If you’re into investing, you probably know that tracking how stocks change price over time is pretty crucial. It can mean a lot for your investment portfolio and helps when comparing different sectors or industries.
And let’s not forget FOMO – the fear of missing out on potential gains! This is a hot topic, especially when it comes to big tech companies and popular consumer stocks.
So, imagine if you had thrown down $1000 into Apple (AAPL) ten years ago. It probably wasn’t a walk in the park to hold on to those shares the whole time. But how’s your investment doing now? Let’s break it down.
Understanding Apple’s Business
First off, it’s essential to look at what drives Apple’s success.
Apple is primarily known for its iPhones, but they’ve diversified quite a bit. Their Services section, which includes cloud storage, the App Store, Apple Music, AppleCare, Apple Pay, and other services, has become a substantial revenue stream.
Additionally, non-iPhone products like the Apple Watch and AirPods are gaining popularity, with Apple taking the lead in the wearables market thanks to this growing interest. The success of the Apple Watch also helps Apple make strides in personal health monitoring.
On top of that, Apple is moving into new territory with the launch of Apple Vision Pro, essentially merging the digital and physical worlds.
Based out of Cupertino, California, Apple is also responsible for designing and selling products like the iPad, MacBooks, and HomePods, all supported by their software, which includes iOS, macOS, watchOS, and tvOS.
Other services include subscription offerings like Apple News+, Apple Card, Apple Arcade, the revamped Apple TV app, Apple TV channels, and a fresh subscription service d Apple TV+.
In the fiscal year 2024, Apple pulled in an impressive total of $391.04 billion. The iPhone, with its 51.4% contribution, was the biggest revenue driver, while Services brought in 24.6%. Mac and iPad added 7.7% and 6.8% respectively, and Wearables along with Home and Accessories pitched in 9.5%.
When it comes to revenue reporting, Apple categorizes its earnings geographically, including places like the Americas, Europe, Greater China, Japan, and the Asia-Pacific region.
During fiscal 2024, revenue breakdown showed the Americas took home 42.7%, Europe 25.9%, Greater China 17.1%, Japan at 6.4%, and the Rest of Asia-Pacific contributed 7.8%.
Now, let’s not ignore the competition! Apple faces tough rivals like Samsung, Xiaomi, and Google in the smartphone sector, while companies such as Lenovo and Dell vie for the PC market. Don’t forget about Google’s and Amazon’s smart speakers, as well as wearable tech from Fitbit and Xiaomi.
The Bottom Line
Anyone can give investing a shot, but making a fruitful investment portfolio requires some key ingredients: solid research, a lot of patience, and a sprinkle of risk. If you had invested in Apple ten years back, the odds are you’re feeling pretty good about that choice today!
Your initial $1000 investment from September 2015 would have ballooned to around $8,620.13 by September 2, 2025, which is a mind-blowing gain of 762.01%. This total only reflects appreciation in stock price and doesn’t include dividends.
For some context, that’s huge compared to the S&P 500’s 237.55% gain and gold’s 192.83% rise during that period.
Looking ahead, analysts are optimistic about AAPL’s future. The company is riding high on robust growth in its Services sector, boasting over 1 billion paid subscribers. There’s been substantial yearly growth for both paid accounts and subscriptions in Q3 of fiscal 2025. Viewership for Apple TV+ has surged significantly as well.
For the upcoming September quarter of fiscal 2025, Apple foresees net sales growing in the mid to high single digits compared to last year. They expect the Services growth rate will mirror that of Q2, though gross margin estimates are around 46-47%, taking into account a tariff hit of $1.1 billion. There are some worries about increasing regulations and tariffs that could impact investors, and Apple stock has lagged behind the sector this year.
Interestingly, in the past month, shares spiked by 14.16% and there have been 9 revisions for higher earnings estimates for fiscal 2025, with no downward adjustments. Consensus estimates have bounced back, too.
This article originally published on Zacks Investment Research (zacks.com).
