Apple Stock Soars -- Why It Can Go Higher

Core Viewpoint - Apple has experienced a significant rebound in stock price, driven by strong fiscal results and the successful launch of the iPhone 17 lineup [1][2] Group 1: Recent Financial Performance - Revenue for fiscal Q3 increased by 10% year over year to approximately $94.0 billion, compared to 5% growth in the previous quarter [5] - iPhone sales rose about 13% to approximately $44.6 billion, while services revenue also increased by 13% to a record $27.4 billion [5] - All geographic segments showed growth in the June quarter, contrasting with earlier fiscal periods [6] Group 2: Profitability Improvements - Earnings per share grew 12% year over year to $1.57, driven by higher gross profit from iPhone and services [7] - Total gross margin reached 46.5%, slightly up from the previous year, despite tariff pressures [8] Group 3: Financial Strength - Apple ended the quarter with about $133 billion in cash and marketable securities, alongside roughly $92 billion in term debt [10] - The company authorized a new $100 billion share repurchase program and increased the quarterly dividend by 4% to $0.26 [11] Group 4: Product Demand - Demand for the iPhone 17 is reportedly ahead of last year's cycle in both the U.S. and China, suggesting potential for continued double-digit growth in iPhone sales [12] - The new iPhone lineup has received positive feedback, with notable features in the iPhone 17 Pro and the introduction of the iPhone Air [13] Group 5: Valuation Perspective - The stock trades at 32 times forward earnings, which is considered reasonable given the quality of Apple's business and recent performance improvements [15] - The combination of strong iPhone sales and the growth of the high-margin services segment is expected to support this valuation [15]