Why Apple Stock Is Easy Money!
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Today we discuss Apple stock and why Apple represents the easiest money to be made in the stock market. I have been bullish on Apple since iPhone 7 came out in September of 2016 and I am still super bullish.
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Today I’m going to take you guys through why Apple stock represents the easiest money you can make in the stock market. Okay, this is my view on Apple I’m going to take you through all the different points on why.
I view Apple literally as the easiest money you can make over the next 510 years in the stock market. It’s like it’s ridiculous how easy it is when you buy Apple stock guys, and we’re gonna go through all the points here notice.
Apple represent the biggest amount of money you can make in the stock market as far as stock that can go up the most i don’t think so not even close. But as far as like you know, almost almost a guaranteed return of a nice return over the next 510 years.
It pretty much represents that guys. So let’s talk about Apple here into depth. I’m going to take you all through this on why I literally view it as the easiest money you can make in the stock market. Okay, so Apple The first thing.
I’m gonna think of is their main part of their business, which is iPhone. Okay, iPhone iPhone iPhone, this is a main part of their business. And so you got several key factors going into iPhone that makes me very bullish on Apple overall and iPhone overall.
If you don’t already know the by far that Apple’s biggest segment is their iPhone as far as what to their business after that services after that. It’s Macs and iPads and all that other stuff, accessories and whatnot. iPhone. Okay.
Let’s just talk about iPhone for a minute, right? One, you’re going to have big unit volumes go up okay. Now, not necessarily this year, not next year, unit units are going to go up massively when five g comes out. Okay, 5g.
The iPhone is expected to probably come out around September 2019 is expected when the 5g iPhone is going to come out that is going to create a massive supercycle for people upgrading to 5g Okay, if you don’t already know.
5g is a massive improvement over 4g and basically they’re gonna make 4g technology make it look like you have a 3g phone nowadays. Okay, if you have a 3g phone nowadays, it’s like a joke, right? 4g is gonna look like such a joke.
Once 5g comes out, we’re talking about speeds between 10 and 100 times faster guys. It’s ridiculous. Like you want something to pull up? It pulls up immediately, like no question about it. Okay, you can download a mini video in literally like seconds like seconds an entire, you know.
Video download or a movie will download versus You know, sometimes it takes minutes or hours on 4g. Okay, massive improvement. So we’re gonna see unit volumes go up big time when the 5g iPhone comes out.
All right. Also, we’re gonna continue to see average selling prices go up. Okay, average selling prices are going up significantly. Because basically, as more and more features get in these iPhones and not just iPhones as in the high end.
Samsung’s as well, in the high end, Google phones, the pixels and whatnot. As you know, more and more, you know, I guess you say value is there, guess what’s going to happen? The price goes up and up and up.
And that’s been the history of the smartphone, right? Is the original iPhone was around $499 original iPhone was around $409. And they thought that was so expensive, oh my gosh, who’s gonna spend $499 on an iPhone, and then just kept going up going up going up.
Now we’re at about $1,000 if you want the high end, iPhone, okay, 1000 bucks, okay. And it’s going to continue to go up as you know, that basically features become more and more important, as I’ve been talking about for year two in this channel.
The smartphone represents the most important device in people’s lives over everything, okay, over everything over their car, over their TV over everything that their phone, you take that away from them, it’s like, not cool, man, especially when you talk about around the world, places like China.
There’s, there’s, you know, in the United States, the smartphone is seen as everything right, then go to China. And it’s like 10 times more valuable there, guys. So we’re gonna continue to see average selling prices go up.
And we’re gonna see major unit volume start to go up when the 5g iPhone comes out, which is probably September 2019. If it doesn’t come down to those 90 is gonna come out probably in September 2020. Okay.
So regardless, over the next year or two, you’ll you’ll end up starting to see units go up. So that’s iPhone, that’s great. When you got average selling prices going up and you got unit volumes that will start to go up in a major way.
Again, this is just, you know, huge business already, and it’s continuing to get big. Okay. Then from there, we’re going to go on to the next part here, which is we talk about services. Okay, so now, the next bullet thesis on this one is services.
All right, their services business is continuing to increase dramatically. Okay, dramatically. We’re talking about IT services last quarter was up somewhere around 30%. Okay, so this is a pretty consistent 20% to 30% growth engine for Apple right now.
And it’s already the second biggest business and so much as money is just straight profit. And this is something that’s, you know, maybe the growth rates will end up slowing eventually, but as far as you know, could you ever See this business going negative.
No, not really services is a category that will continue to grow for Apple, because of all the innovation, the App Store, so many people sign up for services that are recurring revenue, you know, think of the Netflix or think about the Spotify or Apple Music.
You know, actual, you know, Apple mint branded products and things like that, you know, think about all the game apps, there’s so much that that Apple’s making money on all that. And that’s just a trend that’s going to increase and increase and increase over time.
Will they always be able to grow at 20 30% I doubt it, eventually, the law of large numbers will catch up with them, and the growth rates will slow but you know, even when they slow it’s already going to be such a massive business.
This could be as big as iPhone, if not bigger than iPhone within five years, guys, that’s how much this business is going up. Okay. So services is going to continue to be a profit beast for them. All right, then let’s go on to the next part, which is around therefore PE right now.
This is a company that does not have a high value on the Ford p e ratio. Okay? Before PE on Apple right now somewhere around a 14. Okay, that is low. That is really, really low, especially for a company that has very nice growth.
Look at the growth in profits they had last quarter look at the growth in revenues are extremely impressive. They’re actually a pretty decently strong growing company. And they’re trading like that’s a value stock. Okay, that’s a big mistake there. All right.
Next up, we’re going to go on to basically what they have as cash, okay, cash, they have ridiculous amounts of cash on that balance sheet that can be used for so many different things. All right, that cash can get in through a rainy day.
If we have a recession anytime soon, right? If we have a recession 234 or five years from now, they got so much cash, you know, they don’t even have to, you know, fire any employees or anything like that they don’t want they got so much cash is ridiculous.
And guess what? There’s such a profitable business, that those 10s of billions of dollars, they throw off each quarter, right? in profits, just go straight to cash, okay. And then they can do some interesting things with it from there. Okay.
They can do some real interesting things. So with this cash, they go ahead and they do buybacks. Okay, they go ahead and do buybacks, which these buybacks take off massive amounts of shares off the market, okay, which makes their epcs go up. Okay, ETS look even better, and better and better.
Now, the ETS is going up for a few reasons. One is they’re doing this massive buyback taking more shares off the market, and you take more shares off the market, that’s less shares to count against the net income, which makes your EP s look even better.
And then when you’re making more and more profits, because iPhone business is exploding services, business exploding, all these type of things, and you already have a low for P, it just makes it that much better. Guys, when you’re doing a buyback and you’re bringing down that share count out there.
It’s huge. It’s so big guys, that’s it’s a massive, massive thing. Okay, next part we’re going to go into here is what I call, they’re going to have more and more depth increases, okay, dividend increases. So basically, the dividends are likely going to continue to go up year after year after year.
As those dividends get bigger and bigger and bigger, more and more dividend investors are going to want to flock to Apple stock, they could they could literally double that dividend tomorrow, and it would hardly even affect the company. Okay, in terms of cash and whatnot.
They could literally double it tomorrow, like they could triple it and still be at a safe place. They could nearly quadruple it and still be, you know, a place where they actually are under some companies as far as what companies pay out in dividends.
So dividend is likely to increase in massive, massive ways there guys, right? Then from there. I mean, if this isn’t enough, bullishness, you know, reason to want to buy Apple stock. I don’t know what else we could have here.
But then we have the accessories category, we’ll just call it the new stuff category. Okay, new stuff. Okay, what is new stuff category, think about the wireless earbuds they have now that a lot of people are starting to get, think about the new home pods that are going into people’s homes.
Think about all those things, think about Apple Watch. Think about all those different devices. Okay? This is all new revenue, new profit stuff, okay? and new ways to get people in the door to get Apple products.
You see, Apple’s master plan is always not just to necessarily make a bunch of money off of specific product. It’s to get you to become a loyal customer to get an iPhone, okay, this is their master plan.
And when you get an iPhone, you’re going to spend a bunch of money on services, okay. And they do this very successfully by launching successful accessory products. Okay. So for instance, on how I got hurt, I was never.
I never used Apple products. I refused to use Apple products, you know, in growing up as a kid and whatnot. All of a sudden, I’m not 2021 years old, okay, I meet my wife and she wins an iPod Touch from the company or when we were working out, okay.
And so she wins his iPod Touch and I start using it. And this little teeny iPod Touch. I started using that more than I was using my actual laptop can And then next thing you know, I buy an iPad, okay.
And I love that iPad I’m using all the time and I was using an Android phone at that time. And I was like, I love the software. I love the way everything works is so intuitive. I was using this a Huawei phone at the time. And next thing you know, a year later.
I get an iPhone. And nowadays, I’m Apple through and through, I have iPhones, iPads, Macs, the whole deal, they won me over as a customer and probably forever, okay, I buy those services they make, you know.
I have their cloud products, they make so much money off me. And, you know, each year, it’s insane. Okay, so they want me over. So all this new stuff, it just gives Apple more and more opportunities to win over more and more customers. Okay, the same way iPads did for instance.
I know people in my real real life that have gotten iPads within the past year. And they were diehard Samsung, and guess what phones they just bought last month, last month, they just switched over to iPhones. It’s amazing how it goes guys.
And that’s how they get more and more customers through the door. They delight, they make the customer happy. The customer enjoys whatever device they start off in might be an Apple Watch. In the future.
It might be a home pod might be you know, headphones, whatever. And they use that first product. And next thing you know, they want Apple for everything they buy the iPhone, they get to services, everything okay.
And it’s just it’s just easiest money you can make out there, guys, it’s the easiest money you’d make. I mean, are there risks to Apple, I guess there’s risk to every company who’s gonna come and take them out Samsung Google now No, not gonna come take him out.
Could be a new company. Good luck with that. Okay, Apple’s probably the last company I would ever want to compete against, directly or indirectly, like, it’s just ridiculous, guys, good luck competing against those guys.
So when I look at this, you’re gonna have massive increase in unit volume and iPhone, once 5g comes out, you have average selling prices going up, you have services, which has become their second biggest business increasing dramatically and will continue to, okay.
You have a low four P of this company under what the markets trading at, which is crazy, because this is a strong growth company, you have them have massive amounts of cash reserves, and throwing off, you know, 10 billion plus a quarter and profits.
Then they use that cash to do these huge buybacks, which makes ETS go up even more and more because one, they’re more profitable, too, they’re taking more shares off the market and makes earnings per share look even better makes them more valuable company.
Dividend increases are likely to come each year over the next you know, 510 years to you know, get to a place where they’re going to probably start paying out five to $10 a year in dividends, okay, and you got all this new stuff.
Which is just going to drag more and more, not just that this is going to create new revenue, new profits for Apple, but it’s going to bring in more and more customers to become the loyal customers who have the iPhone and the services which is the holy grail for Apple and easiest money.
There is money out there guys. I’ve been bullish on Apple since I’ve been bullish on Apple since it was around 100 $102 when they basically came out with iPhone seven I posted a video on this channel about you know, being bullish on Apple.
And I’ve just been bullish flag is nothing else I can say about that. Since that time, Apple’s not quite doubled is probably up 80 or 90% since then, and I don’t see any reason why it’s going to slow anytime soon.
Maybe they have a year where you know the stock doesn’t move or goes down a little bit. But when I look around over the next 510 years, there’s pretty much no easier money to be made out there than Apple.
I hope I hope it goes down I hope you know analysts come out and say oh, iPhones not going to grow anymore, whatever they’re going to make up in their heads. I hope they come out and say that because I would love to buy more and more Apple shares.
I would love to we have a big apple stake already. I would love to double or triple that this year. That would be freakin phenomenal. So we’ll see what happens guys but anyways, easiest money in the market in my personal opinion. Let me know what you think in that comment section. Thank you for watching. Have a great day.