Norwegian Billionaire Halvorsen’s Top 10 Stock Picks

3. Apple Inc. (NASDAQ:AAPL)

Viking Global’s Q3 Stake: $1.13 billion

Number of Hedge Fund Holders: 158

Apple Inc. (NASDAQ:AAPL), renowned for its iconic iPhone, Mac computers, and iPads, also derives significant revenue from its services segment, which includes Apple Pay, the App Store, Apple Music, and iCloud.

On October 31, Apple Inc. (NASDAQ:AAPL) announced a record fourth-quarter revenue of $94.9 billion, a 6% increase from the previous year, fueled by strong demand for the iPhone 16 series, Apple Watch Series 10, and AirPods 4. The company is also gearing up for the release of its 18.2 software update, which will introduce a range of AI-powered features and is expected to roll out to users soon. Additionally, the tech giant is expanding its services into new markets, with the highly anticipated launch of Apple Intelligence in China marking a significant step in its global growth strategy.

UBS analysts have adopted a cautiously optimistic stance on Apple’s iPhone 16, citing mixed demand signals and lukewarm interest in AI-related features, particularly outside of China. A UBS Evidence Lab survey revealed varying consumer sentiment across regions. In the U.S., purchase intent remained steady at 24%, while in China, it dipped to 17%, a 200-basis-point decline from 2023. However, Europe showed positive trends, with purchase intent rising in the U.K. by 200 basis points to 19% and in Germany by 300 basis points to 14%. Despite the tempered demand and skepticism toward AI features, UBS raised its global smartphone sell-in estimates to 1.21 billion units for 2024 and 1.24 billion units for 2025, indicating modest growth. On December 2, UBS maintained a $236 price target and a Neutral rating for AAPL shares, valuing the stock at 32 times its projected 2026 earnings per share of $7.49.

In its third quarter 2024 investor letter, Madison Investments said the following regarding Apple Inc. (NASDAQ:AAPL):

“Alphabet Inc., Eli Lilly and Company, Qualcomm Incorporated, Microsoft Corporation, and Apple Inc. (NASDAQ:AAPL) were the largest detractors. Apple has been volatile in the last quarter but ended on strength. Early in the quarter, Apple benefited from the introduction of their AI strategy, Apple Intelligence. They followed in September with the new iPhone 16, which also created some excitement. We are underweight to Apple, which has resulted in a headwind for performance.”