Why Apple stock popped Tuesday morning

Wall Street is bullish on the iPhone-maker's plans for artificial intelligence (AI).

| More on:
Woman relaxing and using her Apple device

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Shares of Apple (NASDAQ: AAPL) were on a tear Tuesday morning, with the stock adding as much as 6.7%. As of 1:53 p.m. ET, the stock was still up 6.2%.

The catalyst that sent the iPhone maker higher was the company's big artificial intelligence (AI) reveal to kick off Apple's Worldwide Developer Conference (WWDC).

The long-awaited announcement

Investors have been waiting since early last year for insight into Apple's plans to join the AI revolution. At the WWDC keynote yesterday, CEO Tim Cook finally detailed the company's plans, and Wall Street's response was extremely bullish.

The biggest revelation was the debut of Apple Intelligence, which will provide on-device generative AI processing across the company's entire product line while also maintaining Apple's famous emphasis on security.

Siri will get a long-awaited AI upgrade and have a greater ability to interact with other iPhone apps. ChatGPT will also be integrated into the iPhone, giving users the option to engage the chatbot for specific topics. Apple also unveiled a host of other AI-powered features that will debut with iOS 18, which will be released this fall.

Wall Street is once again bullish on Apple

Many investors had taken a "wait and see" approach with Apple, worried about waning sales of its flagship iPhone. However, in the wake of the company's presentation, Wall Street has turned decidedly bullish.

Wedbush analyst Dan Ives expressed the prevailing sentiment, suggesting the addition of these new tools to the iPhone will spark "an AI-driven iPhone upgrade cycle starting with iPhone 16." The analyst also suggested AI will add $30 to $40 per share to Apple's growth story.

Even as big tech has staged a significant rally over the past year, Apple's stock has been the outlier, up just 7%, compared to 25% gains for the S&P 500. A laundry list of AI-powered features will likely mark the dawn of the next upgrade cycle, boosting the company's results and putting Apple back in investors' good graces. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Danny Vena has positions in Apple. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Apple. The Motley Fool Australia has recommended Apple. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on International Stock News

A tech worker wearing a mask holds a computer chip.
International Stock News

Prediction: Nvidia will be a top stock to own for the back half of 2025

Several potential catalysts could boost Nvidia's growth in the second half of this year.

Read more »

Modern accountant woman in a light business suit in modern green office with documents and laptop.
International Stock News

Where Will Amazon Stock Be in 3 Years?

Amazon's diversified business model allows it to benefit from many sides of the AI equation.

Read more »

A man leans forward over his phone in his hands with a satisfied smirk on his face although he has just learned something pleasing or received some satisfying news.
International Stock News

If you'd invested $10,000 in Apple stock 20 years ago, here's how much you'd have today

Over the past two decades, shares of Apple have performed exceedingly well as the company produced several tech innovations.

Read more »

Disabled skateboarder woman using mobile phone at the park.
International Stock News

Is Meta's $14.3 billion bet on scale AI too little, too late?

Meta just invested more than $14 billion into data labeling start-up Scale AI, acquiring a 49% equity stake in the…

Read more »

woman watching asx share price on digital screen
International Stock News

Think Nvidia Stock Is Expensive? These 3 Charts Might Change Your Mind.

The chipmaker's shares are cheaper than they appear.

Read more »

A woman sits at her computer with her chin resting on her hand as she contemplates her next potential investment.
International Stock News

Will Amazon be a $5 trillion stock by 2030?

Is the $5 trillion level a dream or an actual possibility? Let's take a look.

Read more »

Man looks up at apple on his head.
International Stock News

3 reasons to buy Apple stock like there's no tomorrow

Apple might be one of the smartest buys in tech.

Read more »

A man looking at his laptop and thinking.
International Stock News

Dan Ives Says Elon Musk Is Dragging Tesla Down. Is It Time to Sell?

The long-time Tesla bull says Musk is risking a $1 trillion opportunity in autonomous vehicles.

Read more »