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12034.0 | 2023-12-16 18:00:00 UTC | Is FlexShares STOXX US ESG Select Index Fund (ESG) a Strong ETF Right Now? | AAPL | https://www.nasdaq.com/articles/is-flexshares-stoxx-us-esg-select-index-fund-esg-a-strong-etf-right-now-0 | Making its debut on 07/13/2016, smart beta exchange traded fund FlexShares STOXX US ESG Select Index Fund (ESG) provides investors broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
Because the fund has amassed over $204.22 million, this makes it one of the average sized ETFs in the Style Box - Large Cap Blend. ESG is managed by Flexshares. Before fees and expenses, this particular fund seeks to match the performance of the STOXX USA ESG Impact Index.
The STOXX USA ESG Select KPIs Index is an optimized index designed to provide broad market exposure that is tilted toward U.S. companies that score better with respect to a small set of environmental, social and governance characteristics and to provide the potential for attractive risk-adjusted performance relative to the STOXX USA 900 Index.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.32%.
The fund has a 12-month trailing dividend yield of 1.11%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Information Technology sector - about 25.80% of the portfolio. Financials and Consumer Discretionary round out the top three.
Taking into account individual holdings, Amazon.com Inc Common Stock Usd 0.01 (AMZN) accounts for about 5.14% of the fund's total assets, followed by Apple Inc (AAPL) and Microsoft Corp Common Stock Usd 0.00000625 (MSFT).
ESG's top 10 holdings account for about 34.71% of its total assets under management.
Performance and Risk
The ETF return is roughly 26.91% so far this year and is up about 26.91% in the last one year (as of 12/19/2023). In the past 52-week period, it has traded between $90.43 and $115.26.
The fund has a beta of 1.03 and standard deviation of 17.87% for the trailing three-year period. With about 266 holdings, it effectively diversifies company-specific risk.
Alternatives
FlexShares STOXX US ESG Select Index Fund is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
JPMorgan Nasdaq Equity Premium Income ETF (JEPQ) tracks ---------------------------------------- and the iShares ESG Aware MSCI USA ETF (ESGU) tracks MSCI USA ESG Focus Index. JPMorgan Nasdaq Equity Premium Income ETF has $8.40 billion in assets, iShares ESG Aware MSCI USA ETF has $13.32 billion. JEPQ has an expense ratio of 0.35% and ESGU charges 0.15%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Blend.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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FlexShares STOXX US ESG Select Index Fund (ESG): ETF Research Reports
Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
Apple Inc. (AAPL) : Free Stock Analysis Report
Microsoft Corporation (MSFT) : Free Stock Analysis Report
iShares ESG Aware MSCI USA ETF (ESGU): ETF Research Reports
JPMorgan Nasdaq Equity Premium Income ETF (JEPQ): ETF Research Reports
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Taking into account individual holdings, Amazon.com Inc Common Stock Usd 0.01 (AMZN) accounts for about 5.14% of the fund's total assets, followed by Apple Inc (AAPL) and Microsoft Corp Common Stock Usd 0.00000625 (MSFT). Click to get this free report FlexShares STOXX US ESG Select Index Fund (ESG): ETF Research Reports Amazon.com, Inc. (AMZN) : Free Stock Analysis Report Apple Inc. (AAPL) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report iShares ESG Aware MSCI USA ETF (ESGU): ETF Research Reports JPMorgan Nasdaq Equity Premium Income ETF (JEPQ): ETF Research Reports To read this article on Zacks.com click here. Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results. | Click to get this free report FlexShares STOXX US ESG Select Index Fund (ESG): ETF Research Reports Amazon.com, Inc. (AMZN) : Free Stock Analysis Report Apple Inc. (AAPL) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report iShares ESG Aware MSCI USA ETF (ESGU): ETF Research Reports JPMorgan Nasdaq Equity Premium Income ETF (JEPQ): ETF Research Reports To read this article on Zacks.com click here. Taking into account individual holdings, Amazon.com Inc Common Stock Usd 0.01 (AMZN) accounts for about 5.14% of the fund's total assets, followed by Apple Inc (AAPL) and Microsoft Corp Common Stock Usd 0.00000625 (MSFT). Making its debut on 07/13/2016, smart beta exchange traded fund FlexShares STOXX US ESG Select Index Fund (ESG) provides investors broad exposure to the Style Box - Large Cap Blend category of the market. | Click to get this free report FlexShares STOXX US ESG Select Index Fund (ESG): ETF Research Reports Amazon.com, Inc. (AMZN) : Free Stock Analysis Report Apple Inc. (AAPL) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report iShares ESG Aware MSCI USA ETF (ESGU): ETF Research Reports JPMorgan Nasdaq Equity Premium Income ETF (JEPQ): ETF Research Reports To read this article on Zacks.com click here. Taking into account individual holdings, Amazon.com Inc Common Stock Usd 0.01 (AMZN) accounts for about 5.14% of the fund's total assets, followed by Apple Inc (AAPL) and Microsoft Corp Common Stock Usd 0.00000625 (MSFT). Making its debut on 07/13/2016, smart beta exchange traded fund FlexShares STOXX US ESG Select Index Fund (ESG) provides investors broad exposure to the Style Box - Large Cap Blend category of the market. | Taking into account individual holdings, Amazon.com Inc Common Stock Usd 0.01 (AMZN) accounts for about 5.14% of the fund's total assets, followed by Apple Inc (AAPL) and Microsoft Corp Common Stock Usd 0.00000625 (MSFT). Click to get this free report FlexShares STOXX US ESG Select Index Fund (ESG): ETF Research Reports Amazon.com, Inc. (AMZN) : Free Stock Analysis Report Apple Inc. (AAPL) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report iShares ESG Aware MSCI USA ETF (ESGU): ETF Research Reports JPMorgan Nasdaq Equity Premium Income ETF (JEPQ): ETF Research Reports To read this article on Zacks.com click here. Making its debut on 07/13/2016, smart beta exchange traded fund FlexShares STOXX US ESG Select Index Fund (ESG) provides investors broad exposure to the Style Box - Large Cap Blend category of the market. |
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12068.0 | 2023-12-15 00:00:00 UTC | Guru Fundamental Report for AAPL | AAPL | https://www.nasdaq.com/articles/guru-fundamental-report-for-aapl-28 | Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. This momentum model looks for a combination of fundamental momentum and price momentum.
APPLE INC (AAPL) is a large-cap growth stock in the Communications Equipment industry. The rating using this strategy is 100% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
FUNDAMENTAL MOMENTUM: PASS
TWELVE MINUS ONE MOMENTUM: PASS
FINAL RANK: PASS
Detailed Analysis of APPLE INC
AAPL Guru Analysis
AAPL Fundamental Analysis
More Information on Dashan Huang
Dashan Huang Portfolio
About Dashan Huang: Dashan Huang is an Assistant Professor of Finance at the Lee Kong Chian School of Business at Singapore Management University. His paper "Twin Momentum" looked at combining traditional price momentum with improving fundamentals to generate market outperformance. In the paper, he identified seven fundamental variables (earnings, return on equity, return on assets, accrual operating profitability to equity, cash operating profitability to assets, gross profit to assets and net payout ratio) that he combined into a single fundamental momentum measure. He showed that stocks in the top 20% of the universe according to that measure outperformed the market going forward. When he combined that measure with price momentum, he was able to double its outperformance.
Additional Research Links
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About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | APPLE INC (AAPL) is a large-cap growth stock in the Communications Equipment industry. Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. | Detailed Analysis of APPLE INC AAPL Guru Analysis AAPL Fundamental Analysis More Information on Dashan Huang Dashan Huang Portfolio About Dashan Huang: Dashan Huang is an Assistant Professor of Finance at the Lee Kong Chian School of Business at Singapore Management University. Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. | Detailed Analysis of APPLE INC AAPL Guru Analysis AAPL Fundamental Analysis More Information on Dashan Huang Dashan Huang Portfolio About Dashan Huang: Dashan Huang is an Assistant Professor of Finance at the Lee Kong Chian School of Business at Singapore Management University. Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. | Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. Below is Validea's guru fundamental report for APPLE INC (AAPL). APPLE INC (AAPL) is a large-cap growth stock in the Communications Equipment industry. |
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12072.0 | 2023-12-14 00:00:00 UTC | 2 Hot Warren Buffett Stocks That Raised Their Dividends This Year | AAPL | https://www.nasdaq.com/articles/2-hot-warren-buffett-stocks-that-raised-their-dividends-this-year | The equity portfolio of Warren Buffett's investment vehicle Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B) is larger than the gross domestic products of many small countries. So you can imagine the rivers of dividend payments the portfolio takes in on an annual basis.
This year has been quite a gusher in that respect for Berkshire, as two of the portfolio's largest holdings declared dividend raises. Let's dig into the payout enhancements from those two big-name companies, Apple (NASDAQ: AAPL) and Bank of America (NYSE: BAC).
1. Apple
Of the two companies, Apple was the first to crank its distribution higher. It declared a 4% dividend raise in May, which pushed the quarterly payout to $0.24 per share. This doesn't exactly make it a high yielder at 0.5% based on the latest stock price.
Regardless, Apple is a cornerstone investment in Berkshire's stock portfolio, to the point where the tech giant comprises a whopping 49% of it. All told, the Berkshire Apple position is worth more than $178 billion at the current share price.
With that kind of commitment, you can bet that Buffett and company are among Apple's most significant and committed bulls. That belief in the company is paying off with the increased dividends -- the May raise marked the 11th year in a row it has upped the payout.
That low yield aside, in other ways Apple has been showing the characteristics of a mature dividend stock with modest growth (or even slight declines, as the company has reported in recent quarters).
Yet the foundational iPhone, now in its 15th (!) iteration, continues to be a hot seller, and services revenue keeps climbing to new highs. Meanwhile, as ever, management is doing a good job of keeping up those comparatively quite lofty net margins (26% in the most recently reported quarter).
We should never thoughtlessly copy the moves of a popular investor or portfolio manager. But Apple is a strong company that generates geysers of cash, and is happy to return a bit of it to its investors.
2. Bank of America
Any guesses as to which storied lender has the second-highest weighting in Berkshire's hallowed equity portfolio? Correct! It's Bank of America (NYSE: BAC), which comprises just under 9% of the total. After the Federal Reserve's recent set of (broadly quite successful) bank stress tests, Bank of America declared a dividend raise of 9%, to $0.24 per share per quarterly distribution. These days, that yields 3%.
The health of a bank is due to prudent management, of course, but it also depends rather heavily on the health of its economy.
Yes, Americans remain worried about inflation eating into their paychecks, but for the most part growth continues to be in the cards. When an economy is thriving, business and individual confidence tend to rise, and those entities are inclined to borrow more money. That, of course, is the core activity of traditional banks.
As a highly visible lender in the U.S., Bank of America has been reaping the benefits of being a major operator in the economy.
In its latest reported quarter, the company managed to increase both its loans and leases outstanding and its credit/debit card spend by around 3% from a year earlier. Not coincidentally, total revenue also advanced by that figure. Combined with increased efficiency engineered by a good management team, net income rose at a sturdy 10% clip.
Meanwhile, within the bank's results were some very encouraging developments. For example, it managed to increase its count of relationships in the lucrative global wealth and investment management segment by 20%. And its global markets division produced 8% growth in securities sales and trading revenue.
As long as the U.S. economy is more or less humming along, Bank of America should continue to do well. And Buffett and his team will continue to own plenty of it.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Let's dig into the payout enhancements from those two big-name companies, Apple (NASDAQ: AAPL) and Bank of America (NYSE: BAC). That low yield aside, in other ways Apple has been showing the characteristics of a mature dividend stock with modest growth (or even slight declines, as the company has reported in recent quarters). In its latest reported quarter, the company managed to increase both its loans and leases outstanding and its credit/debit card spend by around 3% from a year earlier. | Let's dig into the payout enhancements from those two big-name companies, Apple (NASDAQ: AAPL) and Bank of America (NYSE: BAC). The equity portfolio of Warren Buffett's investment vehicle Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B) is larger than the gross domestic products of many small countries. After the Federal Reserve's recent set of (broadly quite successful) bank stress tests, Bank of America declared a dividend raise of 9%, to $0.24 per share per quarterly distribution. | Let's dig into the payout enhancements from those two big-name companies, Apple (NASDAQ: AAPL) and Bank of America (NYSE: BAC). After the Federal Reserve's recent set of (broadly quite successful) bank stress tests, Bank of America declared a dividend raise of 9%, to $0.24 per share per quarterly distribution. Before you buy stock in Apple, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Apple wasn’t one of them. | Let's dig into the payout enhancements from those two big-name companies, Apple (NASDAQ: AAPL) and Bank of America (NYSE: BAC). As long as the U.S. economy is more or less humming along, Bank of America should continue to do well. And Buffett and his team will continue to own plenty of it. |
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12092.0 | 2023-12-13 00:00:00 UTC | Technology Sector Update for 12/14/2023: ADBE, MVIS, AAPL, GOOG | AAPL | https://www.nasdaq.com/articles/technology-sector-update-for-12-14-2023%3A-adbe-mvis-aapl-goog | Tech stocks were mixed Thursday afternoon with the Technology Select Sector SPDR Fund (XLK) decreasing 0.6% and the SPDR S&P Semiconductor ETF (XSD) climbing 3%.
The Philadelphia Semiconductor index rose 2.1%.
In corporate news, Adobe (ADBE) shares tumbled 6.5%, a day after fiscal 2024 revenue guidance disappointed investors.
MicroVision (MVIS) rose 1.9% after the company said it expects its 2023 revenue to be near the top end of its previous forecast of $6.5 million to $8 million.
Apple (AAPL) and Alphabet's (GOOG) Google were asked by the European Commission to provide information on risk-mitigation measures on their app stores, the EU's executive arm said Thursday. Apple fell 0.5%, and Alphabet dropped 1.9%.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Apple (AAPL) and Alphabet's (GOOG) Google were asked by the European Commission to provide information on risk-mitigation measures on their app stores, the EU's executive arm said Thursday. Tech stocks were mixed Thursday afternoon with the Technology Select Sector SPDR Fund (XLK) decreasing 0.6% and the SPDR S&P Semiconductor ETF (XSD) climbing 3%. In corporate news, Adobe (ADBE) shares tumbled 6.5%, a day after fiscal 2024 revenue guidance disappointed investors. | Apple (AAPL) and Alphabet's (GOOG) Google were asked by the European Commission to provide information on risk-mitigation measures on their app stores, the EU's executive arm said Thursday. The Philadelphia Semiconductor index rose 2.1%. MicroVision (MVIS) rose 1.9% after the company said it expects its 2023 revenue to be near the top end of its previous forecast of $6.5 million to $8 million. | Apple (AAPL) and Alphabet's (GOOG) Google were asked by the European Commission to provide information on risk-mitigation measures on their app stores, the EU's executive arm said Thursday. Tech stocks were mixed Thursday afternoon with the Technology Select Sector SPDR Fund (XLK) decreasing 0.6% and the SPDR S&P Semiconductor ETF (XSD) climbing 3%. MicroVision (MVIS) rose 1.9% after the company said it expects its 2023 revenue to be near the top end of its previous forecast of $6.5 million to $8 million. | Apple (AAPL) and Alphabet's (GOOG) Google were asked by the European Commission to provide information on risk-mitigation measures on their app stores, the EU's executive arm said Thursday. Tech stocks were mixed Thursday afternoon with the Technology Select Sector SPDR Fund (XLK) decreasing 0.6% and the SPDR S&P Semiconductor ETF (XSD) climbing 3%. The Philadelphia Semiconductor index rose 2.1%. |
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12138.0 | 2023-12-12 00:00:00 UTC | Up 149% YTD, How High Can Roku (NASDAQ:ROKU) Stock Go in 2024? | AAPL | https://www.nasdaq.com/articles/up-149-ytd-how-high-can-roku-nasdaq%3Aroku-stock-go-in-2024 | Media streaming company Roku’s (NASDAQ:ROKU) impressive third-quarter performance has fueled its stock price, driving it up by 149% year-to-date, outperforming the S&P 500’s (SPX) gain of 22%. Roku's revenue growth has begun to pick up again. Furthermore, the advertising market's recovery could be beneficial to Roku in the short term. However, I believe it could take a few more years for Roku to be profitable, which is why I'm currently bearish on ROKU stock.
Roku’s Q3 Performance Fueled Its Stock Price Performance
Roku is a television streaming platform whose affordability, ease of use, and vast content library have made it a household name. In its recent third quarter, active accounts grew to 75.8 million globally compared to 65.4 million in the prior-year quarter. Plus, global streaming hours on the platform increased by 22% year-over-year in Q3.
What sets Roku apart is its ecosystem, which includes both hardware and software elements. Roku's hardware includes a range of streaming devices that fall under its Devices segment. Thanks to its new Roku-branded televisions, Devices revenue jumped 33% year-over-year to $125.2 million in Q3.
Meanwhile, the Platform segment revenue, generated from content distribution and video advertising, also increased by 18% to $786.8 million from the prior-year quarter.
Roku’s stock price performance this year can be attributed to its strong revenue growth, which came in at 20% year-over-year, reaching $912 million, surpassing the consensus estimate of $857 million.
Profitability is Still a Long Shot
While revenue growth has been impressive, it has not been sufficient to propel the company to profitability. However, Roku is making progress, reporting a positive adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) of $43.4 million for the first time in the quarter.
In an 8-K filing in September, Roku announced that it was undertaking some drastic cost-cutting strategies this year. The goal is to bring down its “year-over-year operating expense growth rate by consolidating its office space utilization, performing a strategic review of its content portfolio, reducing outside services expenses, and slowing its year-over-year headcount expense growth rate through a workforce reduction and limiting new hires, among other measures.”
Strong revenue growth and cost reductions contributed to a positive EBITDA in the third quarter, according to the company. Furthermore, Roku expects the rebound in video ads to continue in Q4, predicting $955 million in revenue for the quarter. Management also stated, “We will continue to operate our business with discipline to defend margins, with a focus on driving positive free cash flow over time.”
Meanwhile, analysts foresee Q4 revenue to be around $966 million, and Roku’s full-year 2023 revenue is expected to increase by 9.8% year-over-year to $3.43 billion.
The competition in the streaming space is heating up. Roku's ability to be profitable in the coming years will be determined by how well it maintains and grows its user base while effectively reducing costs and monetizing its platform.
Is ROKU Stock a Buy, According to Analysts?
Overall, ROKU stock has earned a Moderate Buy consensus rating on TipRanks based on analyst ratings. Recently, Wedbush analyst Alicia Reese raised ROKU stock's price target, citing the possibility that the company's initiatives will result in higher revenue growth and consistent earnings in the long run. The analyst has a Buy rating on the stock.
Meanwhile, Citi analyst Jason Bazinet maintained his Hold rating on the stock, stating that while Roku's financial metrics may improve, the company's long-term outlook remains uncertain.
Out of the 23 analysts covering the stock, eight rate it a Buy, 13 rate it a Hold, and two rate the stock a Sell. ROKU has soared following its third-quarter results, surpassing its average price target of $87.84.
ROKU's high target price of $120, on the other hand, indicates upside potential of 18% in the next 12 months.
Since Roku is not profitable, it can be valued only based on its sales. Based on its estimated revenue growth of 11.8% to $3.84 billion in 2024, Roku is priced at a reasonable forward price-to-sales (P/S) ratio of 3.8, lower than its historical average of 10.8. Roku is also valued cheaper than its bigger competitors in the industry, Netflix (NASDAQ:NFLX) and Apple (NASADAQ:AAPL), which have forward P/S ratios of 5.2 and 7.1, respectively.
The Bottom Line on Roku
Despite the ongoing increase in streaming demand, it has notably declined from the peak levels experienced during the pandemic, as people are spending less time at home. While Roku is reasonably valued for a growth stock, it may be a few years before the company sees green in its bottom line. Until it is profitable, I will be steering clear of Roku.
Disclosure
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Roku is also valued cheaper than its bigger competitors in the industry, Netflix (NASDAQ:NFLX) and Apple (NASADAQ:AAPL), which have forward P/S ratios of 5.2 and 7.1, respectively. Recently, Wedbush analyst Alicia Reese raised ROKU stock's price target, citing the possibility that the company's initiatives will result in higher revenue growth and consistent earnings in the long run. Meanwhile, Citi analyst Jason Bazinet maintained his Hold rating on the stock, stating that while Roku's financial metrics may improve, the company's long-term outlook remains uncertain. | Roku is also valued cheaper than its bigger competitors in the industry, Netflix (NASDAQ:NFLX) and Apple (NASADAQ:AAPL), which have forward P/S ratios of 5.2 and 7.1, respectively. Media streaming company Roku’s (NASDAQ:ROKU) impressive third-quarter performance has fueled its stock price, driving it up by 149% year-to-date, outperforming the S&P 500’s (SPX) gain of 22%. Roku’s Q3 Performance Fueled Its Stock Price Performance Roku is a television streaming platform whose affordability, ease of use, and vast content library have made it a household name. | Roku is also valued cheaper than its bigger competitors in the industry, Netflix (NASDAQ:NFLX) and Apple (NASADAQ:AAPL), which have forward P/S ratios of 5.2 and 7.1, respectively. Media streaming company Roku’s (NASDAQ:ROKU) impressive third-quarter performance has fueled its stock price, driving it up by 149% year-to-date, outperforming the S&P 500’s (SPX) gain of 22%. Roku’s Q3 Performance Fueled Its Stock Price Performance Roku is a television streaming platform whose affordability, ease of use, and vast content library have made it a household name. | Roku is also valued cheaper than its bigger competitors in the industry, Netflix (NASDAQ:NFLX) and Apple (NASADAQ:AAPL), which have forward P/S ratios of 5.2 and 7.1, respectively. However, I believe it could take a few more years for Roku to be profitable, which is why I'm currently bearish on ROKU stock. Roku’s stock price performance this year can be attributed to its strong revenue growth, which came in at 20% year-over-year, reaching $912 million, surpassing the consensus estimate of $857 million. |
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12158.0 | 2023-12-11 00:00:00 UTC | Australia's central bank aims at broad reform for payments systems | AAPL | https://www.nasdaq.com/articles/australias-central-bank-aims-at-broad-reform-for-payments-systems | SYDNEY, Dec 12 (Reuters) - Australia's central bank is considering a slate of new regulations for the payments system to open up the use of mobile wallets, make costs more transparent and allow retailers to put surcharges on buy-now-pay-later services.
In a speech on Friday, Reserve Bank of Australia (RBA) Governor Michele Bullock also outlined efforts to support the struggling business of moving cash around the country and plans to modernise the direct entry system used for salaries and welfare payments which will involve much investment by banks.
The Australian government is greatly expanding the RBA's regulatory power over the payments system, particularly for mobile wallet services offered by the likes of Apple AAPL.O and Google GOOG.O.
Bullock said the powers should be in place sometime next year, allowing the RBA to launch a broad review of the retail payments system.
"Usage of mobile wallets has grown rapidly, but the costs associated with these services remain opaque and payment service providers can face barriers to access," she added. "We will need to consider whether regulatory action is needed in this area."
It will also consider formal regulation to allow retailers to place surcharges on BNPL services, much as they do on credit cards.
Regulation might also be needed to ensure retailers have access to least-cost routing, which financial institutions have been slow to roll out, Bullock said.
The RBA will continue its work on a central bank digital currency (CBDC) and is planning a project to examine how different forms of digital money and infrastructure could support the development of tokenised asset markets in Australia.
It will also support the transition from the venerable Bulk Electronic Clearing System (BECS) to the New Payments Platform (NPP), while expanding the NPP's use for cross-border transactions.
Bullock noted that financial institutions would need to connect to the NPP all relevant accounts that currently send and receive payments via BECS, which processes around three-quarters of non-cash payments by value and is heavily relied on by many businesses and government agencies.
"Completing this will take considerable investment and time," Bullock said. "It is important that work begins now to ensure that end users are not disrupted when BECS is retire."
(Reporting by Wayne Cole; Editing by Richard Chang)
(([email protected]; 612 9171 7144; Reuters Messaging: [email protected]))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The Australian government is greatly expanding the RBA's regulatory power over the payments system, particularly for mobile wallet services offered by the likes of Apple AAPL.O and Google GOOG.O. SYDNEY, Dec 12 (Reuters) - Australia's central bank is considering a slate of new regulations for the payments system to open up the use of mobile wallets, make costs more transparent and allow retailers to put surcharges on buy-now-pay-later services. Bullock said the powers should be in place sometime next year, allowing the RBA to launch a broad review of the retail payments system. | The Australian government is greatly expanding the RBA's regulatory power over the payments system, particularly for mobile wallet services offered by the likes of Apple AAPL.O and Google GOOG.O. SYDNEY, Dec 12 (Reuters) - Australia's central bank is considering a slate of new regulations for the payments system to open up the use of mobile wallets, make costs more transparent and allow retailers to put surcharges on buy-now-pay-later services. Bullock said the powers should be in place sometime next year, allowing the RBA to launch a broad review of the retail payments system. | The Australian government is greatly expanding the RBA's regulatory power over the payments system, particularly for mobile wallet services offered by the likes of Apple AAPL.O and Google GOOG.O. SYDNEY, Dec 12 (Reuters) - Australia's central bank is considering a slate of new regulations for the payments system to open up the use of mobile wallets, make costs more transparent and allow retailers to put surcharges on buy-now-pay-later services. In a speech on Friday, Reserve Bank of Australia (RBA) Governor Michele Bullock also outlined efforts to support the struggling business of moving cash around the country and plans to modernise the direct entry system used for salaries and welfare payments which will involve much investment by banks. | The Australian government is greatly expanding the RBA's regulatory power over the payments system, particularly for mobile wallet services offered by the likes of Apple AAPL.O and Google GOOG.O. SYDNEY, Dec 12 (Reuters) - Australia's central bank is considering a slate of new regulations for the payments system to open up the use of mobile wallets, make costs more transparent and allow retailers to put surcharges on buy-now-pay-later services. Bullock noted that financial institutions would need to connect to the NPP all relevant accounts that currently send and receive payments via BECS, which processes around three-quarters of non-cash payments by value and is heavily relied on by many businesses and government agencies. |
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12181.0 | 2023-12-10 00:00:00 UTC | A Bull Market Is Coming: 3 Top Stocks to Buy Before the End of the Year | AAPL | https://www.nasdaq.com/articles/a-bull-market-is-coming%3A-3-top-stocks-to-buy-before-the-end-of-the-year | Last year, the three major indexes slipped into bear territory, and ever since, the question on everyone's mind has been this: When will the next bull market start? That's impossible to answer, even in a rising market such as the one we've known this year. To officially declare a bull market from this point, indexes must reach a new high. And that hasn't happened yet.
So, how can we be so sure a bull market is on the way? Because history shows us bear environments always lead to these periods of expansion. It's just a matter of time. And while we wait, we can prepare by buying stocks that generally excel in a strong market environment. So, as you get your portfolio ready for the new investing year, here are three top stocks to buy -- to position yourself for a potential bull market win.
Image source: Getty Images.
1. Shopify
Even if you've never heard of Shopify (NYSE: SHOP), you probably have contact with the company on a daily basis. That's because Shopify helps many of your favorite e-commerce companies operate their online stores -- providing a variety of services from creating the website to tracking sales and managing inventory.
Shopify generates revenue in part through services to these clients -- including payment processing fees. So, when clients' revenue climbs, this is great news for Shopify. Most recently, Shopify said its merchants' Black Friday-Cyber Monday sales reached a record high of more than $9 billion. It's also important to note that Shopify is the e-commerce software market leader, with 28% share, according to Statista.
The e-commerce giant has demonstrated a solid growth track record, and in the most recent quarter gave us reason to believe the growth will continue. Revenue and gross profit advanced in the double digits, and the company was free cash flow positive for the fourth straight quarter.
Though Shopify has soared about 100% this year, there's still plenty of room for this stock to rise over the long term -- and especially in a bull market.
2. Etsy
If you're shopping for gifts these days, you may have stumbled across Etsy (NASDAQ: ETSY), a seller of handmade items. But one of the biggest Etsy deals may actually be Etsy stock.
Here's why. First, this company's capital light structure means it doesn't have to invest heavily to grow its business. For example, Etsy sellers run their own shops and take care of stocking and shipping their wares -- so Etsy doesn't have to invest in storage and transport. This capital light structure makes it possible for Etsy to transform 90% of its adjusted EBITDA into free cash flow.
Second, Etsy has managed to keep customers coming back even through tough economic times. This year, habitual customers stabilized at 7 million, and active customers reached a record high of 92 million. The loyalty of customers offers us reason to be confident about future revenue. I also like the fact that Etsy is profitable and has about $1.1 billion in cash.
Meanwhile, the shares trade for 16 times forward earnings estimates, which looks dirt cheap for this solid e-commerce player.
3. Apple
Apple (NASDAQ: AAPL) has a growth track record that speaks for itself. The company has increased key financial metrics, such as earnings and return on invested capital, over time.
AAPL Revenue (Annual) data by YCharts
This is thanks to top products such as the iPhone and Apple Watch, but recently, another area has stood out. And that's services. Now that Apple has built up such a huge user base, it can keep the revenue flowing in by selling services to them. That's exactly what the company has been doing, and it may just be Apple's next big growth driver.
By services, I mean anything from digital content to cloud storage. In the most recent quarter, services revenue reached a record high -- and this momentum is likely to continue thanks to more than 1 billion paid subscriptions.
Apple has what it takes to perform in bear markets and bull markets due to its moat, or competitive advantage. And Apple's moat is its brand strength, with most buyers of Apple products eagerly waiting for the next iPhone or Mac. But, clearly, in a strong market environment, Apple's earnings and shares can truly thrive, making it a top bull market buy.
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Adria Cimino has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple, Etsy, and Shopify. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AAPL Revenue (Annual) data by YCharts This is thanks to top products such as the iPhone and Apple Watch, but recently, another area has stood out. Apple Apple (NASDAQ: AAPL) has a growth track record that speaks for itself. That's because Shopify helps many of your favorite e-commerce companies operate their online stores -- providing a variety of services from creating the website to tracking sales and managing inventory. | Apple Apple (NASDAQ: AAPL) has a growth track record that speaks for itself. AAPL Revenue (Annual) data by YCharts This is thanks to top products such as the iPhone and Apple Watch, but recently, another area has stood out. In the most recent quarter, services revenue reached a record high -- and this momentum is likely to continue thanks to more than 1 billion paid subscriptions. | Apple Apple (NASDAQ: AAPL) has a growth track record that speaks for itself. AAPL Revenue (Annual) data by YCharts This is thanks to top products such as the iPhone and Apple Watch, but recently, another area has stood out. So, as you get your portfolio ready for the new investing year, here are three top stocks to buy -- to position yourself for a potential bull market win. | Apple Apple (NASDAQ: AAPL) has a growth track record that speaks for itself. AAPL Revenue (Annual) data by YCharts This is thanks to top products such as the iPhone and Apple Watch, but recently, another area has stood out. For example, Etsy sellers run their own shops and take care of stocking and shipping their wares -- so Etsy doesn't have to invest in storage and transport. |
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12185.0 | 2023-12-09 00:00:00 UTC | This Is the Most Important AI Company You've Never Heard Of | AAPL | https://www.nasdaq.com/articles/this-is-the-most-important-ai-company-youve-never-heard-of | Artificial intelligence (AI) is the talk of the market, and a handful of stocks, like Nvidia (NASDAQ: NVDA) and Microsoft (NASDAQ: MSFT), have jumped on the year's AI developments. But there's one company that's more critical to AI than you might think.
In this video, Travis Hoium covers Taiwan Semiconductor's (NYSE: TSM) role in the industry and shows why it's one of the safer ways to play AI development today.
*Stock prices used were end-of-day prices of Dec. 6, 2023. The video was published on Dec. 8, 2023.
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Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Travis Hoium has positions in Apple. The Motley Fool has positions in and recommends 10x Genomics, Amazon, Apple, Meta Platforms, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy. Travis Hoium is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through their link they will earn some extra money that supports their channel. Their opinions remain their own and are unaffected by The Motley Fool.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | In this video, Travis Hoium covers Taiwan Semiconductor's (NYSE: TSM) role in the industry and shows why it's one of the safer ways to play AI development today. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. The Motley Fool has positions in and recommends 10x Genomics, Amazon, Apple, Meta Platforms, Nvidia, and Taiwan Semiconductor Manufacturing. | Before you buy stock in Taiwan Semiconductor Manufacturing, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and Taiwan Semiconductor Manufacturing wasn't one of them. See the 10 stocks *Stock Advisor returns as of December 7, 2023 Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. The Motley Fool has positions in and recommends 10x Genomics, Amazon, Apple, Meta Platforms, Nvidia, and Taiwan Semiconductor Manufacturing. | Before you buy stock in Taiwan Semiconductor Manufacturing, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and Taiwan Semiconductor Manufacturing wasn't one of them. See the 10 stocks *Stock Advisor returns as of December 7, 2023 Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. The Motley Fool has positions in and recommends 10x Genomics, Amazon, Apple, Meta Platforms, Nvidia, and Taiwan Semiconductor Manufacturing. | In this video, Travis Hoium covers Taiwan Semiconductor's (NYSE: TSM) role in the industry and shows why it's one of the safer ways to play AI development today. The Stock Advisor service has more than tripled the return of S&P 500 since 2002*. The Motley Fool has positions in and recommends 10x Genomics, Amazon, Apple, Meta Platforms, Nvidia, and Taiwan Semiconductor Manufacturing. |
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12193.0 | 2023-12-08 00:00:00 UTC | Validea Detailed Fundamental Analysis - AAPL | AAPL | https://www.nasdaq.com/articles/validea-detailed-fundamental-analysis-aapl-11 | Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. This momentum model looks for a combination of fundamental momentum and price momentum.
APPLE INC (AAPL) is a large-cap growth stock in the Communications Equipment industry. The rating using this strategy is 100% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
FUNDAMENTAL MOMENTUM: PASS
TWELVE MINUS ONE MOMENTUM: PASS
FINAL RANK: PASS
Detailed Analysis of APPLE INC
AAPL Guru Analysis
AAPL Fundamental Analysis
More Information on Dashan Huang
Dashan Huang Portfolio
About Dashan Huang: Dashan Huang is an Assistant Professor of Finance at the Lee Kong Chian School of Business at Singapore Management University. His paper "Twin Momentum" looked at combining traditional price momentum with improving fundamentals to generate market outperformance. In the paper, he identified seven fundamental variables (earnings, return on equity, return on assets, accrual operating profitability to equity, cash operating profitability to assets, gross profit to assets and net payout ratio) that he combined into a single fundamental momentum measure. He showed that stocks in the top 20% of the universe according to that measure outperformed the market going forward. When he combined that measure with price momentum, he was able to double its outperformance.
Additional Research Links
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About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | APPLE INC (AAPL) is a large-cap growth stock in the Communications Equipment industry. Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. | Detailed Analysis of APPLE INC AAPL Guru Analysis AAPL Fundamental Analysis More Information on Dashan Huang Dashan Huang Portfolio About Dashan Huang: Dashan Huang is an Assistant Professor of Finance at the Lee Kong Chian School of Business at Singapore Management University. Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. | Detailed Analysis of APPLE INC AAPL Guru Analysis AAPL Fundamental Analysis More Information on Dashan Huang Dashan Huang Portfolio About Dashan Huang: Dashan Huang is an Assistant Professor of Finance at the Lee Kong Chian School of Business at Singapore Management University. Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. | Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. Below is Validea's guru fundamental report for APPLE INC (AAPL). APPLE INC (AAPL) is a large-cap growth stock in the Communications Equipment industry. |
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12214.0 | 2023-12-07 00:00:00 UTC | AAPL Stock Outlook : Don’t Be Scared by the Noise | AAPL | https://www.nasdaq.com/articles/aapl-stock-outlook-%3A-dont-be-scared-by-the-noise | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Year-to-date, Apple (NASDAQ:AAPL) stock has risen an impressive 54%. At the same time, it missed expectations and its revenue contracted almost 3% in FY 2023, similarly along with free cash flow and net income. Since 2021, growth has stalled, while operating expenses from R&D have increased, leading many to worry about the future of AAPL stock as R&D expenses grow faster than revenue.
Despite slowing growth, it trades at a P/E ratio of 30.9x compared to the S&Ps 25.24x, over a 22% premium. However, Apple has some key fundamentals that will likely see it continue to be a cash cow in the future.
AAPL Stock and Gen Z
First, it’s a fact that Apple has a firm grip on Gen Z, with 87% saying that they own an iPhone. This isn’t just true for the United States, it’s a trend that is spreading worldwide.
In South Korea, where the most common device is Samsung, only 23% of its population uses an iPhone. However, 52% of people 18-29 own an iPhone. This grew from 44% in just two years. Meanwhile, Samsung’s overall market share has shrunk from 44% to 45%. Globalization will attract more youth to Apple.
Services Are Impressive
Apple’s services segment has grown an impressive 16.3% YoY. Because the services segment is software and inherently high-margin, it has pushed Apple’s overall margin up from 41.8% in 2021 to 44.1% in 2023.
In this time, services have grown to comprise over 35% of the revenue compared to 31%. If this trend continues, margins will continue to improve.
Furthermore, the installed base has continued to grow, providing a steady stream of potential. Since 2018, the installed base has been growing at an average rate of 27% a year. Meanwhile, the percentage of subscribers per installed base has also increased, from roughly 0.18 subscribers per device to 0.5 subscribers per device.
In the future, AI could be a major boost to services revenue. Microsoft’s AI assistant could see $14 billion alone in revenue, with just a 10% take rate of 382 million users. With Apple having access to 2 billion devices, its planned AI rollout will see more usage and could be a major revenue driver.
Dividends and Buybacks
With Apple’s stability in generating cash flow and track record in raising dividends and buying back shares, the stock remains a good long-term investment.
Its 5-year dividend yield is 6.15%, and in the past decade, it has spent almost $600 billion in buying back stores, more than any other U.S. company.
Investors will be rewarded with dividends and buybacks due to the company’s cost control and solid fundamentals.
Valuation
The elephant in the room remains Apple’s valuation and a big reason many are bearish on Apple stock. Looking at its total enterprise value to revenue, it currently trades at 7.59x, just below its all-time high of 8.52x.
For people with a short time horizon, this might mean that Apple’s stock could be risky. The stock’s fundamentals are solid and the business is expected to continue growing with AI integration and attractive software margins.
In addition, Apple’s valuation has lifted as the threat of rising rates has dropped substantially, with inflation cooling. The favorable macro environment, AI applications, and improvement in margins justify Apple’s valuation.
Conclusion
Overall, Apple remains a powerhouse and the device of future generations. Though its valuation seems high, it’s not completely unreasonable. The late Warren Buffet famously advised to buy good businesses at a fair price, and Apple continues to be a good business worthy of holding long term.
Disclaimer: On the date of publication, Michael Que did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Michael Que is a financial writer with extensive experience in the technology industry, with his work featured on Seeking Alpha, Benzinga and MSN Money. He is the owner of Que Capital, a research firm that combines fundamental analysis with ESG factors to pick the best sustainable long-term investments.
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The post AAPL Stock Outlook : Don’t Be Scared by the Noise appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The Rich Use This Income Secret (NOT Dividends) Far More Than Regular Investors The post AAPL Stock Outlook : Don’t Be Scared by the Noise appeared first on InvestorPlace. InvestorPlace - Stock Market News, Stock Advice & Trading Tips Year-to-date, Apple (NASDAQ:AAPL) stock has risen an impressive 54%. Since 2021, growth has stalled, while operating expenses from R&D have increased, leading many to worry about the future of AAPL stock as R&D expenses grow faster than revenue. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Year-to-date, Apple (NASDAQ:AAPL) stock has risen an impressive 54%. Since 2021, growth has stalled, while operating expenses from R&D have increased, leading many to worry about the future of AAPL stock as R&D expenses grow faster than revenue. AAPL Stock and Gen Z First, it’s a fact that Apple has a firm grip on Gen Z, with 87% saying that they own an iPhone. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Year-to-date, Apple (NASDAQ:AAPL) stock has risen an impressive 54%. Since 2021, growth has stalled, while operating expenses from R&D have increased, leading many to worry about the future of AAPL stock as R&D expenses grow faster than revenue. AAPL Stock and Gen Z First, it’s a fact that Apple has a firm grip on Gen Z, with 87% saying that they own an iPhone. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Year-to-date, Apple (NASDAQ:AAPL) stock has risen an impressive 54%. Since 2021, growth has stalled, while operating expenses from R&D have increased, leading many to worry about the future of AAPL stock as R&D expenses grow faster than revenue. AAPL Stock and Gen Z First, it’s a fact that Apple has a firm grip on Gen Z, with 87% saying that they own an iPhone. |
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12228.0 | 2023-12-06 00:00:00 UTC | Decoding Apple’s Stock Trajectory: Time to Buy, Hold, or Sell AAPL? | AAPL | https://www.nasdaq.com/articles/decoding-apples-stock-trajectory%3A-time-to-buy-hold-or-sell-aapl | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Like other “Magnificent Seven” stocks, Apple (NASDAQ:AAPL) shares rallied during November. During the month, AAPL stock rose from $171 to around $190 per share, representing around an 11% increase in the span of a few weeks.
Since late last month, however, AAPL’s latest rally has petered out. Shares are now holding steady near the $190 per share price level. Not only that, concerns about a post-rally pullback are rising.
Commentators and investors are again concerned about valuation, and about the tech giant’s future growth prospects. Yet if it seems like that the latest price action/shifting near-term sentiment is a red flag to sell, think otherwise.
Even if shares encounter near-term weakness (which by the way isn’t set in stone), much still points to this “trillion dollar club” member not only eventually re-hitting past all-time highs, but climbing to substantially higher price levels over time. Here’s why.
AAPL Stock and the Return of Fear, Uncertainty, and Doubt
Since Apple shares plateaued in price around Thanksgiving, fear, uncertainty, and doubt (or FUD) has once again come out of the woodwork. Check out recent commentary about the stock, and you’ll see what I mean.
These bearish arguments about AAPL stock are based upon a cut-and-dry premise: Apple’s valuation is far too high, when you compare it to future growth forecasts. On the surface, I can see why some are making this argument. The current trading price of shares in the tech giant is approximately 29 times forward earnings.
According to sell-side forecasts, Apple’s earnings are expected to rise by 6.7% this fiscal year (ending September 2024), with earnings growth re-accelerating to around 8.9% during the following fiscal year. Still, while I agree AAPL is pricey, some of the negative takes out there, including one from a Seeking Alpha commentator suggesting that the 10-Year Treasury will outperform AAPL over the next few years, seem way too pessimistic.
Future appreciation for the iPhone maker’s shares may arrive more gradually in the future than in the past. However, I wouldn’t jump to the conclusion that shares are doomed to not only underperform the broad market, but Treasuries as well.
Solid Returns Are Well Within Reach
Before fully embracing the most negative views on AAPL stock, remember two important factors. For one, although Apple’s valuation is high compared to the market overall, don’t assume that means the company needs to report off-the-charts growth to maintain this valuation.
AAPL’s blue-chip status and strong financials suggest that a high single-digit earnings growth would be enough to sustain a high-20s forward multiple. This suggests that AAPL could keep rising in tandem with earnings growth. Right off the bat, the aforementioned argument that Apple will underperform 10-year Treasuries (currently yielding around 4.23%) seems dubious.
Second, not only could shares outperform Treasuries, outperforming the broad market over the coming years remains well within reach as well. As Wedbush’s Dan Ives recently pointed out, iPhone 15 sales have been off to a good start this holiday season.
There may be strong potential for results during this quarter, and for the full fiscal year, to handily beat current expectations. Looking at a longer time frame, there’s ample opportunity for Apple to report the elevated growth necessary to really kick shares back into high gear.
The Future Remains Bright, as Bearish Arguments Fall Flat
As I’ve pointed out previously, factors like a rebound in iPad and Mac sales, plus continued growth of Apple’s highly-profitable Services unit, suggest results down the road will come in much stronger than currently anticipated.
Apple has yet to really capitalize on the generative AI trend, but as Morgan Stanley analysts pointed out last month, the company stands to benefit tremendously from the rise of so-called “Edge AI,” or integrating artificial intelligence capabilities into hardware and software applications across the board.
Put simply, the future remains bright. A lot points to a long-term growth resurgence for Apple, thanks to existing and emerging catalysts. Bearish arguments fall flat, with some of them appearing very hyperbolic.
If you own AAPL stock, hang on. If you’ve yet to buy, sit tight and pounce on the next round of major weakness.
AAPL stock earns a B rating in Portfolio Grader.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The #1 AI Investment Might Be This Company You’ve Never Heard Of The Rich Use This Income Secret (NOT Dividends) Far More Than Regular Investors The post Decoding Apple’s Stock Trajectory: Time to Buy, Hold, or Sell AAPL? InvestorPlace - Stock Market News, Stock Advice & Trading Tips Like other “Magnificent Seven” stocks, Apple (NASDAQ:AAPL) shares rallied during November. During the month, AAPL stock rose from $171 to around $190 per share, representing around an 11% increase in the span of a few weeks. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Like other “Magnificent Seven” stocks, Apple (NASDAQ:AAPL) shares rallied during November. AAPL Stock and the Return of Fear, Uncertainty, and Doubt Since Apple shares plateaued in price around Thanksgiving, fear, uncertainty, and doubt (or FUD) has once again come out of the woodwork. During the month, AAPL stock rose from $171 to around $190 per share, representing around an 11% increase in the span of a few weeks. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Like other “Magnificent Seven” stocks, Apple (NASDAQ:AAPL) shares rallied during November. These bearish arguments about AAPL stock are based upon a cut-and-dry premise: Apple’s valuation is far too high, when you compare it to future growth forecasts. During the month, AAPL stock rose from $171 to around $190 per share, representing around an 11% increase in the span of a few weeks. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Like other “Magnificent Seven” stocks, Apple (NASDAQ:AAPL) shares rallied during November. These bearish arguments about AAPL stock are based upon a cut-and-dry premise: Apple’s valuation is far too high, when you compare it to future growth forecasts. This suggests that AAPL could keep rising in tandem with earnings growth. |
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12250.0 | 2023-12-05 00:00:00 UTC | What to Expect from the Magnificent Seven Stocks in 2024 | AAPL | https://www.nasdaq.com/articles/what-to-expect-from-the-magnificent-seven-stocks-in-2024 | I
nvestors don't need to look too far to find the source of the market rally in 2023. It has been driven mostly by the so-called “Magnificent Seven” stocks. Coined by Bank of America analyst Michael Hartnett, the stocks consist of Alphabet (GOOG , GOOGL), Amazon (AMZN), Apple (AAPL), Meta Platforms (META), Microsoft (MSFT), Nvidia (NVDA) and Tesla (TSLA).
Some investors who have missed the massive rally in 2023 are wondering whether there is still room for gains in 2024. Year to date, Apple -- the largest of the bunch in terms of market cap — has retuned by 46%, while Microsoft the second largest, boasts an even more impressive gain of 59%. But the impressiveness doesn’t stop there when considering Tesla has doubled in value, while Meta has enjoyed a remarkable return of 180%.
Never missing an opportunity, even the ETF industry has hopped on the bandwagon. In November, the Roundhill Magnificent Seven ETF (MAGS), a portfolio consisting only of exposure to this basket of stocks, debuted on the market. There are a range of opinions as to whether there are value still be gained in these stocks, which have already been stellar performers, but while their collective valuation might have gotten a bit stretched, their leadership in the markets is undeniable.
The reason for their collective popularity, which can’t be overstated, stems from their exposure to high-growth technologies, such as high-end software and hardware, cloud computing and artificial intelligence. These seven stocks have more than doubled the return of the S&P 500 over the past decade. Armed with tons of cash on the balance sheet, strong cash flows and excellent leadership, they are well-positioned to continue leading their respective markets in 2024.
This belief requires an equal level of conviction in the durability of the current bull market, which has seen some doubters emerge lately. Part of their argument stems from what some perceive as limited stock participation in the S&P 500’s rally. For example, the top seven mega-cap technology companies currently account for the lion's share of the S&P 500's weight, or roughly 28%. Leading the way is Apple: the iPhone maker carries a S&P 500 weighting of 7.5%.
Microsoft is next with a weighting of 6.8% after rising to all-time highs. With a weighing of 3.8%, Alphabet is third after rising near 60% from its 52-week low. Rounding out the next four in order are Amazon (up 61% from its low) with a weighting of 3.1%, the aforementioned Nvidia (weight: 2.9%), Tesla (weight: 1.9%) and Meta Platforms (weight: 1.7%).
While these bearish arguments are fair to point out, it’s also worth noting that the Fed is likely done with its aggressive rate hike stance towards battling inflation. After all, rising interest rates is what triggered the bear market in 2022, applying pressure on businesses, forcing high growth names to borrow money at higher rates to fund their operations. Stocks got punished due to lack of liquidity. But the market is forward-looking and although the Fed signaled it is not done with the rate hike cycle, investors should nonetheless position their portfolios to be on the right side of the pivot in 2024, especially amid clearer signs of dampening inflation risk.
Combined with the fact that the recessionary risk is not where it was, it is appearing that this new bull market is here to stay. Armed with tons of cash on the balance sheet, strong cash flows and excellent leadership, the Magnificent Seven are well-positioned them to continue leading their respective markets in 2024. In other words, even as the Magnificent Seven stocks are at a combined market capitalization of more than $10 trillion, there are still many reasons to expect them to keep winning in 2024.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Coined by Bank of America analyst Michael Hartnett, the stocks consist of Alphabet (GOOG , GOOGL), Amazon (AMZN), Apple (AAPL), Meta Platforms (META), Microsoft (MSFT), Nvidia (NVDA) and Tesla (TSLA). There are a range of opinions as to whether there are value still be gained in these stocks, which have already been stellar performers, but while their collective valuation might have gotten a bit stretched, their leadership in the markets is undeniable. The reason for their collective popularity, which can’t be overstated, stems from their exposure to high-growth technologies, such as high-end software and hardware, cloud computing and artificial intelligence. | Coined by Bank of America analyst Michael Hartnett, the stocks consist of Alphabet (GOOG , GOOGL), Amazon (AMZN), Apple (AAPL), Meta Platforms (META), Microsoft (MSFT), Nvidia (NVDA) and Tesla (TSLA). Armed with tons of cash on the balance sheet, strong cash flows and excellent leadership, they are well-positioned to continue leading their respective markets in 2024. Armed with tons of cash on the balance sheet, strong cash flows and excellent leadership, the Magnificent Seven are well-positioned them to continue leading their respective markets in 2024. | Coined by Bank of America analyst Michael Hartnett, the stocks consist of Alphabet (GOOG , GOOGL), Amazon (AMZN), Apple (AAPL), Meta Platforms (META), Microsoft (MSFT), Nvidia (NVDA) and Tesla (TSLA). Rounding out the next four in order are Amazon (up 61% from its low) with a weighting of 3.1%, the aforementioned Nvidia (weight: 2.9%), Tesla (weight: 1.9%) and Meta Platforms (weight: 1.7%). Armed with tons of cash on the balance sheet, strong cash flows and excellent leadership, the Magnificent Seven are well-positioned them to continue leading their respective markets in 2024. | Coined by Bank of America analyst Michael Hartnett, the stocks consist of Alphabet (GOOG , GOOGL), Amazon (AMZN), Apple (AAPL), Meta Platforms (META), Microsoft (MSFT), Nvidia (NVDA) and Tesla (TSLA). But the impressiveness doesn’t stop there when considering Tesla has doubled in value, while Meta has enjoyed a remarkable return of 180%. Microsoft is next with a weighting of 6.8% after rising to all-time highs. |
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12260.0 | 2023-12-04 00:00:00 UTC | Floods, nine killed as southern India braces for Cyclone Michaung | AAPL | https://www.nasdaq.com/articles/floods-nine-killed-as-southern-india-braces-for-cyclone-michaung | By Jatindra Dash
BHUBANESHWAR, India, Dec 5 (Reuters) - Heavy rains submerged roads in southern India on Tuesday, where at least nine people, including a child, were killed in the flooding and the havoc hours before a severe cyclone was due to make landfall.
Cyclone Michaung is expected to hit the coast of Andhra Pradesh state around 11 a.m. local time (0530 GMT), the weather office said, gusting in with winds of up to 110 kph (70 mph).
Parts of the state are expected to be pelted with more than 200 mm (8 inches) of rain over the next 24 hours, the weather office said, and at least 8,000 people have been evacuated.
A 4-year-old boy died in Tirupati district after a wall fell, C. Nagaraju, executive director of the state's disaster management authority said, while eight people were killed in neighbouring Tamil Nadu state, officials said.
In Tamil Nadu's capital Chennai, a major electronics and manufacturing hub, floodwaters swept away cars and submerged a runway, triggering the shutdown of one of India's busiest airports until Tuesday morning.
The rains have stopped and water has receded at Chennai airport, and the airfield was operational from 9 a.m. local time, a spokesperson for the federal civil aviation ministry said.
The rains and winds also snapped power lines and uprooted trees, officials said, and more than 140 trains and 40 flights were cancelled in Andhra Pradesh.
Taiwan's Foxconn 2317.TW and Pegatron 4938.TW halted Apple AAPL.O iPhone production at their facilities near Chennai due to heavy rains, sources familiar with the matter said on Monday.
In December 2015, floods in Tamil Nadu killed at least 290 people and caused widespread damage.
(Reporting by Jatindra Dash and Rishika Sadam. Additional reporting by Aditi Shah, Writing by Shilpa Jamkhandikar; Editing by Miral Fahmy and Jacqueline Wong)
(([email protected];))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Taiwan's Foxconn 2317.TW and Pegatron 4938.TW halted Apple AAPL.O iPhone production at their facilities near Chennai due to heavy rains, sources familiar with the matter said on Monday. Cyclone Michaung is expected to hit the coast of Andhra Pradesh state around 11 a.m. local time (0530 GMT), the weather office said, gusting in with winds of up to 110 kph (70 mph). In Tamil Nadu's capital Chennai, a major electronics and manufacturing hub, floodwaters swept away cars and submerged a runway, triggering the shutdown of one of India's busiest airports until Tuesday morning. | Taiwan's Foxconn 2317.TW and Pegatron 4938.TW halted Apple AAPL.O iPhone production at their facilities near Chennai due to heavy rains, sources familiar with the matter said on Monday. By Jatindra Dash BHUBANESHWAR, India, Dec 5 (Reuters) - Heavy rains submerged roads in southern India on Tuesday, where at least nine people, including a child, were killed in the flooding and the havoc hours before a severe cyclone was due to make landfall. Cyclone Michaung is expected to hit the coast of Andhra Pradesh state around 11 a.m. local time (0530 GMT), the weather office said, gusting in with winds of up to 110 kph (70 mph). | Taiwan's Foxconn 2317.TW and Pegatron 4938.TW halted Apple AAPL.O iPhone production at their facilities near Chennai due to heavy rains, sources familiar with the matter said on Monday. By Jatindra Dash BHUBANESHWAR, India, Dec 5 (Reuters) - Heavy rains submerged roads in southern India on Tuesday, where at least nine people, including a child, were killed in the flooding and the havoc hours before a severe cyclone was due to make landfall. A 4-year-old boy died in Tirupati district after a wall fell, C. Nagaraju, executive director of the state's disaster management authority said, while eight people were killed in neighbouring Tamil Nadu state, officials said. | Taiwan's Foxconn 2317.TW and Pegatron 4938.TW halted Apple AAPL.O iPhone production at their facilities near Chennai due to heavy rains, sources familiar with the matter said on Monday. By Jatindra Dash BHUBANESHWAR, India, Dec 5 (Reuters) - Heavy rains submerged roads in southern India on Tuesday, where at least nine people, including a child, were killed in the flooding and the havoc hours before a severe cyclone was due to make landfall. Cyclone Michaung is expected to hit the coast of Andhra Pradesh state around 11 a.m. local time (0530 GMT), the weather office said, gusting in with winds of up to 110 kph (70 mph). |
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12293.0 | 2023-12-03 00:00:00 UTC | Got $2,500? 2 Top Stocks That You Can Buy and Hold for a Lifetime | AAPL | https://www.nasdaq.com/articles/got-%242500-2-top-stocks-that-you-can-buy-and-hold-for-a-lifetime-7 | Legendary investor Warren Buffett once said that someone is sitting in the shade today because someone planted a tree a long time ago. It's a great quote about long-term thinking, which translates directly to building wealth through investing.
The goal of any long-term investor should be to find great companies and hold them for a lifetime, letting them lift your portfolio for you. However, that's not easy, because so few companies deserve permanent places in your portfolio.
Buffett's Berkshire Hathaway (NYSE: BRK.B) and technology giant Microsoft (NASDAQ: MSFT) might be as strong a long-term bet as you'll find in the market, and you can buy both for under $2,500. Here is what separates them from the pack.
A company led by Earth's greatest long-term investor
Berkshire Hathaway is Buffett's holding company, the crown jewel of his vaunted investing career. The company owns many businesses, brands, and positions in other public companies. Its largest business segments include railroads, oil and gas pipelines, and insurance, while blue-chip stocks like Apple, Bank of America, and Coca-Cola anchor Berkshire's stock portfolio.
Buffett built Berkshire Hathaway in his image, focusing on resilient business models that never go out of style. That's why Berkshire has owned Geico Insurance since 1995, and has held some of its stock holdings since the late 1980s. Buffett also ensures Berkshire is always well-funded; it has more than $157 billion in cash and short-term investments on its balance sheet today.
Berkshire's earnings based on generally accepted accounting principles (GAAP) fluctuate because of how many moving pieces the company has, but owning the stock is as close as you can get to having Buffett invest on your behalf. And the record speaks for itself: Berkshire's book value has exploded, beating the S&P 500 for decades.
Data source: YCharts
Nobody can guarantee the future, but there isn't much reason to doubt Berkshire. Buffett won't be there forever, which may be Berkshire's biggest risk. Still, one would think he's been preparing for the inevitable, instilling a culture that will carry the company after he's gone. Buffett has even handpicked his successor, naming Greg Abel as the company's next chief executive officer.
The technology titan that keeps evolving
Technology giant and personal computing pioneer Microsoft could be the world's most innovative company. It's hard to stay on top in the technology sector because innovation keeps companies on their toes and creates new competition. But not only are Microsoft's legacy products like its Windows operating system still market-leading brands today, the company has penetrated other markets with leading products, including cloud computing, video gaming, and enterprise software.
Added together, these businesses create cash flow like few others on earth. Annual revenue surpasses $218 billion, and $63 billion of that is free cash flow, an impressive 29% conversion rate. Microsoft carries $144 billion in cash and short-term investments against $71.5 billion in long-term debt from acquiring video game company Activision Blizzard. Microsoft's financials are considered so strong that the company has a coveted AAA credit rating from Standard & Poor's, higher than that of the U.S. government!
Microsoft also has long-term growth opportunities lined up. Azure is the world's second-largest cloud platform after Amazon Web Services. Demand for cloud services should explode, and is forecast to more than double to $1.24 trillion by 2028. The company has tied itself up with OpenAI, the artificial intelligence company behind ChatGPT. Despite recent uncertainty, OpenAI positions Microsoft to benefit from AI's future potential.
Data source: YCharts
You can see what successful innovation has done for the company's growth. As long as Microsoft stays aggressive, it's hard to see its fortunes reversing anytime soon. Investors can slowly buy Microsoft stock and sock it away for years. There aren't many companies you can say that about.
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Bank of America is an advertising partner of The Ascent, a Motley Fool company. Justin Pope has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple, Bank of America, Berkshire Hathaway, and Microsoft. The Motley Fool recommends the following options: long January 2024 $47.50 calls on Coca-Cola. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Buffett's Berkshire Hathaway (NYSE: BRK.B) and technology giant Microsoft (NASDAQ: MSFT) might be as strong a long-term bet as you'll find in the market, and you can buy both for under $2,500. Berkshire's earnings based on generally accepted accounting principles (GAAP) fluctuate because of how many moving pieces the company has, but owning the stock is as close as you can get to having Buffett invest on your behalf. Microsoft's financials are considered so strong that the company has a coveted AAA credit rating from Standard & Poor's, higher than that of the U.S. government! | But not only are Microsoft's legacy products like its Windows operating system still market-leading brands today, the company has penetrated other markets with leading products, including cloud computing, video gaming, and enterprise software. Microsoft carries $144 billion in cash and short-term investments against $71.5 billion in long-term debt from acquiring video game company Activision Blizzard. The Motley Fool has positions in and recommends Apple, Bank of America, Berkshire Hathaway, and Microsoft. | A company led by Earth's greatest long-term investor Berkshire Hathaway is Buffett's holding company, the crown jewel of his vaunted investing career. Berkshire's earnings based on generally accepted accounting principles (GAAP) fluctuate because of how many moving pieces the company has, but owning the stock is as close as you can get to having Buffett invest on your behalf. See the 10 stocks *Stock Advisor returns as of November 29, 2023 Bank of America is an advertising partner of The Ascent, a Motley Fool company. | The company owns many businesses, brands, and positions in other public companies. * They just revealed what they believe are the ten best stocks for investors to buy right now... and Berkshire Hathaway wasn't one of them! The Motley Fool has positions in and recommends Apple, Bank of America, Berkshire Hathaway, and Microsoft. |
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12302.0 | 2023-12-02 00:00:00 UTC | Warren Buffett's Best 3 Artificial Intelligence (AI) Stocks | AAPL | https://www.nasdaq.com/articles/warren-buffetts-best-3-artificial-intelligence-ai-stocks | Most people don't associate Warren Buffett with tech trends, as he has consistently avoided investing in many new technologies because he says he doesn't understand them. Even though his company owns a lot of Apple, it's a relatively simple business because it's all about selling hardware. While some may snicker at this comment of not investing in tech, few can deny that this approach has worked well for him and Berkshire Hathaway.
Still, that doesn't mean that Buffett doesn't own any stocks associated with artificial intelligence (AI). In fact, there are quite a few in his portfolio. Among them are Amazon (NASDAQ: AMZN), Snowflake (NYSE: SNOW), and Mastercard (NYSE: MA), and each looks like a candidate to be bought now.
AI may not be the first reason these stocks were purchased
Each of these companies uses AI differently than the others.
For Amazon, its usage is twofold. First, it uses AI to make its delivery business more efficient and predict product demand. Second, Amazon Web Services (AWS) is a cloud computing juggernaut, which positions it well as companies use cloud computing to store proprietary data needed for AI models and develop their own. Amazon may not be the most "in your face" AI investment, but it is near the top of the list for companies that will benefit from AI adoption.
Snowflake is more of a straight-line AI investment, as its data cloud software helps its clients store information efficiently and use it to create AI models. Furthermore, clients can sell their datasets on the Snowflake marketplace, which is incredibly useful for developing an AI model if you don't have the raw data. Berkshire Hathaway bought Snowflake stock at its IPO and hasn't sold a share since, showing its confidence in its future.
Finally, Mastercard, the credit card giant, deploys AI to prevent fraud and safeguard transactions. Now, Mastercard is expanding its consulting practice, which uses its economic data to analyze purchases from all over the globe. AI is invaluable for retailers and can deliver real-time insights, allowing clients to adjust their strategies faster than ever before.
All three companies have legitimate investment cases as AI companies but are also devoted to their primary missions. This makes them great investments as they are less likely to get caught up in the AI hype.
Still, Berkshire is a relatively small shareholder in these businesses as Amazon, Snowflake, and Mastercard only make up 0.4%, 0.3%, and 0.5% of its investing portfolio, respectively. But that doesn't mean they or you can't purchase shares at a moment's notice.
Each looks like a buy right now
Each of these companies is in a different phase. Mastercard is the most mature and has developed its margins to near-optimized levels. Amazon is in a transitional phase of optimizing for profits, and Snowflake is still in a growth-at-all-costs mindset, which causes it to be deeply unprofitable. As a result, each of these companies needs to be examined using a slightly different metric.
For Mastercard, I'll use its price-to-earnings (P/E) ratio, as we have strong historical data of its usual trading range.
MA PE Ratio data by YCharts.
Mastercard has often fetched a premium price (and it still does), but right now, it is near the cheapest you've been able to purchase the stock since 2018 (besides a few momentary dips).
Amazon is nearing full-term profitability, so I'll use the forward P/E ratio.
AMZN PE Ratio (Forward 1y) data by YCharts.
A valuation of 43 times 2024 earnings isn't a cheap price to pay, but those are analyst estimates that can be wrong. AWS is a sleeping giant that will benefit tremendously from AI investment, and its improving margin picture will continue to make Amazon an attractive stock. While it's likely too expensive for Berkshire's taste, I think it's still a fair price.
Last is Snowflake, whose price-to-sales ratio is quite expensive.
SNOW PS Ratio data by YCharts.
Because Snowflake has placed itself into a lucrative opportunity, investors have bid up the stock drastically in expectation of future performance. There's no sugarcoating it; Snowflake stock is incredibly expensive, but if it's as vital to AI as many think, the price you pay today will be worth it years later.
While Buffett may not be known as an AI investor, his portfolio indicates otherwise. All three stocks are solid picks, and investors should be willing to purchase them at today's prices.
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Keithen Drury has positions in Amazon, Mastercard, and Snowflake. The Motley Fool has positions in and recommends Amazon, Apple, Berkshire Hathaway, Mastercard, and Snowflake. The Motley Fool recommends the following options: long January 2025 $370 calls on Mastercard and short January 2025 $380 calls on Mastercard. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Furthermore, clients can sell their datasets on the Snowflake marketplace, which is incredibly useful for developing an AI model if you don't have the raw data. Berkshire Hathaway bought Snowflake stock at its IPO and hasn't sold a share since, showing its confidence in its future. AWS is a sleeping giant that will benefit tremendously from AI investment, and its improving margin picture will continue to make Amazon an attractive stock. | Among them are Amazon (NASDAQ: AMZN), Snowflake (NYSE: SNOW), and Mastercard (NYSE: MA), and each looks like a candidate to be bought now. Second, Amazon Web Services (AWS) is a cloud computing juggernaut, which positions it well as companies use cloud computing to store proprietary data needed for AI models and develop their own. The Motley Fool has positions in and recommends Amazon, Apple, Berkshire Hathaway, Mastercard, and Snowflake. | AI may not be the first reason these stocks were purchased Each of these companies uses AI differently than the others. Amazon may not be the most "in your face" AI investment, but it is near the top of the list for companies that will benefit from AI adoption. Snowflake is more of a straight-line AI investment, as its data cloud software helps its clients store information efficiently and use it to create AI models. | Still, Berkshire is a relatively small shareholder in these businesses as Amazon, Snowflake, and Mastercard only make up 0.4%, 0.3%, and 0.5% of its investing portfolio, respectively. Each looks like a buy right now Each of these companies is in a different phase. The Motley Fool has positions in and recommends Amazon, Apple, Berkshire Hathaway, Mastercard, and Snowflake. |
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12313.0 | 2023-12-01 00:00:00 UTC | Looking for Income? These 3 Unusually Active Options Should Generate Income Over the Next 7 Days | AAPL | https://www.nasdaq.com/articles/looking-for-income-these-3-unusually-active-options-should-generate-income-over-the-next-7 | The S&P 500 gained 8.9% in November, the second-best November performance since 1980. Only November 2020 did better. The penultimate month of the year is starting to look like a sure-fire winner. In the past decade, the index has finished in negative territory on just one occasion, in 2021.
The Federal Reserve is expected to leave interest rates alone when it meets for the last time in 2023 on Dec. 13. That should be good for stocks in December, prompting many to suggest that a Santa rally is here and could continue for weeks.
However, PNC Asset Management Group chief investment officer Amanda Agati told Yahoo Finance on Tuesday that a Santa Claus rally is unlikely.
“I think what we're left with is a bit of a rangebound kind of choppy market from here through year-end,” Agati said.
So, with uncertainty about the markets’ momentum, it might be time to look for a few income plays heading into December. These three unusually active options from Thursday should help get you started.
Have an excellent weekend!
Snowflake
Snowflake (SNOW) stock gained more than 26% over the past month. The data-as-a-service (DaaS) cloud computing company is now up 35% year-to-date, with one left in the year before closing the books on 2023 trading.
Although I wouldn’t sneeze at a 26% gain in a single month, SNOW stock has traded near $400 on two occasions in the past five years -- November 2021 and December 2020 -- so there’s plenty of room for Snowflake’s share price to run in the months ahead.
Berkshire Hathaway (BRK.B), Warren Buffett’s holding company, owns 1.9% of Snowflake, a position taken in 2020’s third quarter at an average price of $238.10, well above where it’s currently trading. He can afford to be patient with his investments.
Analysts generally like Snowflake. Of the 34 that cover its stock, 24 rate it a Moderate or Strong Buy (4.29 out of 5). However, the target price of $187.24 is only a few dollars higher than where it’s currently trading.
The company reported Q3 2024 results on Wednesday. They were very healthy, with revenues of $734 million, 32% higher than a year earlier and more than $20 million higher than the analyst estimate. On the bottom line, its adjusted earnings per share were $0.25, nine cents higher than the consensus.
It finished the quarter with remaining performance obligations of $3.7 billion, 23% higher than a year ago, with 436 customers generating more than $1 million over the trailing 12 months.
For 2024, it expects revenues to grow by 37% to $2.65 billion, with an operating margin of 7%, both higher than analyst expectations.
The income play is the Dec. 8 $180 put. If you sell one of those bad boys, you’ll pocket $140 per contract should its share price remain above $180 for the next week. The annualized yield of 42%. Should it fall to $180, your net price would be $178.60.
Given the latest results, it’s hard to see its shares retreating much between now and next Friday.
Apple
Apple (AAPL) had seven unusually active options on Thursday, with Vol/OI ratios ranging from a low of 1.30 to a high of 8.87.
I’ve narrowed it down to two calls: Dec. 8 $187.50 and Dec. 8 $197.50. The former Vol/OI was 8.87, while the latter’s was 1.99. Their ask prices were $3.55 and $0.11, respectively.
Ok, first, I’m going to assume you know why Apple is Berkshire Hathaway’s largest equity holding by a country mile, accounting for 48.2% of its $363 billion equity portfolio.
So, based on yesterday’s closing price of $189.95, AAPL stock has to rise by 2.6% or $5.02 in the next week to double your money on the $187.50 call. For the $197.50 call, the share price has to rise by 1.0% or $1.92 by next Friday to double your money.
As I write this, AAPL stock is up $1.40 in Friday trading, getting you nearly three-quarters of the way to the $1.92 bump needed on the $197.50 call. Today's ask price is up a penny to $0.12, with a $1.88 increase required to double your money.
This would be the safest of the three bets.
Beyond Meat
There is a good possibility that the struggling plant-based food company’s stock bottomed in late October at around $5.58. Since hitting a 52-week low, Beyond Meat (BYND) is up 34%. While it’s got a long way to go to get back to $235, where it traded in 2019, I think there are brighter times ahead for the company and its stock.
As I write this, halfway through Friday trading, Beyond Meat’s options volume is already at 16,402, nearly 80% of its 30-day average. The number of shares traded is relatively decent at 1.14 million, roughly half its 30-day average.
So, BYND had five options with unusual options activity on Thursday. I’m interested in the one with the highest volume-to-open-interest (Vol/OI) ratio. That would be the Dec. 8 $6.50 put with a 9.30 Vol/OI.
If you sell this contract, the bid of $0.35 is an annualized yield of 250%. It’s that high because of the risk associated with owning BYND stock.
While I understand one’s apprehension about making this bet -- it’s definitely an aggressive play -- I wouldn’t suggest it if it were longer than a week or two.
Beyond Meat reported its Q3 2023 results in early November, which were awful. Revenues fell 8.7% to $75.3 million, while it lost $57.5 million on an adjusted EBITDA basis, down from $73.8 million a year earlier.
“As we shared last week, we are conducting a review of our global operations for purposes of further and significantly reducing our operating expense base as we seek to accelerate our transition to a sustainable and, ultimately, profitable business,” stated CEO Ethan Brown.
Beyond Meat’s operating expenses fell by 29% to $182.3 million through the first nine months of the year. As it continues to hack away at its costs, the cash saved gives it more time to figure out a way out of the deep hole it’s dug for itself.
The company’s $1.15 billion in 0% convertible senior notes due March 15, 2027, have a fair value of $299 million, or just 26% of the face value. I’m not a credit expert, but those would be a possible contrarian buy, possibly a much better opportunity than its stock.
But that is a subject for another day.
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Everything You Need to Know About Michael Burry's 'Big Short' Bet on Chip Stocks
On the date of publication, Will Ashworth did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Apple Apple (AAPL) had seven unusually active options on Thursday, with Vol/OI ratios ranging from a low of 1.30 to a high of 8.87. So, based on yesterday’s closing price of $189.95, AAPL stock has to rise by 2.6% or $5.02 in the next week to double your money on the $187.50 call. As I write this, AAPL stock is up $1.40 in Friday trading, getting you nearly three-quarters of the way to the $1.92 bump needed on the $197.50 call. | Apple Apple (AAPL) had seven unusually active options on Thursday, with Vol/OI ratios ranging from a low of 1.30 to a high of 8.87. So, based on yesterday’s closing price of $189.95, AAPL stock has to rise by 2.6% or $5.02 in the next week to double your money on the $187.50 call. As I write this, AAPL stock is up $1.40 in Friday trading, getting you nearly three-quarters of the way to the $1.92 bump needed on the $197.50 call. | So, based on yesterday’s closing price of $189.95, AAPL stock has to rise by 2.6% or $5.02 in the next week to double your money on the $187.50 call. Apple Apple (AAPL) had seven unusually active options on Thursday, with Vol/OI ratios ranging from a low of 1.30 to a high of 8.87. As I write this, AAPL stock is up $1.40 in Friday trading, getting you nearly three-quarters of the way to the $1.92 bump needed on the $197.50 call. | So, based on yesterday’s closing price of $189.95, AAPL stock has to rise by 2.6% or $5.02 in the next week to double your money on the $187.50 call. Apple Apple (AAPL) had seven unusually active options on Thursday, with Vol/OI ratios ranging from a low of 1.30 to a high of 8.87. As I write this, AAPL stock is up $1.40 in Friday trading, getting you nearly three-quarters of the way to the $1.92 bump needed on the $197.50 call. |
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12325.0 | 2023-11-30 00:00:00 UTC | Judge set to rule on Berkshire Hathaway request for speedy trial over Pilot unit | AAPL | https://www.nasdaq.com/articles/judge-set-to-rule-on-berkshire-hathaway-request-for-speedy-trial-over-pilot-unit | By Jonathan Stempel
Nov 30 (Reuters) - A Delaware judge said she will decide by Friday whether to give Warren Buffett's Berkshire Hathaway BRKa.N a January trial date over a dispute of how to value truck stop operator Pilot Travel Centers, alongside a related lawsuit by the billionaire Haslam family.
Berkshire already owns 80% of Pilot, having paid the Haslams $2.76 billion for a 38.6% stake in 2017 and $8.2 billion for another 41.4% in January.
The dispute concerns how much Berkshire would owe if the Haslams, including Cleveland Browns owner Jimmy Haslam, exercised their option to sell the remaining 20% in the first two months of 2024.
Each side accuses the other of trying to manipulate Pilot's earnings, the basis for valuing that stake.
At a Thursday hearing in Delaware Chancery Court, Vice Chancellor Morgan Zurn told Berkshire's lawyer Craig Jennings Lavoie: "I am going to get you an answer by the end of the day tomorrow" on whether both cases can be tried together.
"I have to be satisfied that there is harm to your client that won't be remedied if I don't give you the equitable relief that you're asking for," Zurn said.
The Haslams sued Omaha, Nebraska-based Berkshire in October, accusing it of seeking a "windfall" by adopting "pushdown" accounting for Pilot, requiring it take on higher depreciation and amortization costs and lowering earnings.
Berkshire countersued on Nov. 28, saying Jimmy Haslam tried to bribe Pilot executives with millions of dollars to inflate earnings in 2023 at the expense of future years.
BERKSHIRE ALLEGES 'CLOUD OF MISCONDUCT'
At Thursday's hearing, Lavoie said Haslam made "at least 28" promises of secret side payments to Pilot executives, at above their annual salaries.
Lavoie said Haslam's push to align the executives' financial interests with his own amounted to a "cloud of misconduct" and "obvious breach of fiduciary duty," and Berkshire would be irreparably harmed if forced to possibly overpay for Pilot.
"We don't view it as a particularly complex case," Lavoie said.
Anitha Reddy, a lawyer for the Haslams, countered that Berkshire - which has one of corporate America's largest and strongest balance sheets - could not claim irreparable harm from possibly overpaying.
"How could they?" she said. "It's just a matter of money."
According to court papers, the Haslams believe the 20% Pilot stake was worth $3.2 billion before Berkshire's accounting change, an amount Berkshire disputes.
The family also includes former Tennessee Governor Bill Haslam, and Jimmy's father, Jim Haslam, who founded Pilot in 1958 after paying $6,000 for a Virginia gas station.
Pilot is based in Knoxville, Tennessee. It has approximately 800 locations in the United States and Canada, and has this year added $380 million to Berkshire's profit through September.
Buffett said at Berkshire's annual meeting in May he wished he could have bought all of Pilot in 2017, but the Haslams did not want to sell.
Berkshire also owns dozens of other businesses including the BNSF railroad and Geico car insurer, and big stakes in Apple AAPL.O, Bank of America BAC.N and other stocks.
The case is Pilot Corp v Abel et al, Delaware Chancery Court, No. 2023-1068-MTZ.
(Reporting by Jonathan Stempel in New York; Editing by Lincoln Feast.)
(([email protected]; +1 646 223 6317; Reuters Messaging: [email protected]))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Berkshire also owns dozens of other businesses including the BNSF railroad and Geico car insurer, and big stakes in Apple AAPL.O, Bank of America BAC.N and other stocks. By Jonathan Stempel Nov 30 (Reuters) - A Delaware judge said she will decide by Friday whether to give Warren Buffett's Berkshire Hathaway BRKa.N a January trial date over a dispute of how to value truck stop operator Pilot Travel Centers, alongside a related lawsuit by the billionaire Haslam family. At a Thursday hearing in Delaware Chancery Court, Vice Chancellor Morgan Zurn told Berkshire's lawyer Craig Jennings Lavoie: "I am going to get you an answer by the end of the day tomorrow" on whether both cases can be tried together. | Berkshire also owns dozens of other businesses including the BNSF railroad and Geico car insurer, and big stakes in Apple AAPL.O, Bank of America BAC.N and other stocks. Berkshire already owns 80% of Pilot, having paid the Haslams $2.76 billion for a 38.6% stake in 2017 and $8.2 billion for another 41.4% in January. At a Thursday hearing in Delaware Chancery Court, Vice Chancellor Morgan Zurn told Berkshire's lawyer Craig Jennings Lavoie: "I am going to get you an answer by the end of the day tomorrow" on whether both cases can be tried together. | Berkshire also owns dozens of other businesses including the BNSF railroad and Geico car insurer, and big stakes in Apple AAPL.O, Bank of America BAC.N and other stocks. By Jonathan Stempel Nov 30 (Reuters) - A Delaware judge said she will decide by Friday whether to give Warren Buffett's Berkshire Hathaway BRKa.N a January trial date over a dispute of how to value truck stop operator Pilot Travel Centers, alongside a related lawsuit by the billionaire Haslam family. Lavoie said Haslam's push to align the executives' financial interests with his own amounted to a "cloud of misconduct" and "obvious breach of fiduciary duty," and Berkshire would be irreparably harmed if forced to possibly overpay for Pilot. | Berkshire also owns dozens of other businesses including the BNSF railroad and Geico car insurer, and big stakes in Apple AAPL.O, Bank of America BAC.N and other stocks. Berkshire already owns 80% of Pilot, having paid the Haslams $2.76 billion for a 38.6% stake in 2017 and $8.2 billion for another 41.4% in January. At Thursday's hearing, Lavoie said Haslam made "at least 28" promises of secret side payments to Pilot executives, at above their annual salaries. |
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12349.0 | 2023-11-29 00:00:00 UTC | Half of This Massive ETF Is Invested in the "Magnificent Seven." But Is It a Buy Now? | AAPL | https://www.nasdaq.com/articles/half-of-this-massive-etf-is-invested-in-the-magnificent-seven.-but-is-it-a-buy-now | The Magnificent Seven have captivated markets this year, and for good reason. The term, coined by Bank of America analyst Michael Hartnett, is used to describe Apple (NASDAQ: AAPL), Microsoft (NASDAQ: AAPL), Alphabet (NASDAQ: GOOG)(NASDAQ: GOOGL), Amazon (NASDAQ: AMZN), Nvidia (NASDAQ: NVDA), Meta Platforms (NASDAQ: META), and Tesla (NASDAQ: TSLA).
Combined, these companies have a market cap of $11.83 trillion. And all seven stocks are beating the market so far year to date, from Apple's 46.7% year-to-date (YTD) gain to Nvidia's blistering 242.3% YTD gain.
The Vanguard Growth exchange-traded fund (ETF) (NYSEMKT: VUG) includes 221 stocks, but the Magnificent Seven make up just over half of the fund's allocation. Here's why the ETF is a good way to invest in the Magnificent Seven, as well as other parts of the market.
Image source: Getty Images.
A magnificent year
The Vanguard Growth ETF has nearly double its exposure to the Magnificent Seven as the Vanguard S&P 500 ETF (NYSEMKT: VOO), which is a near mirror image of the S&P 500.
COMPANY
% OF VANGUARD GROWTH ETF
% OF VANGUARD S&P 500 ETF
Apple
13%
7.09%
Microsoft
12.88%
7.1%
Alphabet
6.94%
3.87%
Amazon
6.33%
3.42%
Nvidia
4.9%
2.85%
Meta Platforms
3.43%
1.89%
Tesla
2.78%
1.57%
Total
50.26%
27.79%
Data Source: Vanguard.
Interestingly enough, the Vanguard Growth ETF is more than doubling the percentage return of the S&P 500.
AAPL data by YCharts
A focus on growth instead of value and income
If you're interested in the Magnificent Seven, chances are you are interested in growth and dominant industry-leading companies, and are willing to pay a premium price for a stock relative to the market. The Vanguard Growth ETF checks all of those boxes and then some. For starters, it is one of the largest ETFs out there, with a massive $170.7 billion in net assets.
The 214 stocks in the index outside of the Magnificent Seven include a lot of companies that wouldn't be considered traditional growth stocks.
For example, Visa (NYSE: V) and Mastercard (NYSE: MA) are the ninth- and tenth-largest holdings in the fund. But they are the only companies of meaningful weight from the financial sector in the ETF. This is a stark contrast to the two largest financials in the S&P 500, which are Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) and JPMorgan Chase (NYSE: JPM).
All four companies are industry leaders and massive behemoths in terms of their size. But Visa and Mastercard are on the growth side of the financial spectrum, more so than Berkshire's property and casualty insurance business or a diversified bank like JPMorgan. They are also more expensive stocks, each supporting above a 30 price to earnings (P/E) ratio, compared to just 10.4 for Berkshire and 9.1 for JPMorgan.
75% of the fund is concentrated in the technology, communications, and consumer discretionary sectors -- all of which tend to trade at premium valuations to the market. So it's no wonder the Vanguard Growth ETF has a 32.2 P/E ratio, a premium valuation relative to the 21.2 P/E ratio of the Vanguard S&P 500 ETF.
The concentration on growth instead of value unsurprisingly results in a lower dividend yield, just 0.6% for the Vanguard Growth ETF compared to 1.6% for the Vanguard S&P 500 ETF.
The theme of the ETF is to invest in companies that are going to devote their cash flows to growing their businesses and improving operations, not paying dividends. The inherent risk with this approach, and the allocation of the ETF, makes it more volatile than the S&P 500 and more sensitive to the economic cycle. This is fine if you're an investor with a long-term time horizon, but it's not attractive if you're looking for companies that are good values and pay dividends.
Checks and balances
The Vanguard Growth ETF is a balanced and low-cost way for someone to buy the Magnificent Seven. Instead of investing $1,000 in the Magnificent Seven, $1,000 invested in the Vanguard Growth ETF is basically putting half of that in the Magnificent Seven and then the other half in a boatload of other top companies. And to top it all off, a $1,000 investment in the Vanguard Growth ETF would incur a mere 40 cent annual expense thanks to the fund's minuscule 0.04% expense ratio.
One of the biggest mistakes investors make is accidentally overly allocating into a single stock or type of stock. The Vanguard Growth ETF is a way of making sure that doesn't happen, while also being an incredibly bullish bet on the growth of the stock market. After all, this is an ETF that is up just shy of 40% YTD. So it has the potential to produce some serious returns. But it also ensures that an investment remains diversified.
The best way to invest in the Magnificent Seven
The Vanguard Growth ETF has had an incredible year. For the ETF to keep outperforming the major indexes, the Magnificent Seven are going to have to continue beating the market.
No one knows if that will happen in the short term. But over the long term, the Magnificent Seven open the door to a lot of exciting trends and paradigm-shifting technologies. The Vanguard Growth ETF provides a responsible and measured way to invest in the Magnificent Seven without compromising upside potential.
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Bank of America is an advertising partner of The Ascent, a Motley Fool company. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Daniel Foelber has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Bank of America, Berkshire Hathaway, JPMorgan Chase, Mastercard, Meta Platforms, Nvidia, Tesla, Vanguard Index Funds-Vanguard Growth ETF, Vanguard S&P 500 ETF, and Visa. The Motley Fool recommends the following options: long January 2025 $370 calls on Mastercard and short January 2025 $380 calls on Mastercard. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The term, coined by Bank of America analyst Michael Hartnett, is used to describe Apple (NASDAQ: AAPL), Microsoft (NASDAQ: AAPL), Alphabet (NASDAQ: GOOG)(NASDAQ: GOOGL), Amazon (NASDAQ: AMZN), Nvidia (NASDAQ: NVDA), Meta Platforms (NASDAQ: META), and Tesla (NASDAQ: TSLA). AAPL data by YCharts A focus on growth instead of value and income If you're interested in the Magnificent Seven, chances are you are interested in growth and dominant industry-leading companies, and are willing to pay a premium price for a stock relative to the market. But Visa and Mastercard are on the growth side of the financial spectrum, more so than Berkshire's property and casualty insurance business or a diversified bank like JPMorgan. | The term, coined by Bank of America analyst Michael Hartnett, is used to describe Apple (NASDAQ: AAPL), Microsoft (NASDAQ: AAPL), Alphabet (NASDAQ: GOOG)(NASDAQ: GOOGL), Amazon (NASDAQ: AMZN), Nvidia (NASDAQ: NVDA), Meta Platforms (NASDAQ: META), and Tesla (NASDAQ: TSLA). AAPL data by YCharts A focus on growth instead of value and income If you're interested in the Magnificent Seven, chances are you are interested in growth and dominant industry-leading companies, and are willing to pay a premium price for a stock relative to the market. Apple 13% 7.09% Microsoft 12.88% 7.1% Alphabet 6.94% 3.87% Amazon 6.33% 3.42% Nvidia 4.9% 2.85% Meta Platforms 3.43% 1.89% Tesla 2.78% 1.57% Total 50.26% 27.79% Data Source: Vanguard. | The term, coined by Bank of America analyst Michael Hartnett, is used to describe Apple (NASDAQ: AAPL), Microsoft (NASDAQ: AAPL), Alphabet (NASDAQ: GOOG)(NASDAQ: GOOGL), Amazon (NASDAQ: AMZN), Nvidia (NASDAQ: NVDA), Meta Platforms (NASDAQ: META), and Tesla (NASDAQ: TSLA). AAPL data by YCharts A focus on growth instead of value and income If you're interested in the Magnificent Seven, chances are you are interested in growth and dominant industry-leading companies, and are willing to pay a premium price for a stock relative to the market. A magnificent year The Vanguard Growth ETF has nearly double its exposure to the Magnificent Seven as the Vanguard S&P 500 ETF (NYSEMKT: VOO), which is a near mirror image of the S&P 500. | The term, coined by Bank of America analyst Michael Hartnett, is used to describe Apple (NASDAQ: AAPL), Microsoft (NASDAQ: AAPL), Alphabet (NASDAQ: GOOG)(NASDAQ: GOOGL), Amazon (NASDAQ: AMZN), Nvidia (NASDAQ: NVDA), Meta Platforms (NASDAQ: META), and Tesla (NASDAQ: TSLA). AAPL data by YCharts A focus on growth instead of value and income If you're interested in the Magnificent Seven, chances are you are interested in growth and dominant industry-leading companies, and are willing to pay a premium price for a stock relative to the market. A magnificent year The Vanguard Growth ETF has nearly double its exposure to the Magnificent Seven as the Vanguard S&P 500 ETF (NYSEMKT: VOO), which is a near mirror image of the S&P 500. |
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12361.0 | 2023-11-28 00:00:00 UTC | Should Schwab Fundamental U.S. Large Company Index ETF (FNDX) Be on Your Investing Radar? | AAPL | https://www.nasdaq.com/articles/should-schwab-fundamental-u.s.-large-company-index-etf-fndx-be-on-your-investing-radar-11 | Looking for broad exposure to the Large Cap Value segment of the US equity market? You should consider the Schwab Fundamental U.S. Large Company Index ETF (FNDX), a passively managed exchange traded fund launched on 08/13/2013.
The fund is sponsored by Charles Schwab. It has amassed assets over $12.37 billion, making it one of the larger ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
Companies that fall in the large cap category tend to have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Carrying lower than average price-to-earnings and price-to-book ratios, value stocks also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.25%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.90%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Information Technology sector--about 18.60% of the portfolio. Financials and Healthcare round out the top three.
Looking at individual holdings, Apple Inc (AAPL) accounts for about 4.49% of total assets, followed by Microsoft Corp (MSFT) and Berkshire Hathaway Inc Class B (BRK/B).
The top 10 holdings account for about 20.59% of total assets under management.
Performance and Risk
FNDX seeks to match the performance of the Russell RAFI US Large Co. Index before fees and expenses. The Russell RAFI US Large Company Index measures the performance of the large company size segment by fundamental overall company scores.
The ETF has gained about 10.97% so far this year and is up roughly 6.15% in the last one year (as of 11/28/2023). In the past 52-week period, it has traded between $52.49 and $59.78.
The ETF has a beta of 1.01 and standard deviation of 16.36% for the trailing three-year period, making it a medium risk choice in the space. With about 730 holdings, it effectively diversifies company-specific risk.
Alternatives
Schwab Fundamental U.S. Large Company Index ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, FNDX is a great option for investors seeking exposure to the Style Box - Large Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 1000 Value ETF (IWD) and the Vanguard Value ETF (VTV) track a similar index. While iShares Russell 1000 Value ETF has $50.60 billion in assets, Vanguard Value ETF has $99.95 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Looking at individual holdings, Apple Inc (AAPL) accounts for about 4.49% of total assets, followed by Microsoft Corp (MSFT) and Berkshire Hathaway Inc Class B (BRK/B). Click to get this free report Schwab Fundamental U.S. Large Company Index ETF (FNDX): ETF Research Reports Apple Inc. (AAPL) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report Vanguard Value ETF (VTV): ETF Research Reports iShares Russell 1000 Value ETF (IWD): ETF Research Reports To read this article on Zacks.com click here. You should consider the Schwab Fundamental U.S. Large Company Index ETF (FNDX), a passively managed exchange traded fund launched on 08/13/2013. | Click to get this free report Schwab Fundamental U.S. Large Company Index ETF (FNDX): ETF Research Reports Apple Inc. (AAPL) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report Vanguard Value ETF (VTV): ETF Research Reports iShares Russell 1000 Value ETF (IWD): ETF Research Reports To read this article on Zacks.com click here. Looking at individual holdings, Apple Inc (AAPL) accounts for about 4.49% of total assets, followed by Microsoft Corp (MSFT) and Berkshire Hathaway Inc Class B (BRK/B). You should consider the Schwab Fundamental U.S. Large Company Index ETF (FNDX), a passively managed exchange traded fund launched on 08/13/2013. | Click to get this free report Schwab Fundamental U.S. Large Company Index ETF (FNDX): ETF Research Reports Apple Inc. (AAPL) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report Vanguard Value ETF (VTV): ETF Research Reports iShares Russell 1000 Value ETF (IWD): ETF Research Reports To read this article on Zacks.com click here. Looking at individual holdings, Apple Inc (AAPL) accounts for about 4.49% of total assets, followed by Microsoft Corp (MSFT) and Berkshire Hathaway Inc Class B (BRK/B). Alternatives Schwab Fundamental U.S. Large Company Index ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. | Looking at individual holdings, Apple Inc (AAPL) accounts for about 4.49% of total assets, followed by Microsoft Corp (MSFT) and Berkshire Hathaway Inc Class B (BRK/B). Click to get this free report Schwab Fundamental U.S. Large Company Index ETF (FNDX): ETF Research Reports Apple Inc. (AAPL) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report Vanguard Value ETF (VTV): ETF Research Reports iShares Russell 1000 Value ETF (IWD): ETF Research Reports To read this article on Zacks.com click here. You should consider the Schwab Fundamental U.S. Large Company Index ETF (FNDX), a passively managed exchange traded fund launched on 08/13/2013. |
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12375.0 | 2023-11-27 00:00:00 UTC | How Long Can Wall Street Overlook This Breakout Penny Stock? | AAPL | https://www.nasdaq.com/articles/how-long-can-wall-street-overlook-this-breakout-penny-stock | Investing in penny stocks is a high-risk, high-reward proposition. Generally, stocks with share prices below $5 are defined as penny stocks. For investors with a higher risk appetite who like a bargain, investing in cheap penny stocks can be a tempting way to speculate on potentially outsized returns.
In fact, shares of several big tech companies, including Apple (AAPL) and Amazon (AMZN), were priced below $5 when they first went public on the stock market. That said, penny stocks have also gained a reputation for burning significant investor wealth.
Keeping these factors in mind, let’s see if it makes sense to invest in breakout penny stock Safety Shot (SHOT) right now.
www.barchart.com
An Overview of Safety Shot
Valued at $99.6 million by market cap, Safety Shot is the first patented beverage globally that reduces blood alcohol content (BAC) and boosts clarity. A wellness and functional beverage company, Safety Shot is engaged in the research and development of OTC (over-the-counter) products and intellectual property.
Its product pipeline includes:
Photocil - To address psoriasis and vertigo
JW-700 - To treat hair loss
JW-500 - A woman-oriented sexual wellness product
NoStingz - A jellyfish sting prevention sunscreen
JW-110 - To treat atopic eczema
Previously known as Jupiter Wellness, Safety Shot sells its products through third-party retail stores and channel partners. It also aims to unlock value through the spin-out of its legacy assets from Jupiter Wellness.
In the last 12 months, Safety Shot has reported revenue of $6.83 million with a gross profit of $1.36 million and an operating loss of $11.2 million.
Short Sellers Target SHOT
Shares of Safety Shot have surged over 400% year-to-date, but recently came under pressure after a report from short sellers Capybara Research. In response, Safety Shot released a press statement accusing short sellers of publishing “malicious, defamatory, inaccurate articles” about Safety Shot and its management, forcing investors out of their holdings so they could buy shares at a lower cost and cover short positions.
By the numbers, there are 1.8 million SHOT shares sold short, as of the Oct. 31 reporting period. At the stock's average daily trading volume, it would take more than three days to cover these shorted shares.
A Billion-Dollar Market Opportunity
Safety Shot expects to launch its patented beverage in December 2023 by marketing the product on Amazon. The company has forecast the functional beverage market at $62 billion and aims to gain market share here.
SHOT estimates the hangover remedies market at $1.56 billion, which is expected to grow by 14.6% annually through 2028. Soon after its launch on Amazon, SHOT plans to focus on B2B (business-to-business) sales of its products to distributors, retailers, bars, and restaurants in Q1 of 2024. It seems SHOT is just weeks away from a potential liftoff in revenue growth.
Meanwhile, despite the massive breakout in the share price, there are no analysts offering coverage of Safety Shot. While SHOT is best reserved for those with robust risk appetites for now, any new ratings or legitimate analyst attention from Wall Street could potentially draw some new buyers to the wellness-focused penny stock in the near term.
On the date of publication, Aditya Raghunath did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | In fact, shares of several big tech companies, including Apple (AAPL) and Amazon (AMZN), were priced below $5 when they first went public on the stock market. For investors with a higher risk appetite who like a bargain, investing in cheap penny stocks can be a tempting way to speculate on potentially outsized returns. While SHOT is best reserved for those with robust risk appetites for now, any new ratings or legitimate analyst attention from Wall Street could potentially draw some new buyers to the wellness-focused penny stock in the near term. | In fact, shares of several big tech companies, including Apple (AAPL) and Amazon (AMZN), were priced below $5 when they first went public on the stock market. Keeping these factors in mind, let’s see if it makes sense to invest in breakout penny stock Safety Shot (SHOT) right now. A Billion-Dollar Market Opportunity Safety Shot expects to launch its patented beverage in December 2023 by marketing the product on Amazon. | In fact, shares of several big tech companies, including Apple (AAPL) and Amazon (AMZN), were priced below $5 when they first went public on the stock market. www.barchart.com An Overview of Safety Shot Valued at $99.6 million by market cap, Safety Shot is the first patented beverage globally that reduces blood alcohol content (BAC) and boosts clarity. Short Sellers Target SHOT Shares of Safety Shot have surged over 400% year-to-date, but recently came under pressure after a report from short sellers Capybara Research. | In fact, shares of several big tech companies, including Apple (AAPL) and Amazon (AMZN), were priced below $5 when they first went public on the stock market. Generally, stocks with share prices below $5 are defined as penny stocks. A Billion-Dollar Market Opportunity Safety Shot expects to launch its patented beverage in December 2023 by marketing the product on Amazon. |
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12383.0 | 2023-11-26 00:00:00 UTC | Guru Fundamental Report for AAPL | AAPL | https://www.nasdaq.com/articles/guru-fundamental-report-for-aapl-22 | Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. This momentum model looks for a combination of fundamental momentum and price momentum.
APPLE INC (AAPL) is a large-cap growth stock in the Communications Equipment industry. The rating using this strategy is 94% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
FUNDAMENTAL MOMENTUM: PASS
TWELVE MINUS ONE MOMENTUM: PASS
FINAL RANK: PASS
Detailed Analysis of APPLE INC
AAPL Guru Analysis
AAPL Fundamental Analysis
More Information on Dashan Huang
Dashan Huang Portfolio
About Dashan Huang: Dashan Huang is an Assistant Professor of Finance at the Lee Kong Chian School of Business at Singapore Management University. His paper "Twin Momentum" looked at combining traditional price momentum with improving fundamentals to generate market outperformance. In the paper, he identified seven fundamental variables (earnings, return on equity, return on assets, accrual operating profitability to equity, cash operating profitability to assets, gross profit to assets and net payout ratio) that he combined into a single fundamental momentum measure. He showed that stocks in the top 20% of the universe according to that measure outperformed the market going forward. When he combined that measure with price momentum, he was able to double its outperformance.
Additional Research Links
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About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | APPLE INC (AAPL) is a large-cap growth stock in the Communications Equipment industry. Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. | Detailed Analysis of APPLE INC AAPL Guru Analysis AAPL Fundamental Analysis More Information on Dashan Huang Dashan Huang Portfolio About Dashan Huang: Dashan Huang is an Assistant Professor of Finance at the Lee Kong Chian School of Business at Singapore Management University. Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. | Detailed Analysis of APPLE INC AAPL Guru Analysis AAPL Fundamental Analysis More Information on Dashan Huang Dashan Huang Portfolio About Dashan Huang: Dashan Huang is an Assistant Professor of Finance at the Lee Kong Chian School of Business at Singapore Management University. Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. | Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. Below is Validea's guru fundamental report for APPLE INC (AAPL). APPLE INC (AAPL) is a large-cap growth stock in the Communications Equipment industry. |
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12385.0 | 2023-11-25 00:00:00 UTC | Warren Buffett-Led Berkshire Hathaway Sells Its Entire Procter & Gamble Stake. Should You? | AAPL | https://www.nasdaq.com/articles/warren-buffett-led-berkshire-hathaway-sells-its-entire-procter-gamble-stake.-should-you | Berkshire Hathaway's (NYSE: BRK.A) (NYSE: BRK.B) latest 13F filing revealed that the company sold $7 billion in equities in Q3 -- including its entire stake in Procter & Gamble (NYSE: PG).
P&G has a wide moat, a stable business, and generates a ton of cash. Plus, it's a Dividend King with 67 consecutive years of dividend payments. It sounds like the perfect Buffett stock. But apparently it wasn't.
Let's go through some of the reasons why Berkshire may have sold P&G, but why the company could still be worth buying now.
Image source: Getty Images.
A bit of housekeeping
Berkshire finished Q2 with 315,400 shares of P&G -- valued at $47.9 million. It sounds like a lot, but the position was less than 0.1% of Berkshire's portfolio.
According to its Q3 13F filing, Berkshire has completely exited the position.
The sale may have just been an effort to consolidate the portfolio a bit. After all, Berkshire also exited other smaller positions, including Johnson & Johnson, Mondelez, United Parcel Service, Celanese, and General Motors. Aside from Celanese and GM, which both made up 0.2% of the public equity portfolio, all the other positions made up less than 0.1%.
A premium valuation
There's a good chance Buffett and his team sold these small holdings simply to consolidate the portfolio. But a better question to ask is why didn't Berkshire buy more P&G in the past or make it a larger position?
The answer may simply come down to valuation. P&G sports a price-to-earnings (P/E) ratio of 24.33, right around the P/E of the S&P 500, which is 24.6. It also has a high price-to-free cash flow (FCF) ratio of 25.5.
PG PE Ratio data by YCharts
And it's not like P&G's P/E ratio of price-to-FCF has been low in the past. Its 10-year median levels are above the market average, which is rare for a low-growth, stodgy dividend stock.
By comparison, Apple (NASDAQ: AAPL) stock, which has pole-vaulted to 50% of Berkshire's public equity portfolio, was a reasonable valuation for a while. Apple sports a 31.3 P/E ratio today, which may be one of the reasons Berkshire has been holding, not buying Apple. But its 10-year median P/E ratio is 18.
Aside from preferring Apple over other stocks, Berkshire also continues buying back its own stock. Berkshire is known for its public equity holdings. But it has sizable investments in many other companies too, from insurance, finance, energy, utilities, infrastructure, and more.
All told, Berkshire's reasons for not buying more P&G in years past, and its decision to sell the position today, may come down to Buffett and his team preferring other opportunities, including Apple and its own stock.
Why P&G is worth owning
An expensive valuation is far and away the best case against P&G. But it's important to also recognize what P&G does well and why it may be worth a premium price.
At its core, P&G's success stems from its ability to develop brands, as well as to recognize what brands aren't worth developing.
P&G is a cash cow that has proven to have immense pricing power even during this inflationary environment. It has successfully raised prices quarter after quarter. Instead of choosing a less expensive comparable generic brand, the numbers show that consumers are accepting P&G's price hikes. This shows that even in the consumer staples industry, there is an element of brand and pricing power that can give a company like P&G a lever to pull to offset high inflation.
Instead of using its FCF to overly invest in its business, P&G remains disciplined and chooses instead to return the majority of profits to investors through dividends and stock buybacks. In fiscal 2023, P&G spent a staggering $9 billion on dividends and $7.4 billion on buybacks. Over the last 10 years, it has reduced its outstanding share count by 13.1%.
By reducing the share count, buybacks permanently boost earnings per share since there are fewer shares to go around. It's a way for a company to grow its earnings per share in addition to organic growth, which makes a lot of sense for P&G since it is a low-growth company with limited outlets for responsible capital investment.
P&G is a perfect stock for risk-averse investors
P&G's positioning, track record for brand development, recession resilience, and pricing power make it a great company. In addition to those factors, what makes P&G a very good stock is its commitment to shareholders through the dividends and buybacks.
In Berkshire's case, buying back its own stock is perfectly reasonable because it is confident in the strength and valuation of its businesses. But for individual investors, about the only thing not to like about P&G is its valuation. The company checks the rest of the boxes.
P&G remains an excellent choice for folks looking to supplement income in retirement or who are looking for a safe stock so that they can participate in the stock market and collect dividend income, but also reduce the impact that a recession or major sell-off would likely have on their portfolio.
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Daniel Foelber has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple and Berkshire Hathaway. The Motley Fool recommends General Motors, Johnson & Johnson, and United Parcel Service and recommends the following options: long January 2025 $25 calls on General Motors. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | By comparison, Apple (NASDAQ: AAPL) stock, which has pole-vaulted to 50% of Berkshire's public equity portfolio, was a reasonable valuation for a while. All told, Berkshire's reasons for not buying more P&G in years past, and its decision to sell the position today, may come down to Buffett and his team preferring other opportunities, including Apple and its own stock. This shows that even in the consumer staples industry, there is an element of brand and pricing power that can give a company like P&G a lever to pull to offset high inflation. | By comparison, Apple (NASDAQ: AAPL) stock, which has pole-vaulted to 50% of Berkshire's public equity portfolio, was a reasonable valuation for a while. Berkshire Hathaway's (NYSE: BRK.A) (NYSE: BRK.B) latest 13F filing revealed that the company sold $7 billion in equities in Q3 -- including its entire stake in Procter & Gamble (NYSE: PG). After all, Berkshire also exited other smaller positions, including Johnson & Johnson, Mondelez, United Parcel Service, Celanese, and General Motors. | By comparison, Apple (NASDAQ: AAPL) stock, which has pole-vaulted to 50% of Berkshire's public equity portfolio, was a reasonable valuation for a while. Aside from preferring Apple over other stocks, Berkshire also continues buying back its own stock. All told, Berkshire's reasons for not buying more P&G in years past, and its decision to sell the position today, may come down to Buffett and his team preferring other opportunities, including Apple and its own stock. | By comparison, Apple (NASDAQ: AAPL) stock, which has pole-vaulted to 50% of Berkshire's public equity portfolio, was a reasonable valuation for a while. Let's go through some of the reasons why Berkshire may have sold P&G, but why the company could still be worth buying now. But a better question to ask is why didn't Berkshire buy more P&G in the past or make it a larger position? |
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12404.0 | 2023-11-24 00:00:00 UTC | EXPLAINER-What deals can shoppers find this Black Friday? | AAPL | https://www.nasdaq.com/articles/explainer-what-deals-can-shoppers-find-this-black-friday | By Juveria Tabassum, Savyata Mishra
Nov 16 (Reuters) - Retailers are preparing for what they hope will be yet another record-setting global shopping spree on Black Friday, the fourth Friday of November, which this year is Nov. 24.
Known for crowds lining up at big-box stores to pounce on doorbuster discounts during the early hours after American Thanksgiving, Black Friday normally marks the unofficial start of the Christmas shopping season.
Retailers in the U.S., Europe and elsewhere will be trying to cash in on the hoopla. Here is what to expect from Black Friday 2023.
WHY IS IT CALLED 'BLACK' FRIDAY?
Starting around the 1960s and early 1970s, police and bus drivers in Philadelphia used the term "Black Friday" to refer to the chaos an influx of people to the city created before the Thanksgiving weekend. Visitors would trawl the stores in Philadelphia on Friday with their Christmas lists looking for gifts. Shoplifting and parking violations ensued.
Department stores re-branded the term to "Big Friday" to put a more positive spin on it. But the name did not stick, and since the 1980s retailers began to describe Black Friday as the day when their retail ledgers are allegedly "in the black," or operating at a profit, as customers start holiday shopping, according to Marcus Collins, a marketing professor with Ross School of Business, University of Michigan.
"What we know is Black Friday, because it's so ceremonial, we get more people participating in it," Collins said.
WILL SHOPPERS FIND BLACK FRIDAY DEALS THIS YEAR?
Several major retailers from Dollar General DG.N to Walmart WMT.N and Macy's M.N could be saddled with too much stock for a second straight year, according to a Reuters analysis. They likely will need to offer discounts in order to drive shoppers to their stores and websites.
Even ahead of Black Friday, research firm Jane Hali & Associates said discounts at Kohl's KSS.N and Macy's were as high as 60%, with foot traffic lower at these two retailers and Nordstrom JWN.N compared to last year.
Online discounts were expected to be as steep as 35% on toys, 24% on sporting goods and 19% on furniture, according to data from Adobe Analytics.
WHAT ITEMS ARE HOT FOR BLACK FRIDAY THIS YEAR?
IPhones will be hot again, with the recent launch of the iPhone 15. Last year, shoppers looking for Apple's AAPL.O iPhone 14 Pro and iPhone 14 Pro Max returned empty handed as the technology company struggled with production snafus in China.
Electronics are expected to be the top pick this shopping season, with estimates of a 6% growth, according to a report by Mastercard.
Best Buy kicked off its Black Friday deals in late October with offers such as its Play Station 5 for $499.99 bundled with either "Call of Duty: Modern Warfare III" or Marvel's "Spider-Man 2", though the retailer on Tuesday forecast a bigger decline in annual comparable sales and pointed to "difficult to predict" consumer demand.
Skin and hair care products remain popular, with Ulta Beauty offering up to 40% discount on CoverGirl and Lancome mascaras, Bobbi Brown concealers and select products of its own label.
ARE BLACK FRIDAY CROWDS LIKELY THIS YEAR?
Around 130.7 million people are planning to shop on Black Friday this year, according to data from the National Retail Federation (NRF). Thanksgiving weekend, which encompasses Black Friday and Cyber Monday - the Monday after Thanksgiving - is typically the busiest shopping period in the United States.
But Dana Telsey, CEO of Telsey Advisory Group, said Black Friday itself will not be as important this year. With Christmas falling on a Monday, the "procrastination factor (is) even greater because shoppers can wait until Saturday or Sunday" before Christmas to get gifts, she said this week.
Throughout the holiday season, in-store traffic is expected to fall slightly this year, dropping by 3.5% compared to last year, according to retail analytics firm Sensormatic Solutions.
Wet weather, which deterred in-store traffic in some parts of the U.S. last year on Black Friday morning, is largely not expected this year, according AccuWeather.
Although most U.S. stores will be closed on Thanksgiving again this year, opening for shoppers at 5 a.m. or 6 a.m. on Friday, some retailers are advertising discounts online that kick in starting at 12:01 a.m. on Thanksgiving.
Among them is Kohl's, which is promoting what it calls a "Super Deal" on Thanksgiving and Black Friday on products including Beats Studio Buds wireless noise cancelling earbuds for $89.99, from the regular price of $149.99.
Retailers big and small are touting online ordering and curbside pick-up this year for the convenience of shoppers who want to avoid stores. In the past decade, Americans' Black Friday purchases online have more than tripled, reaching $9.12 billion on the day last year, according to Adobe.
WHAT ARE RETAILERS' PLANS THIS YEAR?
Retailers including Best Buy, Macy's, H&M and pure e-commerce retailers like Shein and Temu were touting early Black Friday "deals" of up to 30% off on some limited merchandise online and in stores.
Such early promotions could help them measure shopper demand and avoid product shortages, which could be a big problem this year. Water levels in a key shipping artery, the Panama Canal, have dropped due to a severe drought, cutting the number of ships carrying merchandise through it.
Many retailers in the U.S. intentionally muted their holiday hiring plans. Labor shortages are also a challenge for retailers in Europe, meaning shoppers could find fewer staff to help them.
ARE DISRUPTIONS EXPECTED DURING THANKSGIVING WEEKEND?
More than 400 Macy's workers in Washington state are planning a three-day strike from Black Friday through Sunday, alleging unfair labor practices and demanding better wages, according to UFCW Local 3000's website.
Amazon workers in more than a dozen U.S. warehouses are striking on Black Friday, in a fight for higher wages, improved environmental efforts and tax payments to Europe. Protests are slated in more than 30 countries, including Germany, India and Spain, where at least 30 facilities will see walk-outs.
The strike's organizer Make Amazon Pay expects "thousands of workers" to participate with the hopes of causing friction to the e-retail giant's supply chain, which sees peak demand during the holiday shopping season. "Tens of thousands" of workers participated in three previous Amazon Black Friday walk-outs.
HOW MUCH ARE SHOPPERS EXPECTED TO SPEND?
Retail sales during the holidays are expected to be up 3% to 4% year-over-year across all sales channels - online, click and collect and in-store purchases, according to David Bujnicki, senior vice president of investor relations and strategy at Kimco Realty Corp KIM.N, an owner of open-air shopping centers. As of Sept. 30, Kimco owned interests in 527 U.S. shopping centers and mixed-use assets.
"Black Friday, while still a very important retail shopping day, is no longer the make or break benchmark," he said. "Retailers and consumers are spreading out their holiday sales deals beginning in November."
Spending online during Black Friday is expected to rise 5.7% to roughly $9.6 billion, according to Adobe.
In the United Kingdom, online spending during Black Friday is expected to rise 4.5% to 1.05 billion pounds ($1.30 billion), with total sales over the Cyber Weekend reaching 3.8 billion pounds, according to an Adobe forecast.
WHAT ARE RETAILERS DOING TO ATTRACT HOLIDAY SHOPPERS?
With student loan payments returning, and costs of housing and essentials pinching household budgets, analysts believe retailers will have to rely on promotions and early offers to stay afloat this holiday season.
Consumers were looking to make the most of promotional events and wrap up their shopping in just 5.8 weeks this year, when compared to a 7.4-week window pre-pandemic, according to data from Deloitte.
WHAT ARE RETAILERS SAYING ABOUT THIS YEAR'S BLACK FRIDAY?
Macy's CEO Jeff Gennette on Thursday said the competitive landscape has shifted to Black Friday deals prior to Black Friday. "We're in the midst of that along with our competitors, customers are taking advantage of that."
Mattel President Steve Totzke told Reuters on Monday that he is expecting a strong Black Friday and run-up to the holidays even as the toymaker warned of slowing demand for the toy industry last month.
($1 = 0.8048 pounds)
(Reporting by Juveria Tabassum and Savyata Mishra in Bengaluru, Richa Naidu in London, additional reporting by Helen Reid in London and Herbert Lash; Editing by Josie Kao)
(([email protected];))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Last year, shoppers looking for Apple's AAPL.O iPhone 14 Pro and iPhone 14 Pro Max returned empty handed as the technology company struggled with production snafus in China. Best Buy kicked off its Black Friday deals in late October with offers such as its Play Station 5 for $499.99 bundled with either "Call of Duty: Modern Warfare III" or Marvel's "Spider-Man 2", though the retailer on Tuesday forecast a bigger decline in annual comparable sales and pointed to "difficult to predict" consumer demand. The strike's organizer Make Amazon Pay expects "thousands of workers" to participate with the hopes of causing friction to the e-retail giant's supply chain, which sees peak demand during the holiday shopping season. | Last year, shoppers looking for Apple's AAPL.O iPhone 14 Pro and iPhone 14 Pro Max returned empty handed as the technology company struggled with production snafus in China. Throughout the holiday season, in-store traffic is expected to fall slightly this year, dropping by 3.5% compared to last year, according to retail analytics firm Sensormatic Solutions. More than 400 Macy's workers in Washington state are planning a three-day strike from Black Friday through Sunday, alleging unfair labor practices and demanding better wages, according to UFCW Local 3000's website. | Last year, shoppers looking for Apple's AAPL.O iPhone 14 Pro and iPhone 14 Pro Max returned empty handed as the technology company struggled with production snafus in China. By Juveria Tabassum, Savyata Mishra Nov 16 (Reuters) - Retailers are preparing for what they hope will be yet another record-setting global shopping spree on Black Friday, the fourth Friday of November, which this year is Nov. 24. But the name did not stick, and since the 1980s retailers began to describe Black Friday as the day when their retail ledgers are allegedly "in the black," or operating at a profit, as customers start holiday shopping, according to Marcus Collins, a marketing professor with Ross School of Business, University of Michigan. | Last year, shoppers looking for Apple's AAPL.O iPhone 14 Pro and iPhone 14 Pro Max returned empty handed as the technology company struggled with production snafus in China. Here is what to expect from Black Friday 2023. Retailers big and small are touting online ordering and curbside pick-up this year for the convenience of shoppers who want to avoid stores. |
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12413.0 | 2023-11-23 00:00:00 UTC | From Energy to Retail: The Next 3 Trillion-Dollar Stocks | AAPL | https://www.nasdaq.com/articles/from-energy-to-retail%3A-the-next-3-trillion-dollar-stocks | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
It used to be a company being valued at $1 trillion was a big deal. When Apple (NASDAQ:AAPL) became the first company to cross that threshold in 2018, there was a lot of hoopla surrounding the event. Today, it seems companies routinely earn trillion-dollar market caps.
Not really, but there are six companies as of this writing that have valuations exceeding $1 trillion: Apple, Microsoft (NASDAQ:MSFT), Alphabet (NASDAQ:GOOG)(NASDAQ:GOOGL), Amazon (NASDAQ:AMZN), and the most recent one, Nvidia (NASDAQ:NVDA).
Some have achieved the distinction only to tumble afterward, namely Meta Platforms (NASDAQ:META) and Tesla (NASDAQ:TSLA). And certainly, others are within striking distance of entering this small club. What follows are three industry-leading stocks that have a good chance of becoming the next trillion-dollar stocks.
Berkshire Hathaway (BRK-A)(BRK-B)
Source: IgorGolovniov / Shutterstock.com
I’m not making any bold declarations when I say Berkshire Hathaway (NYSE:BRK-A)(NYSE:BRK-B) could be one of the first stocks to attain trillion-dollar status. It is already worth $789 billion. To ascend to those new heights in just five years would require Warren Buffett to generate returns of just 5% annually. Over the past five years, the Oracle of Omaha has done twice as well on average.
There are some risks to this eventuality. The main one is the advanced age of Buffett and his partner Charlie Munger. Both are nonagenarians and though we wish them all a continued long life, well, they’ve actually enjoyed that. Buffett understands this and has investment managers in place who will step in when he dies. In fact, they are making many investment decisions for Berkshire Hathaway today. What investors don’t know, though, is exactly which investments they’ve made so it’s difficult to gauge their performance. That could change the calculus of whether Berkshire can continue to grow as it has.
Berkshire Hathaway has $157 billion in cash which gives it quite a war chest to buy stocks opportunistically. Those purchases could have the stock grow even faster. It will also receive about $6 billion in dividend payments this year further juicing returns. It seems it’s only a matter of if, not when Berkshire becomes a $1 trillion stock.
Exxon Mobil (XOM)
Source: Jonathan Weiss / Shutterstock.com
Integrated oil and gas giant Exxon Mobil (NYSE:XOM) is the second stock with a good chance of gaining a trillion-dollar valuation. At a current valuation of $420 billion, it has a longer road to travel than Berkshire Hathaway, but there are strong tailwinds that should push it over the finish line.
For all the talk about renewable energy sources, fossil fuels remain the primary source of energy for the world. Demand is extraordinarily high such that renewables have little chance of meeting it for years to come if not decades. While Exxon Mobil has given a nod towards alternative energy, it is doubling down on fossil fuels.
Exxon just announced it was acquiring Pioneer Natural Resources (NYSE:PXD) for $60 billion in an all-stock deal. The oil company is the largest producer in the Permian basin while Exxon is the fifth largest. Combined, they will far outstrip any other producer, but by not so much as to trigger antitrust objections.
The merged companies could produce as much as 700,000 barrels per day of new oil and gas within four years. It will raise output to as high as 2 million barrels as well. The combination of Pioneer’s low-cost operations and Exxon’s technology could result in reduced greenhouse gas emissions and more oil per well produced.
Oil prices will likely remain high for some time further padding Exxon’s already burgeoning profit pool. That could push this oil giant up to a $1 trillion valuation sooner rather than later.
Walmart (WMT)
Source: Jonathan Weiss / Shutterstock.com
Retail king Walmart (NYSE:WMT) is in much the same boat as Exxon. It is currently valued at $418 billion, meaning it needs to more than double to grab the trillion-dollar brass ring. That’s no small feat as we’ve seen, but the world’s largest retailer can certainly pull it off.
Walmart delivered to investors a total return of 75% over the past five years or about 11% annually. It might take the retailer a few years longer to reach $1 trillion, but it’s doable. It delivered 4.4% U.S. sales growth in the third quarter and 10.8% internationally. E-commerce sales are growing smartly, too, up 24% domestically but down 3% elsewhere. The latter fell, though, because its Flipkart subsidiary pushed its Billion Dollar Days sales event into the fourth quarter from the third this year.
Profit margins should also improve over the next few years as it pushes greater automation in its fulfillment centers to increase efficiency and productivity. Walmart’s Spark Driver platform for home delivery is already achieving 15% cost reductions while shortening delivery times.
You have a traditional retailer transforming into one set up to meet the needs of tomorrow. And even though Walmart is a multinational multibillion dollar corporation, it is still surprisingly nimble. Where it is No. 1 in physical retail, it is only behind Amazon in e-commerce. Albeit a far ways back, but it is continually improving. It’s easy to see how it can reach a $1 trillion valuation over the next five to 10 years.
On the date of publication, Rich Duprey held a LONG position in XOM stock. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Rich Duprey has written about stocks and investing for the past 20 years. His articles have appeared on Nasdaq.com, The Motley Fool, and Yahoo! Finance, and he has been referenced by U.S. and international publications, including MarketWatch, Financial Times, Forbes, Fast Company, USA Today, Milwaukee Journal Sentinel, Cheddar News, The Boston Globe, L’Express, and numerous other news outlets.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | When Apple (NASDAQ:AAPL) became the first company to cross that threshold in 2018, there was a lot of hoopla surrounding the event. The combination of Pioneer’s low-cost operations and Exxon’s technology could result in reduced greenhouse gas emissions and more oil per well produced. More From InvestorPlace ChatGPT IPO Could Shock the World, Make This Move Before the Announcement Musk’s “Project Omega” May Be Set to Mint New Millionaires. | When Apple (NASDAQ:AAPL) became the first company to cross that threshold in 2018, there was a lot of hoopla surrounding the event. Berkshire Hathaway (BRK-A)(BRK-B) Source: IgorGolovniov / Shutterstock.com I’m not making any bold declarations when I say Berkshire Hathaway (NYSE:BRK-A)(NYSE:BRK-B) could be one of the first stocks to attain trillion-dollar status. Exxon Mobil (XOM) Source: Jonathan Weiss / Shutterstock.com Integrated oil and gas giant Exxon Mobil (NYSE:XOM) is the second stock with a good chance of gaining a trillion-dollar valuation. | When Apple (NASDAQ:AAPL) became the first company to cross that threshold in 2018, there was a lot of hoopla surrounding the event. Not really, but there are six companies as of this writing that have valuations exceeding $1 trillion: Apple, Microsoft (NASDAQ:MSFT), Alphabet (NASDAQ:GOOG)(NASDAQ:GOOGL), Amazon (NASDAQ:AMZN), and the most recent one, Nvidia (NASDAQ:NVDA). Berkshire Hathaway (BRK-A)(BRK-B) Source: IgorGolovniov / Shutterstock.com I’m not making any bold declarations when I say Berkshire Hathaway (NYSE:BRK-A)(NYSE:BRK-B) could be one of the first stocks to attain trillion-dollar status. | When Apple (NASDAQ:AAPL) became the first company to cross that threshold in 2018, there was a lot of hoopla surrounding the event. Exxon Mobil (XOM) Source: Jonathan Weiss / Shutterstock.com Integrated oil and gas giant Exxon Mobil (NYSE:XOM) is the second stock with a good chance of gaining a trillion-dollar valuation. Walmart delivered to investors a total return of 75% over the past five years or about 11% annually. |
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12427.0 | 2023-11-22 00:00:00 UTC | Should You Invest in the Vanguard Information Technology ETF (VGT)? | AAPL | https://www.nasdaq.com/articles/should-you-invest-in-the-vanguard-information-technology-etf-vgt-9 | Looking for broad exposure to the Technology - Broad segment of the equity market? You should consider the Vanguard Information Technology ETF (VGT), a passively managed exchange traded fund launched on 01/26/2004.
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Technology - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 5, placing it in top 31%.
Index Details
The fund is sponsored by Vanguard. It has amassed assets over $54.97 billion, making it the largest ETF attempting to match the performance of the Technology - Broad segment of the equity market. VGT seeks to match the performance of the MSCI US Investable Market Information Technology 25/50 Index before fees and expenses.
The MSCI US Investable Market Information Technology 25/50 Index is designed to transition in and out of securities affected by pending updates to the information technology sector.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.10%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 0.70%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Information Technology sector--about 100% of the portfolio.
Looking at individual holdings, Apple Inc. (AAPL) accounts for about 22.72% of total assets, followed by Microsoft Corp. (MSFT) and Nvidia Corp. (NVDA).
The top 10 holdings account for about 60.70% of total assets under management.
Performance and Risk
Year-to-date, the Vanguard Information Technology ETF return is roughly 44.30% so far, and was up about 38.01% over the last 12 months (as of 11/22/2023). VGT has traded between $311.10 and $462.42 in this past 52-week period.
The ETF has a beta of 1.15 and standard deviation of 25.16% for the trailing three-year period, making it a medium risk choice in the space. With about 325 holdings, it effectively diversifies company-specific risk.
Alternatives
Vanguard Information Technology ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, VGT is an outstanding option for investors seeking exposure to the Technology ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
IShares U.S. Technology ETF (IYW) tracks Dow Jones U.S. Technology Index and the Technology Select Sector SPDR ETF (XLK) tracks Technology Select Sector Index. IShares U.S. Technology ETF has $13.08 billion in assets, Technology Select Sector SPDR ETF has $54.51 billion. IYW has an expense ratio of 0.40% and XLK charges 0.10%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Vanguard Information Technology ETF (VGT): ETF Research Reports
Apple Inc. (AAPL) : Free Stock Analysis Report
Microsoft Corporation (MSFT) : Free Stock Analysis Report
NVIDIA Corporation (NVDA) : Free Stock Analysis Report
Technology Select Sector SPDR ETF (XLK): ETF Research Reports
iShares U.S. Technology ETF (IYW): ETF Research Reports
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Looking at individual holdings, Apple Inc. (AAPL) accounts for about 22.72% of total assets, followed by Microsoft Corp. (MSFT) and Nvidia Corp. (NVDA). Click to get this free report Vanguard Information Technology ETF (VGT): ETF Research Reports Apple Inc. (AAPL) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report NVIDIA Corporation (NVDA) : Free Stock Analysis Report Technology Select Sector SPDR ETF (XLK): ETF Research Reports iShares U.S. Technology ETF (IYW): ETF Research Reports To read this article on Zacks.com click here. Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. | Click to get this free report Vanguard Information Technology ETF (VGT): ETF Research Reports Apple Inc. (AAPL) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report NVIDIA Corporation (NVDA) : Free Stock Analysis Report Technology Select Sector SPDR ETF (XLK): ETF Research Reports iShares U.S. Technology ETF (IYW): ETF Research Reports To read this article on Zacks.com click here. Looking at individual holdings, Apple Inc. (AAPL) accounts for about 22.72% of total assets, followed by Microsoft Corp. (MSFT) and Nvidia Corp. (NVDA). IShares U.S. Technology ETF (IYW) tracks Dow Jones U.S. Technology Index and the Technology Select Sector SPDR ETF (XLK) tracks Technology Select Sector Index. | Click to get this free report Vanguard Information Technology ETF (VGT): ETF Research Reports Apple Inc. (AAPL) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report NVIDIA Corporation (NVDA) : Free Stock Analysis Report Technology Select Sector SPDR ETF (XLK): ETF Research Reports iShares U.S. Technology ETF (IYW): ETF Research Reports To read this article on Zacks.com click here. Looking at individual holdings, Apple Inc. (AAPL) accounts for about 22.72% of total assets, followed by Microsoft Corp. (MSFT) and Nvidia Corp. (NVDA). Alternatives Vanguard Information Technology ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. | Looking at individual holdings, Apple Inc. (AAPL) accounts for about 22.72% of total assets, followed by Microsoft Corp. (MSFT) and Nvidia Corp. (NVDA). Click to get this free report Vanguard Information Technology ETF (VGT): ETF Research Reports Apple Inc. (AAPL) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report NVIDIA Corporation (NVDA) : Free Stock Analysis Report Technology Select Sector SPDR ETF (XLK): ETF Research Reports iShares U.S. Technology ETF (IYW): ETF Research Reports To read this article on Zacks.com click here. You should consider the Vanguard Information Technology ETF (VGT), a passively managed exchange traded fund launched on 01/26/2004. |
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12435.0 | 2023-11-21 00:00:00 UTC | Apple (NASDAQ:AAPL): Boring, But Commands Massive Pricing Power | AAPL | https://www.nasdaq.com/articles/apple-nasdaq%3Aaapl%3A-boring-but-commands-massive-pricing-power | As one of the top consumer technology companies in the world, Apple (NASDAQ:AAPL) faces a distinct conundrum. Being a mature and established enterprise lends Apple to criticism that it’s boring. At the same time, pressure on the consumer economy implies a loss of relevance. Still, the company commands massive pricing power, making it a worthwhile investment to consider. I am bullish on AAPL stock for its resilience under pressure.
Breaking Down AAPL's Recent Results
For starters, Apple’s most recent earnings print for its fourth quarter of Fiscal 2023 provided a confidence boost for investors. Heading into the report, confidence was generally high. However, analysts pointed to concerns about weakness in the company’s hardware sales. That’s not surprising, given global demand worries – particularly in China – as well as supply constraint issues. Still, Apple delivered the goods like it usually does.
As TipRanks contributor Abdulrasaq Ariwoola reported, earnings per share landed at $1.46, beating the consensus target of $1.39 per share. On the top line, sales did happen to decrease 0.7% on a year-over-year basis to $89.46 billion. Nevertheless, this tally slightly exceeded analysts’ expectations, which called for $89.28 billion.
As for the hardware components, Apple’s iPhone sales rang up $43.81 billion, in line with Wall Street’s projections. In addition, this print represented a 2% lift from the year-ago quarter’s tally. Similarly, iPad revenue enjoyed an encouraging performance, reaching $6.44 billion, which beat the consensus view of $6.07 billion.
In fairness, it wasn’t all positive for AAPL stock. Sales related to Apple’s Mac computers slipped, coming out to $7.61 billion against an expected $8.63 billion. Further, to Ariwoola’s point, shares initially fell in after-hours trading following the earnings disclosure.
That could be due to options market dynamics. Both before and after the disclosure, options flow data showed bearish trades – both bought puts and sold calls – that may have impacted sentiment. Still, it appears that the power of the fundamentals has taken over the narrative.
Gross Margin Trend Confirms Apple’s Pricing Power
As impressive as the Fiscal Q4 print was for Apple, what could really drive AAPL stock higher for the long haul could be its pricing power. To be clear, no company is completely immune from outside pressures. For example, inflation remains stubbornly high. If the Federal Reserve wants to take the gloves off with aggressively higher interest rates, that could roil the economy.
Nevertheless, the company’s gross margin continues to march higher despite obvious headwinds impacting the consumer economy. In Fiscal Q4, Apple posted a gross margin of 45.2%. In the year-ago quarter, this metric sat at 42.3%. This is a strong indicator that, irrespective of increased prices, consumers will continue to buy Apple products. That bodes very well for AAPL stock.
Since Q4 of Fiscal 2020, when Apple’s gross margin landed at 38.2%, this metric has witnessed a dramatic surge higher. In a hyperbolic sense, the company enjoys the license to print money. Of course, as the Mac sales decline shows, Apple can’t afford to casually drop the ball. However, the fact that so many people continue to buy the firm's products in large quantities demonstrates practically unparalleled influence.
Let’s face it – there’s not much distinguishing one smart device brand from another these days. Nevertheless, Apple benefits from a social cachet that its rivals lack. Not even inflationary economic conditions can dent this market presence. That’s a huge positive for AAPL stock.
Not Cheap, but Effective
If one knock does exist about AAPL stock, it’s that the security trades at a high earnings premium. Right now, the market prices AAPL at about a trailing-year multiple of 31x. Generally speaking, Apple falls under the computer hardware sector, which runs a price/earnings ratio of 18.5x.
At the same time, the bullish argument for AAPL stock centers on the predictability of the earnings trajectory. Facing uncertain market conditions, business predictability should command a higher premium over enterprises that are merely cheap. Given Apple’s consistent strengths amid widespread pressure, that’s a premium worth absorbing.
Is AAPL Stock a Buy, According to Analysts?
Turning to Wall Street, AAPL stock has a Strong Buy consensus rating based on 25 Buys, eight Holds, and zero Sell ratings. The average AAPL stock price target is $201.99, implying 5.95% upside potential.
The Takeaway: AAPL Stock is Boring but Dependable
As an established player, no one should expect AAPL stock to be an exciting investment. However, for those concerned about the ambiguities of what may lie ahead in the new year, Apple brings a strong platform to the table. With the company consistently attracting consumer dollars despite significant headwinds, AAPL stock is worthy of consideration.
Disclosure
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | As one of the top consumer technology companies in the world, Apple (NASDAQ:AAPL) faces a distinct conundrum. I am bullish on AAPL stock for its resilience under pressure. Breaking Down AAPL's Recent Results For starters, Apple’s most recent earnings print for its fourth quarter of Fiscal 2023 provided a confidence boost for investors. | Turning to Wall Street, AAPL stock has a Strong Buy consensus rating based on 25 Buys, eight Holds, and zero Sell ratings. As one of the top consumer technology companies in the world, Apple (NASDAQ:AAPL) faces a distinct conundrum. I am bullish on AAPL stock for its resilience under pressure. | As one of the top consumer technology companies in the world, Apple (NASDAQ:AAPL) faces a distinct conundrum. Gross Margin Trend Confirms Apple’s Pricing Power As impressive as the Fiscal Q4 print was for Apple, what could really drive AAPL stock higher for the long haul could be its pricing power. The Takeaway: AAPL Stock is Boring but Dependable As an established player, no one should expect AAPL stock to be an exciting investment. | Gross Margin Trend Confirms Apple’s Pricing Power As impressive as the Fiscal Q4 print was for Apple, what could really drive AAPL stock higher for the long haul could be its pricing power. Is AAPL Stock a Buy, According to Analysts? As one of the top consumer technology companies in the world, Apple (NASDAQ:AAPL) faces a distinct conundrum. |
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12452.0 | 2023-11-20 00:00:00 UTC | Dow Analyst Moves: AAPL | AAPL | https://www.nasdaq.com/articles/dow-analyst-moves%3A-aapl-7 | The latest tally of analyst opinions from the major brokerage houses shows that among the 30 stocks making up the Dow Jones Industrial Average, Apple is the #12 analyst pick. Apple also comes in above the median of analyst picks among the broader S&P 500 index components, claiming the #149 spot out of 500.
Looking at the stock price movement year to date, Apple is showing a gain of 47.1%.
VIDEO: Dow Analyst Moves: AAPL
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | VIDEO: Dow Analyst Moves: AAPL The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. The latest tally of analyst opinions from the major brokerage houses shows that among the 30 stocks making up the Dow Jones Industrial Average, Apple is the #12 analyst pick. Apple also comes in above the median of analyst picks among the broader S&P 500 index components, claiming the #149 spot out of 500. | VIDEO: Dow Analyst Moves: AAPL The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. The latest tally of analyst opinions from the major brokerage houses shows that among the 30 stocks making up the Dow Jones Industrial Average, Apple is the #12 analyst pick. Apple also comes in above the median of analyst picks among the broader S&P 500 index components, claiming the #149 spot out of 500. | VIDEO: Dow Analyst Moves: AAPL The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. The latest tally of analyst opinions from the major brokerage houses shows that among the 30 stocks making up the Dow Jones Industrial Average, Apple is the #12 analyst pick. Apple also comes in above the median of analyst picks among the broader S&P 500 index components, claiming the #149 spot out of 500. | VIDEO: Dow Analyst Moves: AAPL The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. The latest tally of analyst opinions from the major brokerage houses shows that among the 30 stocks making up the Dow Jones Industrial Average, Apple is the #12 analyst pick. Apple also comes in above the median of analyst picks among the broader S&P 500 index components, claiming the #149 spot out of 500. |
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12456.0 | 2023-11-19 00:00:00 UTC | Guru Fundamental Report for AAPL | AAPL | https://www.nasdaq.com/articles/guru-fundamental-report-for-aapl-20 | Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. This momentum model looks for a combination of fundamental momentum and price momentum.
APPLE INC (AAPL) is a large-cap growth stock in the Communications Equipment industry. The rating using this strategy is 94% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
FUNDAMENTAL MOMENTUM: PASS
TWELVE MINUS ONE MOMENTUM: PASS
FINAL RANK: PASS
Detailed Analysis of APPLE INC
AAPL Guru Analysis
AAPL Fundamental Analysis
More Information on Dashan Huang
Dashan Huang Portfolio
About Dashan Huang: Dashan Huang is an Assistant Professor of Finance at the Lee Kong Chian School of Business at Singapore Management University. His paper "Twin Momentum" looked at combining traditional price momentum with improving fundamentals to generate market outperformance. In the paper, he identified seven fundamental variables (earnings, return on equity, return on assets, accrual operating profitability to equity, cash operating profitability to assets, gross profit to assets and net payout ratio) that he combined into a single fundamental momentum measure. He showed that stocks in the top 20% of the universe according to that measure outperformed the market going forward. When he combined that measure with price momentum, he was able to double its outperformance.
Additional Research Links
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About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | APPLE INC (AAPL) is a large-cap growth stock in the Communications Equipment industry. Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. | Detailed Analysis of APPLE INC AAPL Guru Analysis AAPL Fundamental Analysis More Information on Dashan Huang Dashan Huang Portfolio About Dashan Huang: Dashan Huang is an Assistant Professor of Finance at the Lee Kong Chian School of Business at Singapore Management University. Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. | Detailed Analysis of APPLE INC AAPL Guru Analysis AAPL Fundamental Analysis More Information on Dashan Huang Dashan Huang Portfolio About Dashan Huang: Dashan Huang is an Assistant Professor of Finance at the Lee Kong Chian School of Business at Singapore Management University. Below is Validea's guru fundamental report for APPLE INC (AAPL). Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. | Of the 22 guru strategies we follow, AAPL rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. Below is Validea's guru fundamental report for APPLE INC (AAPL). APPLE INC (AAPL) is a large-cap growth stock in the Communications Equipment industry. |
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12462.0 | 2023-11-18 00:00:00 UTC | Is Apple Stock a Buy Now? | AAPL | https://www.nasdaq.com/articles/is-apple-stock-a-buy-now-4 | Apple (NASDAQ: AAPL) is the largest company in the world -- worth nearly $3 trillion -- and many investors own a lot of its stock whether they know it or not. That's because Apple makes up 11.2% of the Nasdaq 100 and 7.3% of the S&P 500. If Apple doesn't do well, it will be a significant drag on these indexes, and investors across the board will see sub-par results.
On the flip side, if Apple does well, almost everyone else will, too. But here's the question: Is it worth buying additional shares of Apple if so many investors are already heavily weighted to it through their ownership of an index fund?
Apple's growth has been non-existent recently
Apple likely needs no introduction, as many in the U.S. already have an iPhone or a Mac computer. But what many people may not be aware of is Apple's service division, which generates revenue from the App Store, advertising, cloud services, and subscription products like Apple Music and Apple TV+. While some may consider this a necessary add-on, it has been a notable bright spot in Apple's fiscal 2023 (which ended Sept. 30).
CATEGORY FY 2023 REVENUE YOY GROWTH
iPhone $200.6 billion (2.4%)
Mac $29.4 billion (26.9%)
iPad $28.3 Billion (3.4%)
Wearables, Home and Accessories $39.8 billion (3.4%)
Services $85.2 billion 9.1%
Data source: Apple. YOY = year-over-year.
While iPhone sales were disappointing across the board in Apple's fiscal 2023, the fourth quarter brought a trend reversal. iPhone sales grew 2.8% year over year. While services revenue is vital, what drives Apple is the iPhone, and Apple investors need this product to sell well to do well.
Even though iPhone sales grew, that's not meaningful growth compared to other tech giants which posted revenue growth above 10%. However, revenue growth isn't everything. Profits also need to be considered, and Apple management has skillfully grown these even though revenue has declined slightly year over year.
For fiscal 2023, Apple's net income $97 billion was nearly the same as the $99.8 billion it earned a year earlier. But because of Apple's $78 billion in stock buybacks over the past year , Apple's earnings per share (EPS) for fiscal 2023 came in $0.01 higher than last year's at $6.16.
This trend of Apple's net income falling from last year reversed in Q4, as Apple's cost of sales dropped, increasing its margins and improving the bottom line. This helped increase Apple's EPS from $1.29 to $1.47, a 14% rise.
With Apple's earnings growing quickly, it weakens the bear argument. But there is still one more item to address before you buy Apple stock.
The stock fetches a premium price
There is only so much juice to squeeze from the margins before Apple hits a roadblock. It needs to return to growing its revenue in fiscal 2024 for the investment to make sense. Right now, investors have to pay a significant premium to own Apple shares, despite its lack of revenue growth.
AAPL PE Ratio data by YCharts
Normally, 30 times earnings would indicate that a stock is growing much faster than the market, but with Wall Street analysts expecting 6% revenue growth in fiscal 2024, it's not looking great for the stock.
As a result, I don't think investors should be loading up on Apple stock right now. The company doesn't offer a value proposition compared to other tech giants with its premium price tag and slow growth. If Apple can return to growing its sales at a 10% or greater pace, I may reconsider my stance.
But with a money-pinched consumer and lack of ground-breaking innovation from iPhones, this seems like a tall task for the world's largest company.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Apple (NASDAQ: AAPL) is the largest company in the world -- worth nearly $3 trillion -- and many investors own a lot of its stock whether they know it or not. AAPL PE Ratio data by YCharts Normally, 30 times earnings would indicate that a stock is growing much faster than the market, but with Wall Street analysts expecting 6% revenue growth in fiscal 2024, it's not looking great for the stock. But here's the question: Is it worth buying additional shares of Apple if so many investors are already heavily weighted to it through their ownership of an index fund? | Apple (NASDAQ: AAPL) is the largest company in the world -- worth nearly $3 trillion -- and many investors own a lot of its stock whether they know it or not. AAPL PE Ratio data by YCharts Normally, 30 times earnings would indicate that a stock is growing much faster than the market, but with Wall Street analysts expecting 6% revenue growth in fiscal 2024, it's not looking great for the stock. Even though iPhone sales grew, that's not meaningful growth compared to other tech giants which posted revenue growth above 10%. | Apple (NASDAQ: AAPL) is the largest company in the world -- worth nearly $3 trillion -- and many investors own a lot of its stock whether they know it or not. AAPL PE Ratio data by YCharts Normally, 30 times earnings would indicate that a stock is growing much faster than the market, but with Wall Street analysts expecting 6% revenue growth in fiscal 2024, it's not looking great for the stock. But what many people may not be aware of is Apple's service division, which generates revenue from the App Store, advertising, cloud services, and subscription products like Apple Music and Apple TV+. | Apple (NASDAQ: AAPL) is the largest company in the world -- worth nearly $3 trillion -- and many investors own a lot of its stock whether they know it or not. AAPL PE Ratio data by YCharts Normally, 30 times earnings would indicate that a stock is growing much faster than the market, but with Wall Street analysts expecting 6% revenue growth in fiscal 2024, it's not looking great for the stock. However, revenue growth isn't everything. |
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