Like other big tech giants, Apple (AAPL) faces various legal challenges, including antitrust lawsuits and patent disputes. According to the TipRanks Risk Factors tool, one of AAPL’s main risk categories is Legal and Regulatory, which accounts for 21% of the total 28 risks identified. Moreover, the legal risk exposure is higher than the industry average of 20.3%.
Within the legal and regulatory category, Apple is subject to evolving laws and regulations globally, which can lead to potential liabilities and higher costs, thereby impacting its business operations. Also, Apple’s failure to meet its environmental, social, and governance (ESG) targets could result in liabilities and added costs.
Moreover, Apple is exposed to tax risks due to its global operations, including the possibility of changes in international and domestic tax rules. These legal challenges could impact its financial performance.
Looking at Apple’s Other Risk Categories
Similar to the Legal and Regulatory risk category, Ability to Sell also accounts for 21% of the total risks. Interestingly, the company’s exposure to this risk is higher than the industry average of 17.4%, which is a cause for concern.
Moving on, Production risks are next most significant for AAPL, accounting for 18% of total risks. Moreover, Technology and Innovation, as well as Finance and Corporate, each contribute 14% to the company’s overall risk profile. Lastly, Macro and Political factors make up 11% of Apple’s total risks.
Despite operating in a complex environment with numerous potential risks, Apple has shown resilience in effectively managing these challenges. The company’s successful risk management practices position it well for continued long-term performance.
Is Apple Stock a Buy?
Turning to Wall Street, AAPL has a Moderate Buy consensus rating based on 24 Buys, eight Holds, and two Sells assigned in the last three months. At $245.68, the average Apple price target implies a 9.57% upside potential.
