Apple (AAPL) is once again at the center of institutional investors’ portfolio rebalancing. From George Soros to BlackRock (BLK) and Vanguard, some of the biggest players on Wall Street have increased their exposure to the iPhone maker in recent weeks. However, some high-profile investors, such as Warren Buffett and Ray Dalio, have also reduced their stakes in the tech giant. The question is, will 2026 be the year investors should bet more on Apple stock? The macroeconomic environment is also adding to the intrigue, as the tech sector — comprised of the largest-cap tech companies — is a major contributor to the broader market’s performance.
Apple is also one of the largest components of popular exchange-traded funds (ETFs) such as the Invesco QQQ Trust (QQQ) and the Technology Select Sector SPDR Fund (XLK). As Apple’s shares are trading near $274, just below their 52-week high of $288.62, investors are trying to determine whether the fundamentals justify the premium valuation.
About Apple Stock
Apple is a technology powerhouse based in Cupertino, California, that designs, manufactures, and sells consumer electronics such as smartphones, wearables, personal computers, and online services. Apple has a market capitalization of approximately $3.9 trillion, making it one of the largest publicly traded companies in the world by market cap, as well as one of the largest tech companies globally.
Apple’s 52-week range is between $169.21 and $288.62. AAPL stock has increased by 11% over the last year, and its performance relative to the S&P 500 ($SPX) has been relatively good yet unexplosive, which is more a function of the company’s maturity rather than stagnation.
From a valuation perspective, the stock is trading at a trailing price-to-earnings (P/E) ratio of 33.6 times and a forward P/E of 31.6 times. AAPL also has a price-to-sales (P/S) ratio of 9.39, a price-to-cash flow ratio of 31.7, and a relatively high profit margin of 26.92% coupled with a return on equity of 159.94%, making the stock more appealing to investors. The balance sheet also reflects a relatively lower debt-to-equity ratio of 1.03, along with a high interest coverage ratio of 5.81, indicating that Apple is financially healthy.
Apple is not only paying out its earnings to the shareholders, but the company is also repurchasing shares, thereby returning more value to investors. Apple recently paid a quarterly dividend of $0.26 per share on Feb. 12 to the shareholders of record as of Feb. 9.
Apple Beats on Earnings
Apple reported its first-quarter fiscal 2026 results on Jan. 29, and they were nothing short of record-breaking. Apple reported revenue of $143.8 billion, up 16% year-over-year (YOY), while diluted EPS came at $2.84, up 19% YOY. Both revenue and EPS were all-time highs, reflecting the high demand for the company’s products. The iPhone segment reported the best quarter ever, while the company reported “all-time records across every geographic segment.” Services revenue also reported a new high, increasing 14% YOY. The company now has an active installed base of more than 2.5 billion devices, which is a very important metric as it is a driver of the company’s services revenue.
Apple earned a significant amount of operating cash flow — almost $54 billion during the quarter — while the company returned almost $32 billion to its shareholders. This is the reason why many institutions are heavily invested in the company. BlackRock now owns 1.15 billion shares of AAPL stock worth $313.91 billion, making up 5.31% of its portfolio. On the other hand, Vanguard owns 1.43 billion shares worth $387.75 billion, making up 5.62% of its holdings. Finally, in contrast, Soros Fund Management boosted its holdings by 19% to more than 416,239 shares.
What Do Analysts Expect for Apple Stock?
Wall Street analysts are generally bullish on Apple shares with a “Moderate Buy” consensus rating. The high target price for AAPL stock is $350, the low target price is $230, and the mean price target is $293.48. That mean price target represents potential upside of almost 7% from current levels. Although not spectacular, the possible upside comes on the back of a massive market cap and a strong cash flow.
On the date of publication, Yiannis Zourmpanos did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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