How much a stock price changes over time is an important driver for most investors. Not only can price performance affect your portfolio, but it can also help you compare investment performance across sectors and industries.
Another thing that can drive investment is the fear of missing out, or FOMO. This is especially true of tech giants and popular stocks that target consumers.
What if you had invested in Apple (AAPL) ten years ago? It may not have been easy to stick to AAPL all that time, but if you did, how much would your investment be worth today?
Apple’s depth in business
With that in mind, let̵
Apple’s business revolves mainly around its flagship iPhone. However, the services portfolio that includes revenue from cloud services, the App Store, Apple Music, AppleCare, Apple Pay and licensing and other services now became cash cow.
Furthermore, non-iPhone devices such as the Apple Watch and AirPod gained significant traction. In fact, Apple dominates the market for wearables and Hearables due to the growing adoption of Watch and AirPods. Solid footage of the Apple Watch also helped Apple strengthen its presence in the personal health monitoring area.
Headquartered in Cupertino, CA, Apple also designs, manufactures and sells the iPad, MacBook and HomePod. These devices are powered by software, including iOS, macOS, watchOS, and tvOS operating systems.
Apple’s other services include subscription-based Apple News +, Apple Card, Apple Arcade, new Apple TV app, Apple TV channels and Apple TV +, a new subscription service.
In fiscal year 2020, Apple generated $ 274.52 billion in total revenue. The company’s flagship device iPhone accounted for 50.2% of total revenue. Services, Mac, iPad and other product categories contributed 19.6%, 11.2%, 8.6% and 10.4% respectively.
Apple primarily reports revenue on a geographic basis, namely America (North and South America), Europe (European countries, India, Middle East and Africa), Greater China (China, Hong Kong and Taiwan), Japan and the rest of Asia -S Pacific (Australia and other Asian countries).
In the financial year 2020, 45.4%, 25%, 14.7%, 7.8% and 7.1%, respectively, of total revenues accounted for the Americas, Europe, Greater China, Japan and the rest of the Asia-Pacific.
Apple faces stiff competition from the likes of Samsung, Xiaomi, Oppo, Vivo, Google, Huawei and Motorola in the smartphone market. Lenovo, HP, Dell, Acer and Asus are the main competitors in the PC market. Other notable competitors are Google & Amazon (smart speakers) and Fitbit & Xiaomi (wearables).
The bottom line
Everyone can invest, but building a successful investment portfolio requires research, patience and some risk. So if you had invested in Apple ten years ago, you probably feel pretty good about your investment today.
According to our calculations, an investment of $ 1,000 in July 2011 will be worth $ 11,149.68, or a gain of 1,014.97% from July 9, 2021, and this return excludes dividends, but includes price increases.
The S&P 500 rose 221.54% and the price of gold increased 12.25% during the same time frame in comparison.
Looking ahead, analysts expect more upside for the AAPL.
Apple benefits from continued momentum in the Services segment, powered by the App Store, Cloud Services, Music, Advertising and AppleCare. Apple’s short-term prospects are bright, powered by new iPhones that support 5G, a renewed iPad and Mac range of devices, a health-focused Apple Watch and a growing App Store ecosystem. Apple’s ability to attract small developers has been an important catalyst. Furthermore, Apple devices continue to gain traction among companies. Apple’s focus on user privacy, which is reflected in the latest iOS 15, iPadOS 15, macOS Monterey and watchOS 8 updates, is a game changer. However, Apple refrained from providing any guidance due to uncertainty triggered by the COVID-19 pandemic. Also, increasing control and legal issues over the App Store are headwinds. Shares have underperformed the S&P 500 so far.
During the last four weeks, the shares have accumulated 13.58%, and there have been 1 higher earnings estimate revisions in the last two months for the financial year 2021 compared with no lower. The consensus estimate has also increased.
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Apple Inc. (AAPL): Free Stock Analysis Report
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