Apple expected to deliver strong 12‑month performance, says

Apple could trade at a low‑30s forward earnings multiple, according to Deepwater managing partner Gene Munster, who also forecasts two more bullish years for AI investments despite recent market volatility【2】. Munster’s view suggests Apple’s growth outlook may be undervalued relative to current market pricing, a point that could influence analysts and investors tracking the tech giant’s earnings trajectory.

Apple’s valuation versus peers

Munster argues that Apple’s current price reflects a premium multiple that “should be in the low 30s for its forward earnings,” implying that market forecasts for iPhone and services growth are too conservative. By contrast, many large‑cap tech stocks are priced at forward multiples ranging from the high‑20s to low‑40s, positioning Apple near the upper end of that band. This valuation gap, if narrowed, could provide upside for the stock as earnings expectations catch up with reality.

AI market backdrop and Nvidia expectations

While Apple’s valuation is a focal point, Munster also highlighted the broader AI landscape, predicting “two more bullish years” before any potential market correction. He noted that Nvidia’s revenue growth forecasts are slated to fall from an 80% surge to around 20% in coming years, yet he believes these projections may be conservative given the accelerating demand for computational power articulated by Nvidia’s CEO Jensen Huang【2】. The implied slowdown in Nvidia’s growth rate serves as a benchmark for the AI sector’s maturation, reinforcing Munster’s view that the underlying fundamentals remain robust.

Implications for the tech sector

Munster’s dual commentary ties Apple’s prospective earnings strength to the sustained momentum in AI. If Apple can leverage AI capabilities to boost services and hardware, the company may justify a forward P/E in the low‑30s, aligning it more closely with peers that are already benefiting from AI‑driven growth. Conversely, a broader market correction in AI could temper expectations, making Apple’s premium valuation more vulnerable.

What to watch

• Apple’s upcoming earnings release (date not specified) for evidence of earnings acceleration that could support a low‑30s forward P/E.
• Nvidia’s quarterly revenue reports to see whether growth rates exceed the projected ~20% decline.
• Any major AI product announcements from Apple that could shift market sentiment on its growth prospects.

Munster’s outlook underscores a potential disconnect between Apple’s current premium valuation and its underlying earnings trajectory, while also framing the next two years as a critical window for AI‑driven growth across the sector. The key question remains whether Apple can translate AI advancements into tangible earnings uplift before broader market dynamics shift.