Why Apple (AAPL) Is Rising While Nvidia and Other Tech Stocks Fall

While chip stocks were being hammered on Monday, one giant went the other way. Apple (NASDAQ:AAPL) climbed about 2% to a fresh record high, even as Nvidia slipped and memory stocks crashed. It was an unusual split, and it tells you something useful about what investors are worried about right now.

Why Apple Rose

The immediate spark came from Citi. The bank raised its price target on Apple to US$365 from US$315, keeping its Buy rating. That implies about 16% upside from where the stock trades today.

Citi’s reasoning is simple. Even though phone and computer sales are slowing worldwide, Apple keeps taking market share from rivals. It also has something most companies lack: the ability to raise prices without losing customers. Citi expects Apple to nudge prices higher with the iPhone 18 launch in September, which it called an important catalyst, and a first foldable iPhone is expected later this year.

Why Apple Holds Up When Chips Fall

Here is the bigger picture, and it is the part worth understanding.

Chip stocks like Nvidia and Micron depend on one thing: companies spending enormous sums on AI. When investors get nervous that this spending might slow, or that rising oil prices could force interest rates up, those stocks fall hard.

Apple is different. It sells phones, laptops and services to hundreds of millions of loyal customers. Its profits do not hinge on whether tech giants keep building AI data centres. So when fear grips the market, money often rotates out of speculative chip names and into steady, cash-rich businesses like Apple. In our view, that is exactly what happened on Monday: Apple was the safe harbour.

The Irony Nobody Mentions

Here is a twist most coverage misses. The very memory boom that is making chipmakers rich is hurting Apple.

Apple has to buy memory chips for its devices, and prices for them have soared thanks to the AI memory frenzy. Apple’s leadership has described the shortage as a “hundred-year flood”. The company recently pledged US$1.5 billion to a Broadcom plant in Colorado just to lock in chip supply. In other words, Apple is fighting a cost problem created by the same AI boom that lifts Nvidia.

That is why the price rises matter so much. Apple is planning to charge customers more to protect its profits.

The Investor’s Takeaway

So is Apple a buy? Our take is more cautious than Citi’s, and here is why.

Look past the headline target. Citi’s US$365 is an outlier. The average analyst target is about US$327, only around 4% above today’s price. In plain English, most of Wall Street thinks Apple is already close to fully valued after a 16% gain this year and a 49% run over twelve months.

The stock also trades at about 38 times earnings, expensive for a company whose device sales are growing slowly, and its margins face genuine pressure from those soaring memory costs. Apple is also in a legal fight with OpenAI, which it sued last week for allegedly stealing trade secrets to build a rival device. OpenAI denies the claims, and the case is unlikely to move the stock soon, but it is a reminder that Apple’s grip on premium devices is being challenged.

Our view: Apple is a superb, defensive business, and its strength on a brutal day for tech proves it. But buying at a record high, when the average analyst sees only 4% upside and costs are climbing, is not where the value lies. The smarter move is to wait for the 30 July earnings report, which will show whether Apple can really pass those higher costs on to customers.