Apple Inc (NASDAQ: AAPL) fans are used to being underpromised and over-delivered. But the company’s chief executive, Tim Cook, did the polar opposite on the AI front.
That’s a big part of the reason why AAPL shares have been taking a hit in recent weeks, according to Sarah Kunst, managing director at Cleo Capital.
Apple phones still lack artificial intelligence to the extend that customers were promised last year and the subsequent weakness in the tech stock made “Tim Cook learn an important lesson, which is, he’s not Elon Musk or Sam Altman.”
Kunst was particularly referring to Musk promising full self-driving for years – something that he is still yet to deliver.
Apple lagging in AI doesn’t matter much
Apple stock price is grappling with significant weakness this month partly because of the broader narrative that the iPhone doesn’t have AI.
However, that narrative isn’t entirely true, said Sarah Kunst, adding “of course Apple has AI, what do you think Siri is,” in her interview with CNBC last week.
Plus, it’s not even entirely fair to expect Apple to go up against the likes of Google on the AI front since the multinational “isn’t really a software company” in the first place.
So, even if it has failed to deliver great AI on schedule, it “isn’t necessarily a big deal,” she added.
Apple will continue to generate strong sales
Sarah Kunst of Cleo Capital remains convinced that AI features won’t stand in the way of iPhone or MacBook sales for now.
That’s because “there’s no real competitor for the most part in the US,” she argued on “Worldwide Exchange.”
Kunst urged investors during the interview to focus instead on AAPL’s progress on chips and the hardware itself since “that’s where they make money.”
Apple stock is currently trading at about $213. A 0.47% dividend yield tied to the Nasdaq-listed firm also makes its shares worth buying at current levels.
What other experts are saying about AAPL
Note that Sarah Kunst isn’t alone in keeping bullish on Apple shares following the recent pullback.
Nancy Tengler of Laffer Tengler Investments also recommends loading up on AAPL on the dip as it has a history of emerging as a lucrative position if bought on weakness.
She quoted examples of the “Apple Maps debacle” and the “earnings warning in January 2019” both of which weighed on the company’s share price rather significantly.
But Apple stock is up 1,100% versus the former and about 550% versus the latter, which suggests “you can step into this name when it disappoints the market,” she concluded.
Others including a senior Wedbush analyst, Dan Ives, also expect AAPL shares to hit a new all-time high as early as the final quarter of 2025.
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