Apple NASDAQ:AAPL shares moved lower on Tuesday trading after KeyBanc Capital Markets lowered its rating on the iPhone maker to Underweight from Sector Weight, citing concerns that higher device prices could weigh on future demand.
KeyBanc kept its $250 price target on Apple but said recent increases across several product categories may make consumers more sensitive to pricing. The firm noted that higher costs for iPads, MacBooks and other devices could slow unit sales growth over time.
The brokerage also pointed to changing conditions among wireless carriers, including Verizon Communications NYSE:VZ and AT&T NYSE:T, which may reduce promotional support and device subsidies as handset prices rise. KeyBanc said that trend could lengthen replacement cycles and pressure upgrade activity in Apple's key U.S. market.
Looking ahead, KeyBanc expects Apple's iPhone revenue growth to remain strong in fiscal 2026 before moderating in fiscal 2027. The firm also projected slower expansion in Apple's services business over the same period.