Diverging Paths: Wall Street’s Apple Optimism Meets Buffett’s Caution

Apple Inc. finds itself at the center of a classic investment dichotomy. A wave of bullish analyst upgrades is colliding with the continued, methodical selling by one of its most famous long-term shareholders. The core debate hinges on whether the upcoming iPhone cycle and the company's artificial intelligence strategy can justify its current market valuation.

In recent days, several prominent financial institutions have raised their price targets for Apple shares, painting a picture of anticipated growth.

• Wedbush (December 8): The firm increased its target to $350, citing an impending "AI-driven consumer revolution" it believes will spur significant demand for new devices and services.
• Citigroup (December 10): Analyst Atif Malik lifted Citi's target from $315 to $330. The bank simultaneously clarified that a separate $350 target circulating in the market originated from Wedbush, not from Citi. Citi's revised outlook is based on three key factors: supply chain data suggesting stronger-than-expected demand for the new iPhone generation; a looming upgrade cycle from users of older models like the iPhone 12 and 13; and the view that "Apple Intelligence" and the Google Gemini partnership represent tangible future revenue streams, not mere hype.
• Evercore ISI (December 8): Its target was raised to $325, with emphasis on Apple's robust services business providing stable, recurring income.
• CLSA (December 5): This analyst group also raised its target to $330, matching Citi's new level.

The common thread among these upgrades is the expectation of a strong fiscal 2026, driven by a broad hardware refresh—particularly in iPhones—that could offset broader economic headwinds.

The Cautious Counterpoint: Berkshire's Continued Exit

Standing in contrast to this analyst enthusiasm is Warren Buffett's Berkshire Hathaway. Recent regulatory filings reveal that the conglomerate sold approximately 42 million Apple shares during the third quarter, trimming its remaining stake by about 15%.

This sale marks a consistent pattern: it is the fourth consecutive quarter in which Berkshire has reduced its Apple position. Concurrently, Berkshire's already substantial cash reserves have continued to grow, signaling a management preference for caution and risk reduction in a higher interest rate environment, possibly over other opportunities.

The contrast is stark: market researchers are highlighting future earnings potential from device upgrades and AI monetization, while a premier long-term investor appears to see limited upside at current valuations and is systematically taking profits.

Should investors sell immediately? Or is it worth buying Apple?

The Macro Overhang: Federal Reserve Policy

Beyond company-specific dynamics, U.S. monetary policy is a significant factor. As traders await the latest interest rate decision from the Federal Reserve, Apple's stock has traded in a narrow range, with investors hesitant to make large directional bets.

Market participants are closely watching whether the Fed, even if it cuts rates, maintains a relatively restrictive outlook for 2026. Such a "hawkish" signal could pressure the valuation premiums of major technology stocks, as future earnings would be discounted more heavily.

This uncertainty acts as a short-term cap on upward momentum, even though the stock remains modestly positive for the year and is well above its 52-week low.

Conclusion: A Battle of Narratives

The investment community is split into two distinct camps. Major investment banks are forecasting a powerful iPhone and AI surge for 2026, backing their view with higher price targets. Meanwhile, Berkshire Hathaway is steadily unwinding its position, prioritizing risk management and capital preservation.

The path forward will likely be determined by two factors: whether the anticipated "supercycle" dynamics for iPhone 17 sales and AI-enabled services materialize in coming quarterly results, as predicted by Citi and Wedbush, and to what degree the Federal Reserve's interest rate and communication policies set the valuation framework for big-tech equities.