Summary
Highlights
Q1 2024 Results Overview00:00:07
Apple's Q1 results (January to March) showed a 5% increase in revenue year-over-year, totaling $95 billion, but fell short of the $98 billion expected by analysts. Net profit decreased by 3% to $22 billion due to rising supply chain costs. iPhone sales increased by 2%, which was considered underwhelming by analysts. The services sector, including App Store, iCloud, and Apple Music, saw a 10% revenue increase.
Stock Price Reaction and Short-Term Trading00:03:53
Following the results, Apple's stock price dropped by 6%. For short-term investors, it's recommended to wait for the stock to stop falling before buying to avoid 'catching the falling knife'. Buying should align with an upward trend, not during a decline.
Risks and Challenges00:05:25
Potential risks include Donald Trump's criticism regarding Apple's manufacturing locations and potential tariffs. iPhone sales in China have decreased by 2.3% as consumers increasingly favor domestic brands. Apple is also facing antitrust scrutiny over its App Store practices, which could weaken its services sector growth.
Valuation and Investment Opportunities00:07:58
Apple's price-to-earnings ratio (PER) is 26, which suggests the stock is relatively cheap compared to historical levels and other tech companies. This indicates a good price-to-earnings quality. Apple also increased its dividend by 4% and announced a $100 billion share repurchase program, which can boost the stock price. Moving production to India and Vietnam could help mitigate trade war risks.
Long-Term Strategy and Conclusion00:11:24
Apple is focusing on artificial intelligence and augmented reality. For long-term investors, the current PER of 26 might present an attractive buying opportunity. Short-term investors should wait for a clear upward trend before entering the market. Remember to do your own analysis, a free fundamental and technical analysis is available for subscribers in the description.