By John Salazar
If we give you a few seconds to think of a “Silicon Valley Giant,” you’ll likely think of Apple as part of your first five options. That’s a reasonable thought, given Apple has indeed made a name for itself since its meteoric rise before the 21st Century.
Unfortunately, as much as we like Apple as consumers, it’s a different thing entirely as an investor. If you have enough money to spare, we can’t just buy Apple stocks “because it’s cool.” And in today’s turbulent financial times, there involves a lot of risk in investing in big brands like Apple. So here’s the question: is it still worth investing in Apple? Here are some things you might want to consider
Are you searching for a vast slate of offerings? Some investors hesitate investing in a company or a brand that relies on one — or even a select — number of brands and products offerings below them. This makes sense, as having “that one okay product” doesn’t necessarily inspire investors to release a lot of money into a venture. Apple breaks this fear by offering a number of tech devices across different uses – be it the smartphone, tablet, desktop, laptop, music players, and even smart speakers. And considering how investors likely already use an Apple product while thinking about making an investment, this in itself is proof that Apple may be worth investing in.
Choose a company with a ton of upcoming products in their slate. We’ve had the massive success of the iPhone 11 and AirPods last 2019, but Apple is rumored to be back for more surprises. Aside from another 16-inch MacBook Pro, there are rumors of over-ear headphones, the iPad Pro 2020, the iPhone 12, and the comeback of the affordable iPhone SE. These products may or may not be coming, but the fact that Apple may be possibly producing them shows great potential in the market.
Aside from new products, Apple also has begun amping up to provide more services for users. In quarter four of 2018 alone, Apple managed to grow its services revenue to $10 billion, or a whopping 27%, courtesy of services such as AppleCar, Apple Music, Apple Pay, the App Store, and the iCloud. And with more arrivals and improvements on these services, it’s no doubt Apple is positioning itself to remain as a major tech player for years to come.
Are you searching for a vast slate of offerings? Some investors hesitate investing in a company or a brand that relies on one – or even a select – number of brands and products offerings below them. This makes sense, as having “that one okay product” doesn’t necessarily inspire investors to release a lot of money into a venture. Apple breaks this fear by offering a number of tech devices across different uses – be it the smartphone, tablet, desktop, laptop, music players, and even smart speakers. And considering how investors likely already use an Apple product while thinking about making an investment, this in itself is proof that Apple may be worth investing in.
Choose a company with a ton of upcoming products in their slate. We’ve had the massive success of the iPhone 11 and AirPods last 2019, but Apple is rumored to be back for more surprises. Aside from another 16-inch MacBook Pro, there are rumors of over-ear headphones, the iPad Pro 2020, the iPhone 12, and the comeback of the affordable iPhone SE. These products may or may not be coming, but the fact that Apple may be possibly producing them shows great potential in the market.
Aside from new products, Apple also has begun amping up to provide more services for users. In Q4 of 2018 alone, Apple managed to grow its services revenue to $10 billion, or a whopping 27%, courtesy of services such as the Apple Card, Apple Music, Apple Pay, the App Store, and iCloud. And with more arrivals and improvements on these services, it’s no doubt Apple is positioning itself to remain as a major tech player for years to come.
Are you searching for a stable player in the market? Despite recessions and slight economic turbulence in the past few years, Apple has proven to remain dominant in its respective markets. And this isn’t exactly an easy feat. Apple has tapped into its strengths producing notable products such as iPhones, Macbooks, iMacs, and the like, as well as taking advantage of tech improvements, the potential of automation and AI, as well as the rise of cheaper and more powerful materials. With these in mind, Apple has proven capable of withstanding negative industry trends and riding positive ones.
When we say Apple, we often think iPhones — and that makes sense, given Apple really relies on the iPhone for profits. And true enough, the iPhone has proven reliable in this regard. In fact, iPhone sales managed to get in $37.1 billion for the company in a financial quarter in 2018 alone. This was 59% of Apple’s total revenue at the time. If you’re looking for a stable market player, Apple may be the one for you.
Apple actually ended 2019 with amazing highlights. Apple’s iPhone line ended the decade as the best-selling tech product. According to Wedbush Securities, Apple’s sold 185 million units – granted, it’s less compared to a 200-million-unit record in previous years, but still the leader in smartphone sales thanks to the arrival of the iPhone 11, the iPhone 11 Pro, and the iPhone 11 Pro Max. Given we’ve received the first iPhone back in 2007, it’s no easy feat to remain as one of the top smartphone brands for the past 12 years.
In terms of the competition, Apple stock isn’t really overvalued compared to other big names in the market. In fact, we still see Apple valued at 19 (based on price-to-earnings ratio). Facebook currently asks for multiples of 30, and Amazon works with 70. Apple stock is comparatively cheaper, and while it might have losses during a recession, it still has a huge potential to jump back.
Are you looking for trendsetters? Nothing speaks of a brand’s status in a market than its ability to start trends. And one could argue that Apple fits this regard because of its sheer influence in the tech sphere. Imagine, Apple continues to break convention with new innovations with its products – such as the keypad-absent in the first-ever iPhone and the earphone jack-less iPhone a few years back. Both met significantly-wild reactions from audiences, but both reached significantly-huge sales regardless. One might argue that it’s worth investing in a brand that can set trends in its market, and Apple surely fits the bill on that end.
Apple has a huge following that most likely established brand loyalty for the tech giant, which explains why its premium pricing is still something that people line up for even today. That’s thanks to Apple’s constant improvements and additions to their products that prove useful and helpful to users – be it from a practical or an aesthetic point of view. It’s this kind of branding that lets Apple ask users for top dollar to avail its services, but still remains on the top of its game.
Given Apple’s tendency to make amazing products and services “out of the blue,” it’s no question how people get excited whenever Apple teases “the next big thing.” This sparks huge potential for both Apple and investors, as their investments in Apple may prove worth the while if Apple’s next “craze” actually succeeds in making money. For instance, Apple can tap into the free online game market and have games like Madalin Stunt Cars 2 be more playable on mobile. Or Apple can even start its entire eSports gaming tournament! The fact that we can think of suggestions left and right, no matter how ridiculous, that proves Apple’s potential to make waves wherever it goes.
Apple takes advantage of current trends and adds spins to them, or succeeds in making hit products. Wearable tech such as smartwatches have risen in sales thanks to Apple’s Apple Watch, and it seems Apple is once again positioning itself to be a leader in the market. With the rise of IoT-based wearable tech, as well as improvements in augmented and virtual reality, it’s no question that Apple will be taking advantage of this opportunity.
Is Apple worth investing in? With the above in mind, it’s clear that the answer can be a resounding yes. Given you have enough funds for an investment, and if you’re focusing on making a portfolio based on assets in the tech industry, Apple is definitely a place you want to put your money in. However, remember to not just put your money in Apple – or any other company – without proper research and consideration.
With the above points, it’s important to assess how having Apple stock can affect your portfolio at large, and what your long-term goals are in order to make the right financial move.
John Salazar is a certified techie-at-heart, but he shares a love for all things science and technology, health and wellness, and even a bit of music on the side. As a creative writer, John makes sure to write both informative and entertaining pieces. He loves writing, and he plays the guitar when he has free time.
