On November 8th, Apple's CEO John Ternus recently referred to Apple as "the best company in the world," but Bernstein believes that whether Apple is also the most worthwhile stock to invest in still depends on investors' judgment of the business prospects of AI and its current valuation. The firm has raised its target price for Apple from $370 to $380, maintaining a "outperform the market" rating, which represents a potential upside of about 12% compared to the closing price of $338.32 on November 2nd. Bernstein believes that for investors who wish to reduce their exposure to infrastructure investment risks associated with AI, Apple remains an attractive technology stock option.

Bernstein pointed out that Apple has over 2.5 billion active devices, and its vast user base provides a significant advantage for the commercialization of future AI services. However, it may take longer for the related revenues to be converted into actual profits. Apple's latest financial report shows that in the fourth quarter of fiscal year 2026, revenue increased by 12% year-on-year to $114.5 billion, and earnings per share diluted increased by 14% year-on-year to $2.10, both exceeding market expectations. Among them, iPhone business revenue increased by 17% year-on-year to $57.6 billion, and Mac sales grew by 24%. The company expects revenue in the December quarter to increase by 7% year-on-year to $10 billion, which is higher than market expectations.

However, Bernstein believes that rising costs and high valuations still limit the potential for further increases in Apple's stock price. Affected by the increase in storage chip prices, Apple expects its gross margin for the December quarter to be between 45% and 46%, which is lower than market expectations. Additionally, the slowdown in growth in its App Store and licensing businesses also puts pressure on the prospects for service revenue. As a result, the firm has lowered its earnings per share forecast for Apple's fiscal year 2027 from $9.90 to $9.78, and for fiscal year 2028 from $11.26 to $11.13.

In terms of valuation, Apple's current expected price-earnings ratio is around 35.1 times, which is significantly higher than the historical average of 22.7 times since 2016. Bernstein believes that if hardware costs continue to rise, or if the commercialization progress of AI business is slower than expected, Apple's current high valuation will make its stock price more vulnerable to downward adjustments in profit forecasts.