Is Apple a Good Stock to Buy?
If you are on the path of applying the value investing approach in the stock market? Then you have searched for one of the right companies to invest in which is Apple.
Is Apple a good stock to buy?
Yes, it is one of the best but what makes Apple a good stock.
Is it the right time to buy Apple?
These are some of the leading questions whose answers we will help you understand in this article as we discuss the topic of Is Apple a good stock to buy?
By the end of this article, we promise that not only you will be convinced of how good a stock Apple is but also will look to invest in its stock.
So don’t wait for any more sit back comfortably and enjoy reading your favorite article and know more about Apple as a company and what makes it one of the best stocks available on the USA stock exchange.
Know More About Apple
Apple INC Business Overview
Apple Inc. is a multinational company based in the USA and operates in the space of providing electronic goods and online services to its customers.
By market Cap, it has been the second largest company in the world and the fourth largest PC vendor in the world. It along with Alphabet, Amazon, Meta, and Microsoft form the big 5 companies of IT in the USA.
Stock Price: $153
CEO: Tim Cook (Since 2011)
Founded: 1st April 1976
Headquarters: California United States of America
Founder: Steve Job, Steve Wozniak, Ronald Wayne
Market Capitalization: 2.48$ Trillion
P/E Ratio: 24.88
Dividend Yield: 0.6%
Revenue in FY22: $97.28 Billion
Net Profit Margin FY22: 25.71%
Product and Service Portfolio: Air Pods, Apple TV, iPad, iPhone, MacBook Air, Mac Mini, Mac Pro, Apple App Store, Apple Music, Apple News, Apple Pay, etc.
9 Reasons Why Is Apple a Good Stock to Buy
In this world, there is no such thing as believing words of mouth everyone wants proof and logic to vindicate a statement.
So when we say yes apple is a good stock to buy, reasons are required and here we are with the top 9 reasons which make Apple a good stock to buy:
1. Apple Stock is a good long-term Hold Stock & Here’s Why
As we write about the apple as a good stock it has fallen about 12.77% in the last 6 months. Rising inflation, covid related issues have taken a toll on Apple’s performance in the stock market but the key thing to look at is it also provides a buying opportunity to the investors.
Inflation will come and go but will people stop buying apple products is the key question you should ask yourself.
Why we say it’s a long-term bet is look at its return over a year it has risen by 5% and if you look at its return over 5 years it’s a staggering 300% percent. How many stocks would have given you such returns?
So the conclusion is simple if you want a long-term bet on a stock buy apple stock and wait to reap the rewards.
2. Strong balance Sheet
Whenever one is looking t buy a stock of strong fundamentals one of the biggest parameters we recommend looking for is its balance sheet.
The Income statement can be manipulated to show inflated figures, but balance sheet analysis will show the true picture.
Is apple a good stock to buy? A glance through its balance sheet will show you why. It has a huge cash balance that can weather any storm on the company.
In one of the recent quarterly announcements, we analyzed its cash position to find that Apple INC had $193 billion in cash on hand and If we deduct the debt, Apple still had $73 billion left over.
This shows the strength and might of Apple and gives its investors another reason to buy this excellent stock.
3. Continuous Growth in Service Busines
We all just consider Apple’s business of selling electronic products like mobiles, iPad, etc. but what we failed to notice is how big apple has grown into its service business.
The revenues grew by 17% over the last financial year to $19.8 billion and it covers approximately 20% of the company’s net revenues.
So yes Apple is diversifying, and this is another positive indicator of what it is capable of growing in the future.
Apple’s ability to do good in its new growing service business is a key reason why we consider apple to be a good stock to buy as it shows it can further expand, diversify, and largen its business operations.
4. Strong and Efficient Management
One of the other important aspects of Apple as a stock that makes it a good stock to buy is its strong, efficient, knowledgeable, and experienced managers who have been driving the growth of the company.
Led By CEO Tim Cook Apple has a strong team of management, board of directors, and employees who have been helping the company to reach new heights.
Over the last 5 years, such has been the growth in the company that its stock price surged by 300%.
5. New Opportunities
In modern times having a smartphone and laptop is not enough people also are looking to buy smart watches, smart glasses, and numerous other AI products that have been gaining market demand as people are looking to become technologically advanced.
And the benefit of a high-tech demand world is bound to help Apple as it has got a golden opportunity to expand its products portfolio and increase company sales.
6. Market Leader
Apple continues to be a market leader in the high-cost segment of electronic products and has hardly got any competitors who come close.
Apple products are bought heavily and as income level is rising across the globe a strong surge in lifestyle means apple products are sold well.
Being a market leader with less completion can be considered a key reason why Apple can grow even more in the future as the population of the world increases exponentially and income levels also increase.
People will tend to spend more on buying luxurious items like iPhones and iPads driving the performance of Apple as a company and lead a strong surge in its prices.
7. Brand Loyalty and Stickiness of Apple products
One of the reasons why Apple enjoys a strong customer base who continues to buy its products are unique features and strong security which attract people to buy Apple products and keep buying in the future.
Also, an apple product requires supporting apple products only, for example, if you buy iPhone you will have to use the Apple app store, Apple music, and Air pods to listen to music.
So once you start buying apple products you can’t stop until you buy the full set of its products.
8. Continuous Growth in Service Business
Till now we talked about how apple, as a company has strong growth potential in the future, which is bound to lead to a strong surge in share prices.
But what is the company doing for its shareholders, It has been continuously rewarding its shareholders with dividends and stock buyback to reward them from time to time creating continuous value for shareholders.
9. Investment by Experienced Investors
To further strengthen your trust warren buffet is an investor of Apple and holds a strong chunk of Apple’s net shares. It continues to buy its shares and considers it to be the stock to buy.
We have given the example of warren buffet to show you how an investor who is well versed with all the knowledge of investing in the stock market is confident of the performance of buying stocks of Apple and hence this should answer the question in your mind “Is Apple a good stock to buy”.
So these are the top 9 reasons why one should consider Apple to be a good stock to invest in.
FREQUENTLY ASKED QUESTION (FAQs)
Is there a minimum investment while one is buying Apple stocks?
You can buy a minimum of 1 apple stock there is no fixed minimum investment one needs to make to buy an apple stock however you require to buy at least 1 stock of apple.
So did you enjoy reading about the topic Is Apple a good stock to buy. We would like to express our sincerest gratitude to our readers who are reading this article and supporting us.
We aimed to help our readers understand more about whether Is Apple a good stock to buy by explaining more about the stock in detail and what makes it a good stock to buy.
Hopefully, the insights from this article will help you understand and get an answer to the question Is Apple a good stock to buy.