Hightower Advisors' Stephanie Link has increased her $Apple (AAPL.US)$ stake, with the stock sitting in the bargain bin.
What To Know: Tuesday on CNBC's "Fast Money Halftime Report," Link argued that Apple stock may be set up to outperform this quarter given the current sentiment surrounding the iPhone maker.
"This is a stock that is down 13% from its highs. We know that the numbers have come down for the April quarter, we know that already. We know that China is weak and continues to be down double digits, but I do think that the April quarter will be better than expected," Link said on the show.
iPhone sales in China fell 24% during the first six weeks of the year, according to data from Counterpoint Research. The analyst firm said in a note last week that the sales decline was partly due to increasing competition from local smartphone makers like Huawei, Oppo, Vivo and Xiaomi.
Although iPhone sales are going to be weak, the company's services business is likely to show double-digit growth and earnings should be a bright spot on the back of strong margins, Link said.
Despite being down about 10% since the start of the year, Apple stock has held up better than its mega-cap peers as the Nasdaq has pulled back in recent sessions, Link said.
Apple is now trading around 26 times revised earnings numbers versus its historical average of 36 times, she said: "So I think it's actually a bargain."
Link told CNBC that she "substantially" increased her Apple position this week, with the stock trading at a historically cheap valuation. She noted that she expects Apple to announce a new buyback when the company reports second-quarter results, which should help carry the company into its Worldwide Developers Conference in June where AI will be in focus.
"I do think it's an opportunity," Link said.
Apple is not due to report second-quarter earnings until the beginning of May. Analysts currently expect the iPhone maker to report EPS of $1.51 on quarterly revenue of $90.821 billion. Apple reported EPS of $1.52 on revenue of $94.84 billion in the second quarter of 2023, according to Benzinga Pro.