Consider the big news from the world’s most valuable company this year.
- The new iPhone 6s is a huge success
- The Apple Watch grabbed a 58% market share for smartwatches
- Electric car in development … coming out in 2019
I could fill an entire article discussing Apple’s accomplishments in the last year.
Yet Apple stock has been a big disappointment. Over the last 12 months, shares have closely tracked the S&P 500 index and moved sideways.
Apple Stock Unchanged for One Year
Source: Yahoo Finance
That performance hardly matches Apple’s financial performance.
Apple closed out fiscal 2015 at the end of September. For the full year, the company’s revenues jumped 28% to a staggering $234 billion. Even more impressive was that earnings per share surged 43%.
Those results are impressive for any company. In fact, you’re far more likely to see growth numbers like this with a smaller company like wearable camera maker GoPro (NASDAQ: GPRO).
What’s unusual is the size of Apple, combined with the rapid growth.
For example, GoPro is valued at $2.7 billion. This year it’s expected to grow its sales by 22% to $1.7 billion. That growth is impressive. But as a small company, it’s easier for GoPro to put up solid sales growth numbers.
Meanwhile, Apple is a far more mature business. On a sales basis, the company is 137 times larger than GoPro. Yet its sales growth this year was far greater.
I’ve been encouraging my subscribers to get into Apple stock this year. The company continues to be a growth story, and the stock is dirt cheap. Here’s what I wrote on Oct. 28:
Apple stock remains extremely attractive at less than $120 per share. The company is likely to beat the low growth estimates for 2016, and that will be a positive catalyst for the stock.
The fact that Wall Street is skeptical of Apple’s long-term prospects offers a big buying opportunity today. The fact that Apple is big – and well known – shouldn’t deter investors from buying or owning Apple stock. I continue to believe that we’ll see Apple shares rise above $200 per share by the end of 2017.
Eventually, Apple shares will trade in line with other companies in the S&P 500. When they do, expect a big jump in the stock price.
My target price for Apple was $156 – and remains unchanged. That’s a full 33% premium to the recent share price.
On Tuesday, Goldman Sachs (NYSE: GS) released a glowing recommendation of Apple stock.
The investment bank added the stock to its exclusive “conviction buy list,” which includes the firm’s very best ideas. And the new share price target? $163.
That’s a full 43% above the recent stock price of $117.
At Wyatt Investment Research, we don’t have a “conviction buy list.” If we did, Apple would be at the top of that list.
My recommendation is simple. If you own Apple stock, remain patient. If you’re currently watching the stock, now is a great time to buy shares.
Over the years, Apple has become extremely shareholder friendly. With a growing dividend and big stock buyback, CEO Tim Cook is putting cash in the pockets of Apple shareholders.
Full Disclosure: I currently own Apple stock in my personal investment account and in the Million Dollar Portfolio.
This article is brought to you courtesy of Ian Wyatt from Wyatt Investment Research.