stock for 2025.
On the other hand, UBS has a more cautious stance, reiterating its “neutral” rating on Apple due to perceived risks ahead of the launch. While demand for the iPhone 16 could be strong, analysts note that the market has already priced in significant optimism, increasing the margin for error. Of the 31 analysts covering Apple, 18 rate the stock as a “Strong Buy,” while 8 recommend holding.
Potential Risks: China and U.S.-China Relations
One wildcard in the Apple iPhone 16 launch is Apple’s performance in China, a key market where the company faces increasing competition from domestic rivals like Huawei. As U.S.-China trade tensions escalate, Apple could face challenges in maintaining its market share in the region. Huawei is reportedly planning a product launch shortly after Apple’s event, further intensifying competition in the Chinese market.
Conclusion: Should You Buy or Sell?
The Apple iPhone 16 launch will be a pivotal moment for Apple and the broader tech sector. While some analysts expect a continued rally in AAPL shares, others warn that the stock may have already priced in too much optimism. If the iPhone 16 fails to impress, especially in terms of sales, AAPL stock could see a significant pullback. Investors should carefully weigh the risks and rewards before deciding whether to buy or sell ahead of the event.
Ultimately, whether the Apple iPhone 16 launch will be a “sell the news” event, like Nvidia’s earnings, remains to be seen, but the stakes are undeniably high for Apple and its investors.
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