Apple (AAPL) Falls 2.14% as AI Lawsuit, Rivalry Weighs

Apple shares fell 2.14% to $326.59 on Thursday, giving back some of the recent gains that had pushed the stock near 40 times forward earnings. The decline followed the company's filing of a lawsuit against several former employees, accusing them of stealing trade secrets related to its artificial intelligence work.

The lawsuit adds to the pressure Apple faces in the AI race. Rivals including Microsoft and Alphabet have moved faster to integrate generative AI into their products. Apple has been slower to roll out its own AI features, though it announced plans at its June developer conference.

The stock's Alpha Score of 56 out of 100, labeled "Moderate," reflects a balanced risk-reward. At 40x forward P/E, Apple trades at a premium to its five-year average of 28x, according to FactSet. The Alpha Score incorporates valuation, momentum, and sentiment factors.

Apple reports fiscal third-quarter earnings in late July. The company will need to show progress on AI monetization to sustain the valuation.