Make no mistake, Apple has been the Herculean force of 2020, as shares have climbed 74%, to a recent $128, on its way to a world-leading $2.2 trillion market value. The stock, now trading for 32 times P/E of $3.95 a share in the fiscal year ending in September, is historically pricey.
But Apple [$AAPL] has never been stronger, thanks to synchronous product cycles, notably the current one, which includes the sizzling new iPhone 12. Apple is reportedly boosting production of that mobile phone by 30% in the first half of 2021. Keep Losing Your AirPods? Apple’s New Product Will Fix That
The work-from-home trend and the new Apple-designed M1 chip have reinvigorated the Mac laptop lineup. Sales are skyrocketing for devices including watches and the new $549 AirPod Max over-the-ear headphones, which are sold out into Q1. Then there’s a profitable and annuity-like $60 billion services business, with new offerings like Fitness+.
Samik Chatterjee, analyst at J.P. Morgan, asserts that investors may have to pull back their expectations after 2020, but he still forecasts upside to $150 a share, based in part on an above-consensus earnings estimate of $4.45 a share for 2020. Apple Continues To Bully, Only This Time It’s Qualcomm