1. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 135
Apple Inc. (NASDAQ:AAPL) is a global company that specializes in the design, production, and marketing of various technology products. Their product portfolio includes smartphones, personal computers, tablets, wearables, and accessories. In addition, they offer home entertainment devices such as Apple TV, Beats products, and the HomePod. Apple Inc. (NASDAQ:AAPL) is one of the premier consumer electronics stocks to invest in.
On April 26, Deutsche Bank increased its price target for Apple Inc. (NASDAQ:AAPL) from $160 to $170 and maintained a Buy rating on the company’s shares. The analyst predicts that Apple Inc. (NASDAQ:AAPL)’s fiscal Q2 results will align with market expectations, with the success of the iPhone compensating for some weaknesses in other areas. Looking ahead to Q3, the firm anticipates a possible decrease in Products revenue compared to estimates, but also foresees improved profit margins due to lower component costs, resulting in earnings that meet expectations. Deutsche Bank believes that investors are drawn to Apple Inc. (NASDAQ:AAPL) due to its reliable earnings and robust financial position, especially during uncertain economic conditions.
According to Insider Monkey’s fourth quarter database, Apple Inc. (NASDAQ:AAPL) was part of 135 hedge fund portfolios, compared to 140 in the prior quarter. Warren Buffett’s Berkshire Hathaway is the largest stakeholder of the company.
L1 Long Short Fund made the following comment about Apple Inc. (NASDAQ:AAPL) in its Q1 2023 investor letter:
“Apple Inc. (NASDAQ:AAPL) (Short +27%) shares rose over the quarter with mega-cap technology stocks rallying as volatility in the banking sector led to investors crowding into stocks perceived as more defensive and liquid. We continue to see risks to Apple’s earnings as demand weakens for its key products and in particular its flagship iPhone 14 device. Despite having a fantastic brand and loyal customer base, we believe the company has benefited significantly from a one-off pull forward of demand through the COVID-19 lockdown period, which we expect will start to normalize over the next 2-3 quarters.
The lockdown period delivered a huge windfall to Apple as a combination of work/study from home conditions and government stimulus fuelled a surge in purchases of its key products. During this period, Apple also benefitted from the launch of two of its most important products (5G iPhone 12 and Apple Silicon MacBook), along with significant market share gains in China. This drove a spike in net profit from a broadly flat range of US$50-60b p.a. between FY15 to FY20 to ~US$100b in FY22. We believe tougher economic conditions, a less exciting new product line-up and input cost pressures will weigh on Apple’s ability to meet/exceed consensus earnings expectations in 2023 (which assume solid earnings growth from an inflated base). Apple shares are currently trading around ~$165/share, compared to around $80/share pre-COVID.”
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