Want to make money in the stock market? Jim Cramer, the well-known CNBC host, is making a bold claim: Apple (AAPL) is the place to be. But why is he so confident, especially when the stock has faced some recent headwinds? Let's dive into his reasoning and the factors influencing Apple's performance.
We recently highlighted Apple Inc. (NASDAQ:AAPL) in our list of 10 Stocks Jim Cramer Talked About. And it's no surprise, given the flurry of activity surrounding the tech giant.
Apple has been a major topic of discussion, particularly following its announcement that it plans to integrate Google's Gemini AI model into a future version of Siri. Cramer sees this move as a vindication of his earlier predictions, made when Apple's stock was struggling at the beginning of 2026. But here's where it gets controversial... While Cramer is bullish, not everyone agrees. Analysts are offering mixed opinions on Apple's future, creating a fascinating tug-of-war between optimism and caution.
For example, Bank of America has reiterated a "Buy" rating with a price target of $325 per share. Their rationale? They believe strong growth in Apple's services sector and continued robust demand for the iPhone will lead to positive surprises in the upcoming earnings report. This is great news, but it's not the whole story.
On the other hand, Keybanc maintains a "Sector Weight" rating. And this is the part most people miss... Their data suggests that spending related to Apple products has fallen below the three-year average, indicating potential weakness. So, who's right? The answer likely lies in a nuanced understanding of several key factors, including Apple's deal with Google, the insights from Apple's SVP of Services, Eddie Cue, and the overall market sentiment surrounding the stock.
Cramer addressed these issues directly, saying:
"Well look it’s nutty to try to figure out the impact away from that. But, you know, Carl you can sit there and you can think, who can’t be regulated by the government directly. Maybe they have a better shot. Would the President say, you know what I don’t like how much Apple is charging for services? They made too much money. Which is something we’re going to hear this morning, Apple just announced that service business is terrific, something which by the way is exactly the opposite of what Wall Street is saying."
He continued, emphasizing the disconnect between market perception and reality:
"And by the way Carl, we’re not even talking about Apple having better than expected service revenue. Apple’s been down, down, down since the year began because people think the service revenue is going to be disappointing. That’s clearly wrong, we’ve got a statement on the tape today saying it’s actually pretty good, so let’s keep that in mind."
Cramer points out that negative sentiment has plagued Apple since the start of the year, driven by fears of declining service revenue. However, his conversation with Eddie Cue paints a completely different picture:
"You know Apple’s been a big dissapointer since the year began and the reason is frankly people felt that services were coming down, that literally the numbers would be too high for Apple because of that. I spoke to Eddie Cue, obviously very important number two at Apple, and it’s just the opposite. Services are incredibly strong, much stronger than people expect. All the people who thought that that was not the case are dead wrong. I think the numbers will come up, they can’t do that yet. And. Eddie also told me, look, Gemini’s the winner. It looks like Apple foundation model is going to be built on Gemini, there are a lot of people who felt that who is, maybe their going to do a fair look, they did, they did a fair look and they decided, Google is the best. So it’s really fabulous for Gemini, and I would argue, it is really good for Apple."
Cramer highlights the significance of Apple choosing Google's Gemini AI. This decision, according to Cue, came after a thorough evaluation of available AI models. It's a major win for Google and, in Cramer's view, a strategic advantage for Apple. This also brings up a huge point of contention, is Apple's choice to use Google's Gemini a sign of innovation or a reliance on external technologies?
He concludes with a strong endorsement of Apple's fundamentals:
"Yes, those businesses are all better than expected. Now, services, fantastic gross margins. Apple should be up. The fact that Alphabet’s down is just plain stupid. That’s been a big winner all morning. So I just say those are the two places to go if you wanted to make some money, Eddie Cue, very optimistic, to me it seems the numbers are just plain too low, and the people who’ve been selling it, are dead wrong. You want to own Apple, not trade it, it’s been the right thing to do, it’ll be the right thing to do today.”
Ultimately, Cramer believes Apple's strong service revenue and strategic partnerships, like the one with Google, make it a compelling investment. He advises investors to focus on long-term ownership rather than short-term trading.
Are you convinced by Cramer's argument? Do you think Apple's reliance on Google's AI is a smart move? Or do you believe the concerns about slowing consumer spending are justified? Share your thoughts in the comments below!
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Disclosure: None. This article is originally published at Insider Monkey.
