Key Points
Apple CEO Tim Cook will host his final earnings conference call on Thursday, July 30. Under Cook’s leadership, Apple has become the largest company in the world, boasting a market capitalization of $5 trillion. As he prepares to step down, analysts are questioning whether Apple stock remains a viable investment.
In the upcoming fiscal third-quarter results, Apple is expected to report a 3% increase in iPhone shipments, marking its highest-ever global market share at 20%. The company’s service revenue also continues to grow at a mid-teen rate. Despite these strong fundamentals, Apple’s stock has a forward price-to-earnings (P/E) ratio exceeding 35, making it more expensive than pre-pandemic levels.
Tim Cook will be succeeded by John Ternus, who will inherit a solid revenue trajectory partly due to recent price increases on devices and services. However, concerns about future margin pressures from rising memory prices persist, leading to a cautious outlook on stock purchases at current valuation levels.
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