We recently published a list of 10 Most Buzzing Stocks To Buy Now. In this article, we are going to take a look at where Apple Inc. (NASDAQ:AAPL) stands against the other buzzing stocks.
Stock Market Volatility
September and October tend to be the most volatile months for the stock market, particularly during election years. This was recently discussed by Sam Stovall, the chief investment strategist at CFRA Research, who expects the volatility to stay until the end of October.
Stovall says that while the S&P 500 recovered all its 2022 bear market losses by January this year, and reached 22 new all-time highs by March, equities have digested some of these gains and experienced sector rotation away from 2023 high flyers into more defensive areas of the market. Hence, the year started great, but the markets are declining once again. The S&P 500’s average volatility in October 2023 was 35% higher than the average for the remaining 11 months of the year.
Investors are concerned that the Fed will be slower to lower interest rates while inflation remains sticky and GDP growth begins to cool. Stovall expects three 25-basis point cuts this year, followed by another four in 2025. He thinks that while a 50 basis point cut is rare since it only ever happened twice, in 2001 and then 2007, it is still not unlikely given that the economy is worse than expected.
According to Stovall, investors need to be prepared for this increased volatility as the market digests the Fed’s actions and the potential impact on the economy. The market will likely remain uncertain until the Fed can find the right balance between slowing down the economy and stopping inflation, without causing a recession.
Tom Lee, Fundstrat Global Advisors managing partner and head of research, is of a similar idea, suggesting that investors should remain cautious over the next 8 weeks, due to both uncertainty surrounding elections and the September cuts. He says that the stock market may experience a 7-10% pullback, considering there have already been two 7% corrections this year.
Lee thinks at least a 5% pullback can be anticipated, but if it’s only 1-2%, then that’s negligible. But despite the recommended caution for the 8 weeks starting September, he thinks the volatility does not translate into a tough full-year. He views this pullback as a buying opportunity, believing that the market has not yet reached its peak for 2024.
As Lee encourages investors to be ready to buy the dip, we are here with a list of the most buzzing stocks to buy now.
Note: All price/volume data is as of September 6.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A wide view of an Apple store, showing the range of products the company offers.
Apple Inc. (NASDAQ:AAPL)
Volume: 43.617 million
Average Volume (3-Month): 63.905 million
Number of Hedge Fund Holders: 184
Apple Inc. (NASDAQ:AAPL) is a consumer electronics firm, known as the company behind iPhones. These iPhones alone make up 46% of the company’s net sales. It also offers services including iCloud, Apple Pay, Apple Music, and Apple TV+.
In FQ3 2024, the company launched Apple Intelligence, a personal intelligence system backed by AI, integrated into all new iPhone, iPad, and Mac models.
It plans to launch the next generation of the iPhone lineup in September. This annual event is receiving a lot of attention because the company is expected to unveil new AI features for these phones. Lagging iPhone sales in recent years have slowed the revenue growth for the company, and this AI upgrade is expected to change its growth outlook. However, even more advanced AI features will not roll out earlier than 2025.
On August 29, 2024, The Wall Street Journal reported that Apple Inc. (NASDAQ:AAPL) is eyeing a major investment in OpenAI, along with NVIDIA, as part of a funding round led by Thrive Capital that would value OpenAI at $100 billion.
The revenue for this fiscal quarter was up 4.87% year-over-year. Of this, the iPhone reported revenue worth $39.3 billion and Mac revenue was $7 billion, up by 2% from a year ago.
Apple Inc. (NASDAQ:AAPL) is also a great choice for ESG investors, given its commitment to labor rights, environmental responsibility, and ethical business practices. It has reduced its overall greenhouse gas emissions by over 55% since 2015, marking progress toward its 2030 goal of achieving carbon neutrality across its entire value chain.
Currently, 184 hedge funds are long in Apple Inc. (NASDAQ:AAPL). Berkshire Hathaway has the highest stake in the company, with a position of $84,248,000,000.
Mar Vista Focus strategy stated the following regarding Apple Inc. (NASDAQ:AAPL) in its Q2 2024 investor letter:
“Investors were reminded of the strength of the Apple Inc. (NASDAQ:AAPL) ecosystem as management demonstrated how generative AI solutions would be integrated into Apple’s 1.2 billion iPhone installed base. Apple plans to integrate generative AI features into its iOS 18, which will be broadly released in the fall with the iPhone 16. We believe Apple should benefit from generative AI as it will spur a meaningful iPhone upgrade cycle and create new avenues of monetization through its app store and advertising offerings. We believe this will support intrinsic value growth that will range between high-single-digits and low-double-digits over our investment horizon.”
Overall AAPL ranks 2nd on our list the most buzzing stocks to buy. While we acknowledge the growth potential of AAPL as an investment, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than AAPL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.