Apple (AAPL) has seen its stock plummet this year due to fears about poor macroeconomic conditions, slower growth, and supply bottlenecks. However, with the recent decline in Apple stock, many investors are wondering if AAPL stock is a good investment right now.
Apple unveiled its third-generation 5G handsets, the iPhone 14 series, on September 7. It also unveiled its Apple Watch Series 8 smartwatches and AirPods Pro wireless earbuds in their second iteration. On the news, Apple’s shares jumped 0.9%.
Analysts welcomed the creative new devices, but others expressed concern that the pricey products would be difficult to sell in the current economic environment.
The top-end iPhone 14 Pro versions have been in tremendous demand, while standard models have underperformed.
On Oct. 18, Apple completed its Christmas product range with new iPads and an improved Apple TV streaming video box. That day, AAPL shares rose 0.9%.
Apple warned on November 6 that a Covid outbreak at a Chinese plant might limit the supply of iPhone 14 Pro and Pro Max handsets this holiday season. Apple stated that the Foxconn-owned factory is “working at severely reduced capacity” because of Covid restrictions. According to news accounts, the factory later experienced violent worker protests.
Analysts on Wall Street reduced their iPhone sales projections for the December quarter due to device shortages caused by factory difficulties.
Apple’s Potential for Growth
Investors are asking what the next big growth driver for Apple shares will be as the iPhone business matures.
Apple’s sales and profits have recently been boosted by two businesses: services and wearables.
Analysts are concerned about Apple’s services business’s recent slowing growth.
Apple’s services revenue increased 5% year on year to $19.2 billion in the September quarter. The App Store, AppleCare, iCloud, Apple Pay, Apple Music, Apple TV+, Apple Arcade, and more services are available.
Apple hiked costs for its Apple Music and Apple TV+ services for the first time in late October. It also increased the cost of its Apple One service bundle.
Meanwhile, Apple is being investigated for antitrust violations in the United States, Europe, and Asia for its App Store rules, particularly its 30% commission fee.
Apple Product Speculation In the September quarter, Apple’s Wearables, Home, and Accessories unit saw revenues increase 10% to $9.7 billion. Wearables such as the Apple Watch, AirPods wireless earbuds, and Beats headphones are included in this category. It also includes the Apple HomePod Mini portable speaker and other gadgets.
According to rumors, Apple will release virtual reality and augmented reality headgear in 2023. According to analysts, the computer headset might be a driver of Apple stock.
Meanwhile, rumors persist that Apple is working on a self-driving electric automobile.
Apple Earnings: A Strong Beat
Apple exceeded Wall Street’s expectations for its fiscal fourth quarter on Oct. 27 thanks to strong iPhone and Mac computer sales. In the following trading session, Apple shares rose 7.6%.
In the fiscal quarter ending September 24, Apple earned $1.29 per share on sales of $90.1 billion. FactSet polled analysts, who projected Apple to earn $1.27 per share on $88.7 billion in revenue. Apple’s earnings increased 4% yearly, while sales increased 8%.
Apple, on the other hand, warned that it anticipated slower sales growth in the Christmas quarter.
Apple’s iPhone revenue grew 10% to $42.6 billion in the September quarter. Smartphones accounted for 47% of overall sales for the company throughout the time.
In the meantime, Apple’s Mac computer sales increased by 25% to $11.5 billion.
Apple’s iPad unit was the only one to experience a dip in sales during the quarter. In the fiscal fourth quarter, iPad sales fell 13% to $7.2 billion.
The next earnings report from the corporation will not be issued until late January.
Apple’s stock has dropped from its all-time high.
Apple briefly attained a market value of $3 trillion in intraday trading on January 3 when its shares reached 182.86. That day, Apple shares reached a high of 182.88 before falling back. It was the first corporation to have a market worth $3 trillion.
On January 4, Apple stock surpassed the $3 trillion mark once more. It reached a record high of 182.94 before declining. AAPL stock fell in the weeks that followed, but it has tried to recover multiple times since then.
Apple’s illustrious history
Apple has been a multiple-time American success story. First, with the Apple II in the 1970s, it sparked the personal computer revolution. Then, in the 1980s, it reimagined the PC with the Macintosh.
Steve Jobs, the co-founder of Apple, returned to lead the company in 1997 and led a winning streak of innovations that included the iMac, iPod, iTunes, iPhone, iPad, and the App Store.
The iPhone is the most important driver of Apple’s modern success. The revolutionary smartphone, which debuted in 2007, triggered years of rapid growth and established a dedicated consumer base eager to purchase Apple products and services.
In addition, Apple is ranked fifth on IBD’s 2022 100 Best ESG Companies list. The acronym ESG stands for environmental, social, and governance.
After reaching a record high at the beginning of 2022, Apple shares fell as much as 29%.
The IBD Relative Strength Rating for AAPL is 34 out of 99. The Relative Strength Rating compares a stock’s price performance over the last 52 weeks to that of all other stocks.
Is Apple Stock a Good Investment Right Now?
Right now, Apple stock is NOT a good investment. It is currently selling far below its official buy point.
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