Apple Is the 'Mack Daddy' of Tech, Says Longtime Bull Who Defends Its Steep Valuation
Key takeaways
- Apple’s earnings beat was offset by memory‑cost worries and a steep valuation, sending the stock lower in pre‑market trade.
- Revenue $114.48 billion
- $2.10
EPS
Earnings per share — profit for one share of the company, in dollars.
- Product revenue $82.90 billion
What happened
Apple Inc. (NASDAQ: AAPL) reported fiscal fourth‑quarter revenue of $114.48 billion and earnings of $2.10 per share, beating estimates. The company warned that memory costs could rise beyond the December quarter, and services growth was slower than expected. Despite the strong results, Apple shares fell more than 4% in pre‑market trading.
Why it matters
The earnings beat shows Apple’s core business remains healthy, but the memory‑cost warning signals potential margin pressure. Analysts noted that the company’s valuation—about 35–36 times forward earnings—leaves little room for upside if costs rise. The drop reflects investors’ concern that the premium price may not…
Short-term and longer-term
Short-term. In the next few days, watch for the $345 resistance and the 20‑day SMA at $342.35.
Longer-term. Over the coming months, Apple’s ability to grow services and AI revenue while managing memory costs will test the premium valuation.
Words on this card
- SMA
- Simple moving average, a trend indicator that averages a stock’s price over a set number of days.
- RSI
- Relative Strength Index, a momentum oscillator that measures the speed and change of price movements.
- Earnings per share (EPS)
- Net income divided by the number of outstanding shares, indicating profitability per share.
- Forward earnings
- Projected earnings for the next fiscal year, used to calculate valuation multiples.
- AI services
- Revenue generated from artificial intelligence features and offerings within Apple’s ecosystem.
- Revenue
- Sales — money the company took in before costs.