Apple(US:AAPL)2025-05-26 13:25Investment Rating - The investment rating for Apple, Inc. is "Buy" with a target price of $240, representing an expected return of 19.2% from the current price of $201.36 [2][4]. Core Insights - The report highlights potential impacts of proposed tariffs by President Trump, estimating a 130 basis points incremental gross margin impact and a 4% incremental EPS impact in FY26 if a 25% tariff is imposed on iPhones not made in the US [1]. - The valuation of Apple is based on a P/E ratio of 28x on the FY2027 EPS estimate, which is an 8% premium to its historical level, justified by expanding gross margins, a growing services sales mix, and strong balance sheet [4]. Summary by Sections - Tariff Impact Analysis: The report discusses a bear case scenario where a 25% tariff on iPhones could significantly affect Apple's gross margins and earnings per share [1]. - Valuation Methodology: The target price of $240 is derived from a P/E ratio of 28x, reflecting a premium due to various growth factors [4]. - Market Capitalization: Apple's market capitalization is reported at approximately $3,007.5 billion [2].