Sure, Apple Stock Is Pricey, but It’s Still a Great Buy
Shares of Apple (NASDAQ:AAPL) are the gift that keeps on giving. Apple stock is a solid buy-and-hold that you can bequeath to your children and grandchildren someday, knowing that they’ll continue to appreciate in value through multiple economic recessions and long after CEO Tim Cook has moved on.
Source: View Apart / Shutterstock.com
If you’re a market timer, however, then you’ll understand that price does matter, and Apple shares aren’t exactly cheap at the moment. Indeed, the stock price is nowhere near the 52-week low of $142, but that’s okay because there are still reasons to take a position and expect great things from this globally recognized and respected brand.
Apple Stock and the Siri Scandal
Today I was heartened to learn that Apple has apologized for having its high-tech personal assistant device, Siri, store the audio recordings by default whenever its users spoke to it. Reportedly, workers had been privy to rather confidential voice recordings of Siri users including drug deals and, let’s just say, people “getting romantic.”
InvestorPlace - Stock Market News, Stock Advice & Trading Tips
In the wake of Facebook’s (NASDAQ:FB) highly publicized data-breach scandal, tech-centered companies have been scrambling to establish their reputations as secure, respectful, and non-invasive when it comes to users’ privacy.
For instance, Google (NASDAQ:GOOGL) stopped reviewing voice recordings from the company’s Google Assistant platform after an audio leak was reported.
To be honest, I feel that Apple has done a much better job at protecting users’ privacy than Google and especially Facebook, which has paid lip service but I’d like to see more action from Mr. Zuckerberg and company.
In contrast, Apple has ensured that all audio recordings on Siri are deleted after a while; calendar appointments and unread messages aren’t sent to Apple servers; Siri users are identified by randomly generated numbers rather than their full names; and, as mentioned earlier, Siri will finally stop recording users’ voices as a default setting.
Hopefully, these steps will mark a new direction; not only for Apple but also for the broader tech industry as consumers continue to seek better protections through company self-policing rather than having to resort to governmental regulation.
Apple TV+ Could Be a Springboard for Apple Stock
With its launch date slated for November of this year, it won’t be long before Apple TV+ makes waves in the content-streaming space. It’s a massive industry amounting to $36.64 billion last year, according to Grandview Research, and the CAGR (compound annual growth rate) from 2019 to 2025 is projected to be a very impressive 19.6%.
Apple, as we might expect, plans to take a big bite out of that lucrative pie: analysts from research firm Cowen predict that Apple TV+ will garner 12 million subscriptions in 2020 and will have a total of 21 million subscriptions by the end of 2021. As I see it, there are already 1.4 billion active Apple devices out there, so it won’t require a hard sell to get a portion of those users onto the Apple TV+ platform.
This should translate to a strong positive impact for AAPL stock investors, with Apple TV+ potentially contributing $0.11 to the Apple stock EPS in 2020 and another $0.32 to the EPS in 2021. And, as a streaming-service customer, I must admit that I’m attracted to the $9.99 expected monthly subscription price for Apple TV+; if the company keeps the price competitive, I’m envisioning a loyal and sizable user base for this streaming platform.
The Takeaway on Apple Stock
I’m highly encouraged by Apple’s forward-thinking initiatives; clearly, the innovative spirit of Mr. Steve Jobs is alive and well, and continues to inform the direction of the company he founded.
Even smaller-scale offerings like gaming platform Apple Arcade – which has been priced at just $4.99 per month and offers over 100 games – demonstrate that Apple is a company constantly in motion. If I’m correct in my assessment, Apple stock will be in motion too – upwards I imagine, at least over the long term.
As of this writing, David Moadel did not hold a position in any of the aforementioned securities.
More From InvestorPlace
The post Sure, Apple Stock Is Pricey, but It’s Still a Great Buy appeared first on InvestorPlace.
