Apple stock: Is it a buy ahead of the iPhone 16 launch event?

Apple (AAPL) shares were largely in a holding pattern ahead of the company's product launch event this fall, but many investors are probably wondering: Is AAPL stock a buy right now?

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The consumer electronics giant will hold its launch event on September 9 at its headquarters in Cupertino, California. Apple is widely expected to unveil its iPhone 16 line of smartphones, as well as new models of the Apple Watch and AirPods.

Apple shares rose after the company announced a product launch event called “It's Glowtime” on August 26.

The iPhone 16 series will be Apple's 18th generation smartphone family, but it is the first to feature Apple's variant of artificial intelligence, called Apple Intelligence. Apple AI will utilize both on-device and data center processing, with a focus on privacy and security.

At the heart of Apple's AI strategy is a revamped digital assistant called Siri that responds to voice and text input. Thanks to its AI intelligence, Siri can work across applications, pulling information from Messages, Email, Calendar, Photos, and other apps. It can also summarize emails and web pages and transcribe calls. It can also generate custom emojis and other images.

Headwinds for Apple shares

Apple's share price has been hit by several news stories recently.

On August 3, Warren Buffett’s Berkshire-Hathaway (BRKB) announced a massive sale of its Apple shares.

Berkshire Hathaway reduced its stake in Apple by 49% in the second quarter. However, Apple remains a top holding, with the conglomerate owning $84.2 billion worth of Apple stock as of June 30.

On August 5, a federal judge ruled that alphabet (GOOGL) subsidiary Google violated antitrust laws by using unfair business tactics to dominate the Internet search advertising market. A central point of the Justice Department's indictment against Google was the company's annual payments of $20 billion to Apple to make Google the default search engine on iPhones.

These payments to Apple are now at risk as the case moves into the remedy phase.

On August 26, Apple announced that its respected CFO was leaving his post after more than ten years.

Chief Financial Officer Luca Maestri will step down from his position effective January 1. He will continue to lead Apple's corporate services teams, including information systems and technology, information security, and real estate and development.

As part of the planned succession, Kevan Parekh, Apple's vice president of financial planning and analysis, will become chief financial officer and a member of the executive committee.

Apple Basics

Late on August 1, Apple beat expectations for the third quarter thanks to record services revenue and strong iPad sales. Apple also slightly beat expectations for the current quarter. In the next trading session, Apple shares rose 0.7 percent to close at 219.86.

Apple earned $1.40 per share on revenue of $85.8 billion in the quarter ended June 29. Analysts surveyed by FactSet had expected earnings of $1.34 per share on revenue of $84.4 billion. Year-over-year, Apple's earnings rose 11 percent while revenue rose 5 percent.

In the June quarter, Apple's hardware sales rose 2% year over year to $61.6 billion, while services revenue increased 14% to $24.2 billion.

Apple's iPhone revenue fell nearly 1% to $39.3 billion, accounting for 46% of the company's total revenue in the fiscal third quarter.

Meanwhile, sales of Apple's iPad tablet rose 24% to $7.2 billion thanks to the launch of new models. Sales of Mac computers rose 2% to $7 billion.

Finally, revenue from Apple's wearables, home devices and accessories division fell 2% to $8.1 billion.

Apple forecast fourth-quarter revenue growth of about 5%, while the consensus estimate was 4.4%.

Technical analysis of AAPL stock

According to IBD Stock Checkup, Apple stock has an IBD Composite Rating of 91 out of 99. IBD's Composite Rating combines five separate proprietary ratings of fundamental and technical performance into one easy-to-use score. The best growth stocks have a Composite Rating of 90 or better.

AAPL stock has an IBD Relative Strength Rating of 86 out of 99. The Relative Strength Rating shows how a stock's price performance has compared to all other stocks over the past 52 weeks.

Is Apple stock currently a buy?

No, Apple stock is not a buy right now. But it could be soon.

According to IBD analysis, Apple shares are approaching a 232.92 buy point from a handle formation. This buy point is within an eight-week consolidation pattern that has a 237.23 buy point, according to IBD MarketSurge charts. This secondary buy point is also Apple's all-time high, reached on July 15.

Apple shares closed regular trading on September 6 at 220.82.

Keep an eye on the overall stock market. If the market is heading south, don't try to fight the overall stock market direction.

To find the best stocks to buy and watch, visit IBD's Stock Lists page. For more stock ideas, visit IBD's Leaderboard, MarketSurge and SwingTrader platforms.

Follow Patrick Seitz on X, formerly Twitter, at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.

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