How much a share’s price changes over time is important to most investors, as price characteristics can both affect your investment portfolio and help you compare investment performance across sectors and industries.
Fear of Missing Opportunity, or FOMO, also plays an important role in investing, especially in certain tech giants, as well as in popular consumer-focused stocks.
What if you invested in Apple (AAPL) ten years ago? It may have been tricky to hold onto AAPL all this time, but if that were the case, how much would your investment be worth today?
Apple’s business in detail
With that in mind, let’s take a look at Apple’s main business drivers.
Apple’s business is primarily related to its flagship iPhone. However, the service portfolio, which includes revenues from cloud services, app store, Apple Music, AppleCare, Apple Pay, and licensed and other services, has now become a cash cow.
Moreover, non-iPhone devices such as the Apple Watch and AirPod have gained significant popularity. In fact, Apple dominates the wearable and headphone markets due to the growing adoption of watches and AirPods. The widespread adoption of the Apple Watch has also helped Apple strengthen its presence in the personal health monitoring space.
Headquartered in Cupertino, California, Apple also designs, manufactures, and markets the iPad, MacBook, and HomePod. These devices run software applications including iOS, macOS, watchOS, and tvOS operating systems.
Other Apple services include Apple News + subscription-based, Apple Card, Apple Arcade, new Apple TV app, Apple TV and Apple TV + channels, new subscription service.
In fiscal 2020, Apple’s total revenue was $ 274.52 billion. The company’s flagship device, the iPhone, accounted for 50.2% of total revenue. Services, Mac, iPad and other goods accounted for 19.6%, 11.2%, 8.6% and 10.4%, respectively.
Apple primarily reports revenues by geography, namely the Americas, Europe (European countries, India, the Middle East, and Africa), Greater China (China, Hong Kong, and Taiwan), Japan, and the rest of Asia Pacific (Australia and other Asian countries).
In fiscal 2020, America, Europe, Greater China, Japan and the rest of the Asia-Pacific region accounted for 45.4%, 25%, 14.7%, 7.8% and 7.1% of total revenues, respectively.
Apple faces stiff competition from companies like Samsung, Xiaomi, Oppo, Vivo, Google, Huawei and Motorola in the smartphone market. Lenovo, HP, Dell, Acer and Asus are its main competitors in the PC market. Other notable competitors are Google and Amazon (smart speakers) and Fitbit and Xiaomi (wearables).
Anyone can invest, but building a successful investment portfolio requires a combination of several things: research, patience, and a little risk. So, if you invested in Apple ten years ago, you probably feel good about your investment today.
We estimate that the $ 1,000 investment made in May 2011 will amount to $ 10,657.77 or 965.78% return on May 4, 2021. This income does not include dividends, but includes price increases.
Compare that to the 209.05% rally in the S&P 500 and the 13.59% gold return over the same time period.
Looking ahead, analysts expect more upside potential for AAPL.
Apple’s FY2021 Q2 results reflected continued growth in the services segment, driven by robust performance in the App Store, cloud services, music, advertising and AppleCare. What’s more, iPads, Macs, and wearables have contributed a lot to the quarterly results. In addition, iPhone sales were boosted by strong demand for iPhone 12. iPhone sales rose significantly in China and Japan. Apple did not provide any guidance due to the uncertainty caused by the pandemic. Apple’s near-term outlook is encouraging, driven by new 5G iPhones, a revamped iPad and Mac lineup, a health-oriented Apple Watch, and robust growth in services. However, the tightening of controls and legal concerns over the App Store is a headwind. Stocks have lagged behind the S&P 500 since the start of the year.
The stock is up 5.27% in the past four weeks, and its fiscal 2021 earnings estimate has been revised 11 more than ever. The consensus estimate has also increased.
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Apple Inc. (AAPL): Free Stock Analysis Report
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