Finance News on October 8th (Editor Huang Junzhi): Apple Inc.'s stock price fell 2.25% on Monday. Analysts from the well-known American investment bank Jefferies Financial stated that investors have overly optimistic expectations for the latest iPhone from the company. iPhone 16 is the company's first phone equipped with artificial intelligence (AI) tools.

Analyst Edison Lee at Jefferies Financial wrote in a recent report: "It is too early to have high expectations for iPhone 16/17, due to a lack of substantial new features, limited coverage of artificial intelligence, meaning that high market expectations (5%-10% sales growth) are unlikely to be realized."

Lee has downgraded Apple's rating from "buy" to "hold" and set a target price of $205.

Apple's stock price has rebounded about 34% from its low point in April, with most of the increase reflecting optimistic sentiment that artificial intelligence features will drive consumer phone upgrades and accelerate profit growth. However, early signs indicate mixed market demand.

Lee stated that he recognizes the long-term potential of artificial intelligence, believing that Apple is the "only company able to provide low-cost, personalized AI services using proprietary data as a software and hardware integrated enterprise." However, he mentioned that the current valuation is "very high," and artificial intelligence will not be a driving force in the short term.

"Smartphone hardware needs to be redesigned to truly implement artificial intelligence, which may not happen until 2026 or 2027," he added.

Overall, while Wall Street analysts are optimistic about Apple, they do not believe that the iPhone 16 can immediately rescue the stock price or significantly boost demand. Only 65% of analysts recommend buying the stock, while Microsoft, Nvidia, and Amazon have recommendation percentages close to or exceeding 90%.

Jefferies Financial is not the only one bearish on the iPhone 16, Barclays also sounded the alarm in a report earlier this month. Barclays analysts led by Tim Long and George Wang revealed that they have completed an investigation into the iPhone supply chain and found that due to lower-than-expected demand, Apple may have cut iPhone 16 production for the fourth quarter, leading to significant reductions in orders for key components.

The report stated that an investigation into the supply chain revealed that a top supplier from Taiwan, China may have been significantly cut by Apple, "We believe Apple may have just reduced the production of key semiconductor components for the iPhone by about 3 million units (until the end of December this quarter)."

Barclays analysts explained in the report that if the investigation is correct and Apple's related order reductions are confirmed, this will be the earliest order cut in the latest mobile sales cycle, as Apple usually makes its first order adjustments at the beginning or middle of October.

In addition, the report mentions an indicator used to measure demand — the delivery time of new iPhone models is getting shorter, and it is believed that they indicate weak consumer demand.