Wedbush analyst Dan Ives is one of the most prominent Apple (AAPL 0.37%) stock bulls on Wall Street. He has often cited the company's annual iPhone upgrade cycle as a reason to invest in Apple stock. He regularly raises his price target for Apple and currently has one of the most optimistic projections on the Street, with a $400 price target.
But Apple's recent Worldwide Developers Conference (WWDC) failed to give the stock a boost. The annual event is often where Apple showcases its latest products or long-awaited upgrades, and this year the company used WWDC to introduce a more advanced version of its digital personal assistant, Siri. The new Siri will incorporate artificial intelligence (AI) to answer questions about content on users' screens, search across apps, and get real-time information from websites. It is Apple's attempt to get back into the AI fray after losing precious ground to Amazon, Alphabet, OpenAI, Anthropic, and others.
However, Apple's stock price fell more than 5% the week of WWDC, and has been treading water for the last month.
Image source: Apple.
Was Ives right in his assessment of Apple?
The problem for Apple right now is that Siri AI isn't a history-defining revolution for Apple -- a high bar, to be sure, but one we've gotten used to Apple clearing. After all, this is the company that revolutionized the smartphone with its touchscreen interface, simplifying text messaging and making the internet more accessible. Apple's other innovations include its Apple Watch, the iPad, iPod, and its vaunted App Store.
However, some of Apple's WWDC announcements aren't live yet. Remember that OpenAI, the company behind ChatGPT, didn't become popular until people started using it themselves back in late 2022. Siri AI isn't being rolled out until this fall, so the impact of the announcement isn't as pronounced as it was for OpenAI and its primary backer at the time, Microsoft.
But there was plenty of support from analysts. Max Weinbach, a consumer technology analyst at Creative Strategies, said the rollout could cut into market share for ChatGPT and Google's Gemini.
"If the new Siri and AI features are good, and Apple can provide them for free with every new Apple device, everyone should be terrified of what happens to the AI companies," Weinbach said on a social media post. In a follow-up post, he wrote: "Siri AI is basically what most consumers use ChatGPT and Gemini for. RIP consumer ambitions for AI companies."
NASDAQ: AAPL
Key Data Points
Gene Munster at Deepwater Asset Management wrote on a social media post that the upgrades looked promising. "Keep in mind, it's still a demo; they overpromised with demos two years ago," Munster wrote. "That said, if they deliver what they showed today, it will drive hardware sales."
Ives wrote in a note that Apple was delivering on what it promised two years ago with a "robust AI strategy and the announcement of Siri AI."
"Overall, this was an impressive event that did not disappoint as [CEO Tim] Cook and Apple finally unveiled an AI strategy that will unleash the true monetization opportunity for AI in the Cupertino consumer ecosystem after a few years of promise ... now it's finally here," he wrote.
Ives has predicted that 20% of the global population will one day access AI through Apple devices, and that AI could add $75 to $100 per share to Apple's stock price.
Given that Apple trades close to $300 per share today, a gain of $100 would put the stock near Ives' price target. But Apple will need to deliver on the promises that it made at WWDC for Ives' prediction to come true.
