1. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders as of Q4: 166
SICM’s Equity Stake: $17.74 Million
Apple Inc. (NASDAQ:AAPL) ranks 1st on the list of the top 10 stocks to buy according to Sustainable Insight Capital Management. The company, based in Cupertino, California, is a global technology leader known for its innovative consumer electronics, software, and services. In addition to a wide range of products, Apple also offers services such as Apple Pay, iCloud, and Apple Music, solidifying its position as one of the world’s most valuable tech companies.
In the quarter ending December 2024, Apple Inc. (NASDAQ:AAPL) reported $124.3 billion in revenue, a 3.95% year-over-year increase, slightly exceeding analyst expectations. Earnings per share (EPS) rose to $2.40, up $0.22 from the previous year. On January 30, 2025, the company’s Board of Directors declared a quarterly dividend of $0.25 per share, payable on February 13, 2025.
The share price of Apple Inc. (NASDAQ:AAPL) climbed following the company’s stronger-than-expected earnings report, driven by increased iPhone upgrades for AI-powered features. Despite a decline in iPhone sales during the December quarter, partly due to regulatory challenges in China and the gradual global rollout of Apple Intelligence, Apple’s overall profit exceeded forecasts, thanks to strong growth in its services division. CEO Tim Cook highlighted that iPhone upgrades reached a record high last quarter and expects Apple Intelligence to gain widespread adoption as iPhone 15 and 16 sales grow. In April, Apple Intelligence will expand to additional languages, broadening its reach. Apple’s stock has risen 30% over the past year, outperforming the broader market. Given Apple’s strong financial position, increasing adoption of AI-driven products, and expanding services segment, it remains a top stock to buy, offering long-term growth potential and market stability.
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.”
Overall, Apple Inc. (NASDAQ:AAPL) ranks first on our list of the top 10 stocks to buy according to Sustainable Insight Capital Management. While we acknowledge the potential for AAPL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. 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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