The Apple Maven would like to welcome you all to 2021! I hope the new year will be a great one for everyone, especially Apple investors.
A look around reveals that many top experts remain very bullish on Apple. Below is a summary of what some of them have to say about the Cupertino company’s stock for the next 12 months.
Loup Ventures: top FAANG stock
Venture capital firm Loup Venture says that Apple should be the top performing of the FAANG stocks (“N” is for either Netflix or NVIDIA, rather than “M” for Microsoft) in 2021.
The company notes that fiscal 2022 revenue growth, which is currently expected to be only 5%, should exceed consensus. If Loup Venture is right, the estimate revisions should play out throughout 2021, theoretically lifting the stock price.
In addition to accelerating digital transformation leading to more demand for Macs, iPads and iPhones, the research firm mentions a couple of other, less frequently cited reasons to bet on Apple:
“Growing anticipation of new business segments that likely won't launch until 2022 at the earliest. We expect hardware subscription offerings that build toward a 360° bundle, along with growing optimism around a massive expansion in the company's addressable market with Apple Car.”
I agree with the perspective above. For example, I was particularly encouraged by the recent announcement of the AirPods Max. Every dollar in over-the-ear headphone sales is accretive to Apple’s revenue growth – minus a bit of cannibalization of AirPods and AirPods Pro sales, for example.
The Apple Maven also believes that Apple has a huge opportunity in brand new products and services that might include hardware subscriptions and the Apple Car beyond 2024, as well as Virtual Reality goggles and applications.
Barron’s: one of 10 best
Barron’s is a very closely followed business and finance magazine. Its stock recommendations are often cited as drivers of share price movements.
As I discussed a couple of weeks ago, Barron’s sees Apple as a top pick for 2021. According to it, Apple’s product portfolio is the main reason to be bullish.
The iPhone 12 is cited, as usual. Barron’s mentions that Apple should increase production by 30% in the first half of the coming year. But the rest of the device lineup also deserves some of the spotlight:
“The work-from-home trend and the new Apple-designed M1 chip have re-energized the Mac laptop franchise. Sales are surging for devices including watches and the new $549 AirPod Max over-the-ear headphones, which are sold out into the first quarter. Then there is a lucrative and annuity-like $60 billion services business, with new offerings like Fitness+.”
The Apple Maven made a similar point at the end of December. Apple exits the pandemic and stay-at-home year with arguably one of the most impressive lineups of products and services in recent memory.
Apple’s offerings portfolio should set the tone for the company’s financial performance in 2021 – from the iPhone 12 fueling the 5G super cycle to the brand new AirPods Max possibly exposing Apple to a whole new market of music lovers.
Kiplinger: top 15
Kiplinger is still a powerhouse in personal finance. The magazine lists its top 15 tech stocks for 2021, and Apple (barely) makes the cut, at number 15.
According to the publication, the services division is the main appeal of the company and stock. Kiplinger highlights the fact that service revenues are “stickier”, which I also believe to be an important feature of the business model. The magazine reminds readers that:
“While consumers might be enamored with the latest flashy devices that Apple is putting out, investors should pay close attention to the Services division. AAPL could be one of the best tech stocks to own as it builds on its dominant market share and squeeze additional cash from users via its services in 2021.”
I have asked Twitter: would Apple make your list of top 10 stocks to own in 2021? Feel free to share your responses below:
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(Disclaimers: the author may be long one or more stocks mentioned in this report. Also, the article may contain affiliate links. These partnerships do not influence editorial content. Thanks for supporting The Apple Maven)