2. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders as of Q4: 166
Arrowstreet Capital’s Equity Stake: $6.67 Billion
Apple Inc. (NASDAQ:AAPL), ranked second among Arrowstreet Capital’s top stock picks, remains a dominant force in the global technology sector. Founded in 1976, the Cupertino-based company offers a diverse product lineup, including the iPhone, iPad, Mac, Apple Watch, and Apple TV, along with software like iOS and macOS. Its ecosystem extends to services such as Apple Pay, iCloud, and Apple Music, reinforcing its status as one of the most valuable tech firms.
In Q4 2024, Apple Inc. (NASDAQ:AAPL) reported $124.3 billion in revenue, marking a 3.95% year-over-year increase and surpassing analyst expectations. Earnings per share rose to $2.40, up $0.22 from the previous year. Additionally, on January 30, 2025, Apple’s Board of Directors announced a quarterly dividend of $0.25 per share, payable on February 13, 2025. Hedge fund interest in Apple Inc. (NASDAQ:AAPL) also increased, with 166 out of 1,009 funds tracked by Insider Monkey holding positions worth nearly $118.56 billion by the end of Q4 2024, up from 158 funds in Q3.
The company announced a $500 billion investment in the U.S. over the next four years, which includes building a new manufacturing facility, doubling its Advanced Manufacturing Fund to $10 billion, and hiring 20,000 employees primarily in R&D, silicon engineering, software development, and AI. Apple Inc. (NASDAQ:AAPL) will also produce servers in Houston starting this year, with a 250,000-square-foot manufacturing facility set to open in Texas by 2026, playing a crucial role in Apple’s AI initiatives. The company’s investment aligns with President Trump’s push for increased domestic manufacturing, with CEO Tim Cook emphasizing its commitment to American innovation. However, trade tensions with China pose potential risks, as new tariffs could impact Apple’s supply chain. In addition to expanding U.S. manufacturing, Apple is making a multibillion-dollar commitment to produce advanced silicon at TSMC’s Arizona facility and launching a manufacturing academy in Detroit to support AI-driven smart manufacturing.
Tsai Capital mentioned Apple Inc. (NASDAQ:AAPL) in its Q4 2024 investor letter. It stated:
“We initiated our investment in Apple Inc. (NASDAQ:AAPL) in 2016 and elevated it to a core holding in 2018, the same year the company introduced its redesigned 13-inch and 15-inch MacBook Pro models. Under Tim Cook’s visionary leadership, Apple has consistently redefined innovation in hardware and software.
The September 2024 launch of the iPhone 16, with its groundbreaking AI capabilities, including enhanced image generation tools, marks another inflection point. We believe this transformative device is the foundation for an AI-driven supercycle and could entice approximately 100 million consumers to upgrade, reinforcing Apple’s leadership in the industry.
Today, Apple’s ecosystem spans over two billion active devices, supported by a rapidly-growing base of subscription services. This strategy has helped to turbocharge customer engagement and spending. In the most recent fiscal year, which ended in September 2024, Apple’s high-margin services division accounted for 39.3% of total gross profits, up from 32.8% just two years ago.
Apple’s financial footing remains exceptional, with approximately $50 billion in net cash and marketable securities. Looking ahead, we expect earnings-per-share growth to outpace revenue growth, driven by margin expansion and continued share buybacks.”
