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There's no best, but better: Apple's stock hits a record high
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Apple Is the World's First $3 Trillion Company. How To Find The Next Apple?

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Moomoo Learn joined discussion · Jul 3, 2023 01:56
On June 30th, at the close of US stocks, $Apple (AAPL.US)$ Inc. reported a closing price of $193.97 per share, representing a 2.31% increase in value and resulting in a closing market capitalization of $3.05 trillion.
Source: moomoo
Source: moomoo
This achievement marked a significant milestone for Apple as it became the first company ever to attain such a massive market capitalization.
In fact, Apple's market capitalization surpassed the combined values of $Alphabet-A (GOOGL.US)$ and $Amazon (AMZN.US)$, and was more than $500 billion higher than its closest competitor $Microsoft (MSFT.US)$, which is roughly equivalent to the market capitalization of three $Tesla (TSLA.US)$.
In order to understand how Apple reached a staggering market value of $3 trillion, let's take a look back at its history.
The Accomplishments of Tim Cook
Although Tim Cook may not have become the second Steve Jobs, he has undoubtedly played a crucial role in making Apple the most profitable company on Wall Street and in Silicon Valley.
As someone with experience in the supply chain, Cook oversaw Apple's move to shift its production base to Asia. He recognized that the procurement of components and management of service supply chains were major expenses for high-tech companies, and believed that working with hundreds of smaller companies in Asia would allow for greater scalability and cost-effectiveness.
Throughout Cook's tenure, he chose to focus on expanding Apple's most important product line, the iPhone, rather than making major changes to it. This approach involved continuously releasing new models that built upon the original design.
In 2014, Cook launched the iPhone 6 with a larger screen size, which helped propel Apple to become the world's most profitable company that year.
Cook also recognized the need to cater to consumers who were hesitant to purchase an iPhone due to its high price, resulting in the launch of the SE series.
Subsequently, Apple continued to release new models such as the iPhone Pro and iPhone Pro Max, successfully meeting the evolving demands of potential consumers.
When comparing Apple's revenue structure before and after Cook's 10-year tenure, it becomes apparent that the revenue from iPhone sales has remained relatively stable. However, there have been notable changes in other areas.
The proportion of revenue generated by Macs and iPads - products introduced during Jobs' tenure - has steadily declined over time.
Meanwhile, the proportion of revenue derived from services has increased significantly, reflecting Apple's emphasis on expanding its service offerings.
In addition to these changes, revenue from new products such as wearable devices has doubled under Cook's leadership. The Apple Watch and AirPods, both launched during Cook's tenure, have become essential products in their respective categories.
Apple Is the World's First $3 Trillion Company. How To Find The Next Apple?
[Explore moomoo Feature]
If you are interested in the composition of Apple's main business, you can easily access its financial report on moomoo.
AAPL > Financial > Revenue Breakdown
Source: moomoo
Source: moomoo
There have been several significant initiatives implemented by Cook that have had an impact on Apple's financial performance.
Under the leadership of Steve Jobs, Apple never paid dividends, even as its stock price continued to soar. However, after Tim Cook took over as CEO, he changed this approach and moved away from Jobs' "stingy" style. Not only did Cook continue to pay dividends, but he also initiated frequent stock repurchases.
Beginning in March 2012, Apple began paying quarterly dividends and repurchasing stocks. Over the past decade, Apple's stock repurchases have consistently been at the top of the list of major listed companies in the United States in terms of both quantity and amount. Through these initiatives, Apple has proactively reduced the number of circulating stocks in the market, which has helped to increase its stock price and provide returns for investors.
Aside from repurchases and dividends, Apple has also split its stock twice - once in June 2014 and again in August 2020. These moves significantly decreased Apple's stock price, making it more accessible to small and medium-sized investors who may not have been able to afford a single share at previous prices.
In terms of profiting from Apple's stock price increase, several organizations have emerged as the biggest winners over the past decade. These include Vanguard, BlackRock, and Berkshire Hathaway.
$Blackrock (BLK.US)$ became Apple's largest shareholder in 2012 with a 5.3% stake, which has since grown to a current value of $170.4 billion.
$Vanguard Global Aggregate Bd Hdg ETF (VBND.AU)$ surpassed BlackRock in 2014 with a latest stake ratio of 8.33% and a stake value of $215.7 billion - representing substantial profits when compared to their initial investment amount.
Starting from the first quarter of 2016, $Berkshire Hathaway-A (BRK.A.US)$ - owned by Warren Buffett - began purchasing Apple's stock. The initial position amounted to about $1 billion when Apple's stock price ranged between $90 and $100. Over the following two years, Buffett continued to increase his stake in Apple's stock multiple times. By June 30, 2018, Berkshire Hathaway's position had grown to 255 million shares, with a stake ratio exceeding 5% for the first time, reaching 5.2%. It is worth noting that investing in Apple Inc. became one of Warren Buffett's most profitable investments.
[Explore moomoo Feature]
If you want to learn more about which institutions have shown interest in a particular star stock, you can find relevant information on moomoo.
AAPL > Analysis > Institutional Holdings
Source: moomoo
Source: moomoo
How to Find The Next Apple?
Although the macroeconomic environment may change over time, the criteria for selecting good company stocks remain relatively constant. While the specific criteria may vary from investor to investor, certain fundamental aspects tend to be consistent. These include stable and growing earnings, high return on equity (ROE), high dividend yield, and positive cash inflows - all of which are enduring indicators of a company's financial success and its potential as a good investment.
To help investors navigate these criteria, moomoo Learn provides a useful resource outlining four commonly used stock selection metrics. For more detailed information on these criteria and others, please refer to the Financial characteristics of good stocks.
These criteria include:
Stable and growing earnings: Earnings are an essential factor in considering a stock as a good investment. There are many ways to evaluate earnings, but growth and stability are key metrics.
High ROE: Return on equity (ROE) measures the profitability of a company relative to the money shareholders have invested.
High dividend yield: The dividend yield is the amount of money a company pays shareholders for each share they own divided by the current stock price. Mature companies are more likely to pay dividends.
Positive cash inflow: Cash flow refers to the net transfer of cash and cash equivalents into and out of a company, making it an important indicator of a company's financial health.
For more investment knowledge and trends, be sure to follow moomoo Learn.
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only. Read more
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