The S&P 500 is too tech-heavy. This alternative ETF keeps beating it.
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 01 2024
0mins
Should l Buy AAPL?
Source: MarketWatch
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Recent Performance Warning: Despite the S&P 500's impressive return of 36.4% over the past year, investors are cautioned about potential risks associated with such high returns.
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Analyst Views on AAPL
Wall Street analysts forecast AAPL stock price to rise
27 Analyst Rating
17 Buy
9 Hold
1 Sell
Moderate Buy
Current: 261.730
Low
239.00
Averages
306.89
High
350.00
Current: 261.730
Low
239.00
Averages
306.89
High
350.00
About AAPL
Apple Inc. designs, manufactures and markets smartphones, personal computers, tablets, wearables and accessories, and sells a variety of related services. Its product categories include iPhone, Mac, iPad, and Wearables, Home and Accessories. Its software platforms include iOS, iPadOS, macOS, watchOS, visionOS, and tvOS. Its services include advertising, AppleCare, cloud services, digital content and payment services. The Company operates various platforms, including the App Store, that allow customers to discover and download applications and digital content, such as books, music, video, games and podcasts. It also offers digital content through subscription-based services, including Apple Arcade, Apple Fitness+, Apple Music, Apple News+, and Apple TV+. Its products include iPhone 16 Pro, iPhone 16, iPhone 15, iPhone 14, iPhone SE, MacBook Air, MacBook Pro, iMac, Mac mini, Mac Studio, Mac Pro, iPad Pro, iPad Air, AirPods, AirPods Pro, AirPods Max, Apple TV, Apple Vision Pro and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Apple Reports Strong Q1 Growth Amid Challenges
- Significant Revenue Growth: Apple reported a 15.7% year-over-year revenue increase in Q1 2026 (ending December 27), primarily driven by robust demand for the iPhone 17 lineup, showcasing its sustained leadership in the smartphone market.
- iPhone Sales Surge: iPhone sales rose 23.4% year-over-year, further solidifying Apple's market dominance in hardware, indicating strong consumer preference and brand loyalty.
- Exceptional Profit Margins: The company's net income margin reached 29.3% in the last fiscal quarter, reflecting its outstanding profitability and pricing power, despite facing regulatory scrutiny and delays in Siri updates.
- Cautious Market Outlook: While Apple's P/E ratio stands at 33.1, indicating a premium valuation, investor concerns about its cautious approach in the AI race may lead to underperformance compared to the broader market over the next five years.
See More
Apple Releases iOS 26.4 Beta and Announces Product Showcase
- New System Release: Apple launched the iOS 26.4 beta on Monday, introducing features like video podcasts and an Apple Music playlist tool, but lacking enhancements for Siri, indicating slow progress in AI that could impact user experience and market competitiveness.
- Product Showcase Announcement: Apple is set to host a 'special Apple Experience' on March 4 in New York, London, and Shanghai; while details remain undisclosed, the 3D Apple logo's colors have sparked speculation about a new low-cost MacBook, potentially drawing media and consumer interest.
- Increased Stock Pressure: Apple's stock fell 8% last week, marking its largest weekly decline since April last year, despite reporting record iPhone revenue in the latest quarter, indicating strong demand but overshadowed by a broader tech sell-off affecting its stock performance.
- Market Sentiment Shift: Retail sentiment for AAPL has remained in the 'bearish' zone over the past week, reflecting investor concerns about future performance, particularly ahead of new product launches, which may affect short-term market confidence.
See More
Apple Unveils Integrated Video Podcast Experience on Apple Podcasts
- Video Podcast Integration: Apple plans to launch a new integrated video podcast experience this spring, aiming to align more closely with competitors like Spotify, YouTube, and Netflix, thereby reinforcing its leadership in the podcast market.
- Creator Control: The new feature will empower creators to have full control over their content and business models while simplifying the process for audiences to listen to or watch podcasts, which is expected to attract more content creators to the platform.
- Advertising Market Opportunity: Creators can dynamically insert video ads, including host-read spots, unlocking access to a broader video advertising market and enhancing revenue potential while maintaining creative control.
- No Distribution Fees: Apple will not charge podcast hosting providers or creators for distribution, whether via traditional RSS/MP3 or HLS video, a strategy that will further entice creators to utilize the Apple Podcasts platform.
See More
Investor Fears of Bear Market Intensify
- Shift in Market Sentiment: Since 2022, investor fears of a bear market have intensified, with value, dividend, and international stocks emerging as leaders despite the S&P 500 being virtually flat in 2026, indicating a structural shift in market dynamics.
- Economic Growth Expectations: Concerns about the job market, affordability, and tariff impacts exist, yet expectations for GDP and earnings growth, along with stable inflation, have not raised urgent red flags for the markets, suggesting a wait-and-see approach.
- Investment Strategy Adjustments: Vanguard ETFs offer three strategies to mitigate potential bear market risks, including the Short-Term Treasury ETF (VGSH), which provides a 3.6% yield, ensuring a safe income stream while minimizing volatility.
- Defensive Equity Allocation: The Vanguard U.S. Minimum Volatility ETF (VFMV) helps investors reduce downside risk by investing in stocks expected to exhibit lower volatility, maintaining equity exposure while currently holding significant allocations in technology, industrials, consumer discretionary, and financials.
See More
Investment Opportunities in Hardware Stocks for the AI Revolution
- Data Center Infrastructure: Analyst Michael Del Monte recommends IESC and Vertiv as key investments in data center infrastructure, with IESC focusing on custom design of electrical and technology systems, while Vertiv provides integrated rack solutions and power management software, expected to benefit from rising AI demand.
- Memory and Bandwidth Bottlenecks: Kennedy Njagi highlights Micron Technology as crucial for AI training and inference workloads due to memory barriers limiting performance, and as supply tightens, Micron's market performance is set to significantly improve, making it a focal point for investors.
- Low-Risk Investment: Elizabeth Pramila views Apple's third-party strategy in AI hardware as reducing investment risks, particularly with its partnership with Alphabet for the Gemini rollout, indicating Apple's potential in AI adoption without the need for large capital expenditures.
- Long-Term Investment Opportunities: Analysts emphasize that true long-term investment opportunities lie with companies that not only manufacture AI hardware but also possess extensive delivery ecosystems, such as Apple, Amazon, and Alphabet, which can drive growth in AI capabilities through their devices and cloud infrastructure.
See More
Apple Introduces New Video Podcast Experience
- Video Podcast Integration: Apple announced it will launch an integrated video podcast experience in Spring 2024, aiming to enhance user experience and align with competitors like Spotify and YouTube, which is expected to attract more user engagement.
- Enhanced User Features: The new functionality allows users to seamlessly switch between watching and listening within the same show, supporting picture-in-picture mode and offline downloads, significantly improving user convenience and content consumption flexibility.
- Innovative Ad Insertion: The newly introduced HLS format supports dynamic video ad insertion, allowing content creators to insert ads through participating ad networks, and while Apple will not charge creators for distribution, it will impose impression-based fees on ad networks, potentially generating new revenue streams for the company.
- Intensifying Market Competition: As platforms like YouTube and Spotify continue to invest in video podcasting, Apple's initiative not only responds to market trends but may also impact revenue growth in its Services segment, which generated $30 billion in the most recent quarter.
See More
Apple Reports Strong Q1 Growth Amid Challenges
- Significant Revenue Growth: Apple reported a 15.7% year-over-year revenue increase in Q1 2026 (ending December 27), primarily driven by robust demand for the iPhone 17 lineup, showcasing its sustained leadership in the smartphone market.
- iPhone Sales Surge: iPhone sales rose 23.4% year-over-year, further solidifying Apple's market dominance in hardware, indicating strong consumer preference and brand loyalty.
- Exceptional Profit Margins: The company's net income margin reached 29.3% in the last fiscal quarter, reflecting its outstanding profitability and pricing power, despite facing regulatory scrutiny and delays in Siri updates.
- Cautious Market Outlook: While Apple's P/E ratio stands at 33.1, indicating a premium valuation, investor concerns about its cautious approach in the AI race may lead to underperformance compared to the broader market over the next five years.
See More
Apple Releases iOS 26.4 Beta and Announces Product Showcase
- New System Release: Apple launched the iOS 26.4 beta on Monday, introducing features like video podcasts and an Apple Music playlist tool, but lacking enhancements for Siri, indicating slow progress in AI that could impact user experience and market competitiveness.
- Product Showcase Announcement: Apple is set to host a 'special Apple Experience' on March 4 in New York, London, and Shanghai; while details remain undisclosed, the 3D Apple logo's colors have sparked speculation about a new low-cost MacBook, potentially drawing media and consumer interest.
- Increased Stock Pressure: Apple's stock fell 8% last week, marking its largest weekly decline since April last year, despite reporting record iPhone revenue in the latest quarter, indicating strong demand but overshadowed by a broader tech sell-off affecting its stock performance.
- Market Sentiment Shift: Retail sentiment for AAPL has remained in the 'bearish' zone over the past week, reflecting investor concerns about future performance, particularly ahead of new product launches, which may affect short-term market confidence.
See More
Apple Unveils Integrated Video Podcast Experience on Apple Podcasts
- Video Podcast Integration: Apple plans to launch a new integrated video podcast experience this spring, aiming to align more closely with competitors like Spotify, YouTube, and Netflix, thereby reinforcing its leadership in the podcast market.
- Creator Control: The new feature will empower creators to have full control over their content and business models while simplifying the process for audiences to listen to or watch podcasts, which is expected to attract more content creators to the platform.
- Advertising Market Opportunity: Creators can dynamically insert video ads, including host-read spots, unlocking access to a broader video advertising market and enhancing revenue potential while maintaining creative control.
- No Distribution Fees: Apple will not charge podcast hosting providers or creators for distribution, whether via traditional RSS/MP3 or HLS video, a strategy that will further entice creators to utilize the Apple Podcasts platform.
See More
Investor Fears of Bear Market Intensify
- Shift in Market Sentiment: Since 2022, investor fears of a bear market have intensified, with value, dividend, and international stocks emerging as leaders despite the S&P 500 being virtually flat in 2026, indicating a structural shift in market dynamics.
- Economic Growth Expectations: Concerns about the job market, affordability, and tariff impacts exist, yet expectations for GDP and earnings growth, along with stable inflation, have not raised urgent red flags for the markets, suggesting a wait-and-see approach.
- Investment Strategy Adjustments: Vanguard ETFs offer three strategies to mitigate potential bear market risks, including the Short-Term Treasury ETF (VGSH), which provides a 3.6% yield, ensuring a safe income stream while minimizing volatility.
- Defensive Equity Allocation: The Vanguard U.S. Minimum Volatility ETF (VFMV) helps investors reduce downside risk by investing in stocks expected to exhibit lower volatility, maintaining equity exposure while currently holding significant allocations in technology, industrials, consumer discretionary, and financials.
See More
Investment Opportunities in Hardware Stocks for the AI Revolution
- Data Center Infrastructure: Analyst Michael Del Monte recommends IESC and Vertiv as key investments in data center infrastructure, with IESC focusing on custom design of electrical and technology systems, while Vertiv provides integrated rack solutions and power management software, expected to benefit from rising AI demand.
- Memory and Bandwidth Bottlenecks: Kennedy Njagi highlights Micron Technology as crucial for AI training and inference workloads due to memory barriers limiting performance, and as supply tightens, Micron's market performance is set to significantly improve, making it a focal point for investors.
- Low-Risk Investment: Elizabeth Pramila views Apple's third-party strategy in AI hardware as reducing investment risks, particularly with its partnership with Alphabet for the Gemini rollout, indicating Apple's potential in AI adoption without the need for large capital expenditures.
- Long-Term Investment Opportunities: Analysts emphasize that true long-term investment opportunities lie with companies that not only manufacture AI hardware but also possess extensive delivery ecosystems, such as Apple, Amazon, and Alphabet, which can drive growth in AI capabilities through their devices and cloud infrastructure.
See More
Apple Introduces New Video Podcast Experience
- Video Podcast Integration: Apple announced it will launch an integrated video podcast experience in Spring 2024, aiming to enhance user experience and align with competitors like Spotify and YouTube, which is expected to attract more user engagement.
- Enhanced User Features: The new functionality allows users to seamlessly switch between watching and listening within the same show, supporting picture-in-picture mode and offline downloads, significantly improving user convenience and content consumption flexibility.
- Innovative Ad Insertion: The newly introduced HLS format supports dynamic video ad insertion, allowing content creators to insert ads through participating ad networks, and while Apple will not charge creators for distribution, it will impose impression-based fees on ad networks, potentially generating new revenue streams for the company.
- Intensifying Market Competition: As platforms like YouTube and Spotify continue to invest in video podcasting, Apple's initiative not only responds to market trends but may also impact revenue growth in its Services segment, which generated $30 billion in the most recent quarter.
See More
