Shares of the consumer tech giant Apple (AAPL -4.05%) traded about 4% lower today as of 11:14 a.m. ET, after the company reported earnings yesterday. Most stocks were trading higher today, due to positive developments regarding trade negotiations between the U.S. and China. But tariffs continue to weigh on Apple.

Analysts get more bearish on the stock

Apple reported earnings and revenue in its second fiscal quarter that beat estimates from Wall Street analysts. iPhone revenue also beat estimates by $1 billion. But Apple is one of the most heavily impacted tech giants by tariffs because the company makes a ton of its products in China and Vietnam.

Apple CEO Tim Cook said on the company’s earnings call that it expects tariffs to add $900 million of expenses in the current quarter. Apple also guided for low-to-mid-single-digit annualized revenue growth in the current quarter. Cook said it’s “very difficult” to forecast what could happen beyond June due to tariff uncertainty.

This morning, a number of analysts cut their price targets or their ratings on Apple stock. Jefferies analyst Edison Lee cut his rating on Apple to underperform, writing that “tariff impact will expand over time to create more earnings downside.”

Rosenblatt Securities analyst Barton Crockett also lowered his rating on Apple from a buy to neutral. “We’re left with a well-run company, with OK-muted growth, a need for an exciting new product to reinvigorate growth trading at a premium multiple, in a choppy tariff and regulatory environment,” he wrote in a research note.

Image source: Getty Images.

Reprieve may come, but it won’t solve all of Apple’s problems

Following Trump’s pause on tariffs, Apple rebounded from lows and now trades around 29 times forward earnings, slightly above its five-year average. While tensions with China may eventually ease, there still could be some level of tariffs when everything is said and done, which would be much higher than previous years, and Apple may not get a full exemption.

For this reason, I am neutral on the stock. Long term, the tech giant should still perform well, but it’s not trading at that much of a discount when you consider some of the near-term challenges.