Apple stock price forecast ahead of the annual WWDC event

By: Crispus Nyaga
Crispus Nyaga
Crispus is an active trader, where he is followed and copied at Capital.com. He lives in Nairobi with his wife, son,… read more.
on Jun 7, 2021
  • The Apple stock price fell in premarket trading on Monday.
  • The stock will react to the second virtual WWDC event.
  • The four-hour chart shows that the stock could see some weakness in the near term.

The Apple (NASDAQ: AAPL) stock price is down by 0.50% as investors wait for the Worldwide Developers Conference (WWDC) later on Monday. The stock is trading at $125.25, which is slightly below last Friday’s close of $125.89. 

Apple stock price
Apple stock price action

Apple stock has struggled

The Apple stock has struggled in the past few months as investors worry about the company’s growth. The company’s stock has dropped by more than 13% from its highest level this year. That has brought its total market capitalisation to more than $2.15 billion. 

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This performance is partly because many investors expect some of the company’s service businesses to start slowing down as people go back to work. Some of the businesses that are expected to see some weakness are Apple Arcade and Apple TV+. 

However, some analysts believe that the slowdown will be offset by the strong hardware. The segment is expected to grow as people allocate some of their saved funds to iPhones, Macbooks, and the relatively new iMacs. The recent iMacs powered with the M1 chips have received relatively strong reviews.

In total, analysts expect that Apple’s revenue will drop from more than $82 billion in the first quarter to $72.9 billion in the second quarter. They also expect that its annual revenue will increase to more than $354 billion from the previous $274 billion.

WWDC ahead

The next big catalyst for the Apple stock price will be the Worldwide Developers Conference (WWDC) that will start on Monday. This will be the second consecutive year that the closely-watched conference will take place virtually. 

The company is expected to talk about the next update to iOS, WatchOS, iPadOS, and its TVOS. Other things the management and the company’s leaders will talk about are the next version of its M1 chip. Ratings of the first version have been relatively positive, with many reviewers citing the chip’s battery performance.

In the past, Apple stock has not made major moves during the annual WWDC event. Indeed, an analyst at Morgan Stanley wrote:

“While we expect the majority of software/operating system upgrades to be more evolutionary than last year, we do believe Apple will highlight efforts to broaden the use of in-house designed silicon, and potentially launch a new MacBook with the Apple silicon, making this year’s WWDC a potentially more significant catalyst than years past.”

Most analysts are optimistic about the AAPL stock price. Those at Fundamental Research expect that the shares will rise to $144 while those at UBS and Barclays expect that the stock will rise to $155 and $135, respectively. However, those at New Street Research expect the shares to drop to $90.

Apple stock price analysis

Apple stock price
Apple stock price chart

The four-hour chart shows that the Apple stock price is not looking good for bullish investors. The stock has formed a head and shoulders pattern. This is usually a bearish reversal indicator. The price also remains slightly below the 25-day and 50-day exponential moving averages (EMA). 

Therefore, there is a possibility that the shares will keep falling ahead of the company’s next earnings. This price action will be confirmed if the price manages to move below the neckline at $115.

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