Over the past four years, the most underweight megacap stock in institutional portfolios has been Microsoft. Now it’s Apple’s turn.
Apple is now the least-owned FAANG stock by institutional investors and is the most underweighted since 2008, according to Morgan Stanley.
Over the past four years, the most underweight megacap stock in institutional portfolios has been Microsoft, according to analyst Erik Woodring. However, that position was handed over to the iPhone maker by the second quarter of this year.
“Apple’s institutional portfolio active weighting in 2Q fell 26 bps Q/Q to 5.51%,” Woodring wrote in a research note.
Investors are worried that Apple shares are overvalued after the big rally earlier this year. Stocks have grown roughly 40% in 2023 following a broader rally in large-cap technology stocks tied to artificial intelligence.
However, the analyst said there are positives for Apple regarding its recent push in iPhone sales growth and services.
“We see a 5% upside to State Street EPS estimates for the year 2024 and expect the stock to rise as growth accelerates, margins expand and analyst consensus estimates point higher", Woodring added.
On the other hand, Meta is the most popular technology stock in institutional investors’ portfolios and is also the most owned in the last 10 years. According to the analyst: “Among the 5 megacap technology stocks, Meta is the only name where the institutional presence is greater than its S&P 500 weighting”.
Original article published on Money.it Italy 2023-09-03 07:30:00. Original title: Apple, investitori istituzionali in fuga dal titolo. Ecco perché
