Apple Stock, Share Price and Investing Info | Focus on US Stock Market Today 3Q21 Version
Apple has now become the most valuable company in the world. It has a market capitalization of $2 trillion, and its value continues to rise. Even though it made most of its wealth from selling iPhones, Macs, Apple Watches, and iPads, it still has great potential to earn more from services offered on the iOS platform. That is why investors and consumers alike are attracted to the company, its products, and most importantly, its stock! Investors covet Apple (AAPL) shares because the company has grand plans to bring new products on board, with autonomous vehicles and augmented-reality technology in the pipeline.
The iPhone has been a key driver in Apple’s growth.
On the frontline driving Apple’s success has been the iPhone. Apple is known for releasing products that stay ahead of their time, and the release of the iPhone was a game-changer in the smartphone market. It first emerged in 2007 and has since then triggered over a decade of continued growth while rallying up a loyal fan base. Apple has enjoyed the success that comes from iPhone users who more often than not replace their older versions with the latest versions, in turn attracting more earnings to the company. The year 2021 proves to be an interesting year for iPhones as there is likely going to be a great upgrade cycle as the first 5G iPhones are expected to be released.
Apple shares historically outperform market averages in July-September.
In 3Q21, there is growing excitement surrounding the iPhone 12 that was announced in October 2020. This was expected as historically, volumes have rocketed just months before the next flagship product is announced. Around that time, rumors, fan concepts, leaks, and gossip drive a lot of attention to the brand as Apple fans try to keep up with newer versions. Investor expectations also play an attractive setup on the share prices during the run-up to the September launch event. As a result, investors focus on Apple shares, consistently making the shares outperform the overall market in 2H21.
Investor expectations coupled with the buzz around the September launch, the switch from iPhone 12 to iPhone 13 raises the possibility of a bullish 3Q21 for Apple shares. The setup is attractive for investors and speculators looking to alter their portfolios to reflect changes in Apple performance, with the stock price having already hit all-time highs as of the 09 July 2021 close; $145. Furthermore, investors would be keen to see how the share performs with extra volumes experienced in 1H2021, primarily due to higher than expected demand, especially in China.
Source: Market Watch
Future opportunities for growth
Wearables and services
One issue that most people wonder about is life after the iPhone. The iPhone drove a lot of sales and attention to the Apple brand, but have you ever asked yourself what other mega growth magnet will be? In recent years, services and wearables have attracted more sales and profits on top of what already comes from iPhones and Macs. In 1Q2021, the revenue from Apple’s services was $16.9 billion, signifying a 27% growth. Some of these services include AppleMusic, Apple TV+, iCloud, and the App Store.
There was remarkable growth in sales of Apple’s Wearables and other home accessories, which as a unit rose 25% to reach $7.8 billion during the quarter. The products included in the wearables include AirPods, Beats headphones, and the Apple Watch. Another related item includes the Apple HomePod, which is popular.
As early as 2014, Apple had already started developing a car. However, the company halted the project and opted to focus on developing workable autonomous platforms that would in turn, be sold to other car companies. By then, Apple had already hired skilled technical teams and several poached executives from other competitors. They now focus on developing car interior and exterior concepts, alongside other crucial components like the drive-train and how it interacts with self-drive software.
Important Apple financial statistics
Market Cap $2.41 trillion
Enterprise Value $2.1 trillion
Price/Earnings (P/E) 32
EBITDA $100 billion
Other fundamental reasons to buy Apple stock for the long-term
Apple is a $2.4 trillion company
Apple Inc. made headlines in 2018 after it became the first listed company to ever reach a market capitalization of $1 trillion. It has since then more than doubled in value and has currently reached the $2.4 trillion market cap. This shows that it has kept on extending its lead in the technology industry.
Even though some new investors may remain unsure about whether there is more to achieve in terms of innovation, investors can still count on Apple to tap into new markets, venture into new industries (like motoring). As technology improves, Apple is more likely to identify new opportunities, like in the case with 5G technology. As a result, investors can count on Apple for long-term growth and still be on the safer side compared to other listed companies.
Apple has consistently paid out dividends since 2012. It had stopped giving dividends for 17 years before 2012, but new policies and new profit streams have made sure that the company has given attractive dividends ever since its resumption. In addition, the company announced that it had increased the quarterly payout by 7% to $0.22 in 2021.
Aggressive share repurchasing
Apple consistently buys back shares as part of its capital return policy. The company has been aggressively repurchasing shares in order to keep the share count low and more exclusive to its existing shareholders. Under that strategy, every time there is a share buy-back, investors can expect to own a marginally higher percentage of the company if they hold a single share of the company. In the last 10 years, the number of shares in circulation has declined by approximately 35%. The company gradually applies this policy by retiring 1% of its shares quarterly. In April 2021, Apple announced that it would invest $90 billion towards boosting its share repurchase program.