6 Reasons to Buy Apple Stock and Never Sell
- The Warren Buffett seal of approval. Investors could do far worse than follow the example of legendary money manager Warren Buffett. ...
- The resurgence of the iPhone. It wasn't terribly long ago that some were declaring the death of the iPhone, but the release of its latest device product lineup has ...
- Apple: It's what the fashionable are wearing. ...
Full Answer
Why now is a good time to buy Apple stock?
Why Apple Is a No-Brainer Stock to Buy Right Now
- Apple thrives despite challenges. The iPhone maker posted record revenue of $123.9 billion for the quarter that ended on Dec. ...
- Jumping into the metaverse. ...
- The services business is going from strength to strength. ...
- The stock is attractively valued. ...
Why should you invest in Apple stock?
- Apple stock at a glance.
- Pros of buying.
- Cons of buying
- Bottom line: Should you buy AAPL?
Why should Apple buy back its own stock?
- Buybacks started in late 2012. ...
- Cash is still king. ...
- Debt can be good as long as it is not excessive. ...
- Net cash (Cash minus debt) The high-water mark for Apple’s net cash position was $162.7 billion in its December 2017 quarter. ...
Why does Apple repurchase so much stock?
- Estimated free cash flow per year: $70 billion
- Dividend payments per year: $14 billion
- Net increase in cash per year: $56 billion
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Even as the most valuable company in the world, there's still lots to like about the iPhone maker
Apple ( AAPL -2.59% ) made history on Aug. 2, 2018, when it became the first U.S. public company in history to achieve a market cap of $1 trillion. Since then, the company has maintained and even extended its lead on the competition, currently clocking in at roughly $2.25 trillion.
1. The Warren Buffett seal of approval
Investors could do far worse than follow the example of legendary money manager Warren Buffett. Since taking the helm of Berkshire Hathaway in 1965, the so-called "Oracle of Omaha" has led investors to breathtaking returns, delivering a compound annual growth rate of more than 20%.
NASDAQ: AAPL
Buffett has made no secret of his love of Apple, saying "It's probably the best business I know in the world." He's gone even further, noting:
2. The resurgence of the iPhone
It wasn't terribly long ago that some were declaring the death of the iPhone, but the release of its latest device product lineup has shown that simply isn't the case. Apple launched four new iPhone models in 2020 -- the most ever released in a single year.
3. Apple: It's what the fashionable are wearing
Investors shouldn't underestimate the growing importance of Apple's wearables business. In fiscal 2020 (ended Sept. 26, 2020), the company's wearables, home, and accessories segment grew 25% compared to 2019, generating a record $30 billion and accounting for more than 11% of Apple's total revenue.
4. It's all about the services
Cook announced in early 2017 that Apple was aiming to double its services revenue by the end of 2020. In July 2020, he revealed that Apple had achieved that lofty goal a full six months ahead of schedule.
5. Dividends: The gift that keeps on giving
Apple resumed its dividend in 2012 after a 17-year hiatus, and it has since become a dividend powerhouse. The quarterly payout resumed at a split-adjusted $0.095 and has risen 132% in just nine years.
NASDAQ: AAPL
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Winners keep on winning
Tech giant Apple ( AAPL -0.94% ) is one of the largest corporations in the world, boasting a monster market cap of $2.7 trillion. It may be difficult to believe that the California-based company still has significant room to grow at these levels.
1. iPhone sales are still going strong
Apple's signature device, the iPhone, was first released in 2007. And while it has become one of the leading smartphones on the market, new releases of the iPhone still generate quite a lot of buzz -- more than 14 years after it was first introduced. Perhaps more importantly, iPhone models continue to generate robust sales for the tech company.
2. Apple's booming services segment
Over the past five years, Apple's services unit has become increasingly important. The company records revenue associated with subscription-based (and other) services in this segment. It includes Apple TV+ revenue, iCloud-related services, Apple Pay, and many other things.
3. Brand names matter
Companies that survive the test of time tend to have one thing in common: a competitive advantage. Of course, that can come in many different forms, be it from high switching costs, the network effect, or intangible assets such as patents and copyrights. Apple also has a solid competitive edge, namely its brand name (an intangible asset).
Don't jump off this ship
Every company faces obstacles, and Apple has recently encountered its share of headwinds. Most notably, the company's supply chain issues have hindered its ability to meet the demand for certain products.
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When was Apple founded?
Apple Stock at a Glance. Founded in 1976, Apple burst onto the scene with the introduction of the Macintosh in 1984, taking the personal computer mainstream.
What is Apple's ecosystem?
One of the biggest things Apple has going for it is the company's "tightly integrated ecosystem" of products that work easily with each other and can be connected with the company's iCloud storage and computing service, says Stephen Lee, founding principal with Logan Capital Management.
When did Apple release the iPod?
From there, he built Apple back to prominence – with the iPod, released in 2001, becoming a blockbuster hit for the company. The 2007 release of the iPhone set in motion a practically unstoppable momentum for the company that continues to the present day.
Does Apple have its own software?
The company' s ability to merge its hardware with its own software and its creation of a product ecosystem that includes the iPhone, Mac, iPad, Apple Watch and Apple TV gives a seamless experience across all devices, adding a level of cushioning against the competition in the ever-changing technology landscape.
Is Apple stock cheap?
That said, the stock isn't cheap.
Is Apple under antitrust?
Potential regulatory risk is hanging over Apple as its App Store has come under increased antitrust scrutiny. More broadly, Big Tech is facing increased political pushback as concerns rise about how much power companies like Amazon.com ( AMZN) and Facebook ( FB) wield.