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Apple iPhone Revenue Up 66%, Mac Up 70%, iPad Up 79%

September 29, 2021 / By /
Stock (Symbol)

Apple (AAPL)
Stock Price

$130
Sector
Technology
Data is as of
June 16, 2020
Expected to Report
July 28
Company Description
Apple’s products and services include iPhone, iPad, Mac, iPod, Apple TV, a portfolio of consumer and professional software applications, the iOS and OS X operating systems, iCloud, and a variety of accessory, service and support offerings. The Company also sells and delivers digital content and applications through the iTunes Store, App StoreSM, iBookstoreSM, and Mac App Store. Source: Thomson Financial
Sharek’s Take
David SharekApple (AAPL) delivered stupendous results last qtr with iPhone revenue up 66%, with Mac up 70%, and iPad up 79%. Overall, profits jumped 119% from the year-ago period, as revenue soared 54%. Last qtr’s results were truly amazing. But results were impacted by rather flat results from the year-ago-period when overall revenue increased just 1% due to COVID restrictions on retail stores. Each geographic segment achieved record revenue last qtr, with each rising at least 35% (including an All-Time record in Japan). Here’s some AAPL stats from last qtr:

  • iPhone (54% of total company revenue):+66% sales growth.
    Sales were higher due to the successful launch and high demand of the company’s new iPhone 12 a qtr earlier. The new phone sports incredible color, faster load times, increased durability and  the iPhone Pro has a new depth sensor that produces 3d-like images, which you can check out here.
  • Services revenue (19% of sales): +27% year-over-year growth.
    Apple Services include: Apple Pay, Apple Music, iTunes and the App Store. New service offerings include Apple TV+, Apple Arcade, Apple News+, Apple Card, Apple Fitness+ and the Apple One bundle.
  • Wearables, Home and Accessories (9% of total sales): +25% growth. 
    Wearables include Apple Watch, AirPods and Beats products. This division was led by Apple Watch Series 6 and Apple Watch SE. The new Apple Watch Series 6 has powerful new health and wellness features including a blood oxygen sensor. Next up, the next-generation Apple TV 4K and Apple’s newest accessory AirTag, a tracking device that can act like a key finder, car finder, or spouse finder.
  • iPad revenue (9% of AAPL sales): +79% revenue growth.
    Revenue growth was attributed to iPad Air and the 10-inch version of iPad.
  • Mac (10% of company sales): +70% growth.
    Sales were robust due to higher sales of MacBook Air and MacBook Pro. The last three qtrs for Mac have been the best qtrs ever.

Apple stock has been basing since last December. That’s good, because with this exceptional profit growth, the stock is primed to make a run higher. The stock has an Estimated Long-Term Growth Rate of 18% a year, in addition to a yield of less than 1%. And with a P/E of 25, the shares are reasonable. My Fair Value on this $130 stock is $166. Management also buys back billions in stock. During the past two years (2018-2020) shares outstanding have decreased from 20 billion to 17.5 billion. The board of directors just increased the dividend 7% and bumped up the stock buyback program by $90 billion. AAPL is part of the Conservative Growth Portfolio. With excellent profit growth expected the next 2 qtrs, the stock could be ready to run higher.
One Year Chart
AAPL seems to be coiled up and ready to make a run to All-Time highs. The company is also is in the midst of a nice string of qtrly profit growth. I really like the 52% profit growth Estimates for the next two qtrs.

The P/E of 25 is very reasonable. The P/E was 28 last qtr. I think the P/E should be 32.

The Est. LTG of 18% is up from 15% last qtr and 13% two qtrs ago. This is a very good one-year chart. The best Apple one I’ve seen in a while.
Earnings Table
Last qtr AAPL delivered 119% profit growth and beat estimates of 53%. Revenue surged 54%. The iPhone 12 was released on October 23 of last year, which was 2QtrsAgo.

Annual Profit Estimates increased across the board. But analysts don’t anticipate much growth in the next two years (3% and 4%).

Qtrly profit Estimates are for 52%, 22%, 8% and -13% growth the next 4 qtrs. Note the 4QtrsOut estimate needs time to adjust as the company just beat the street and “last year’s comparison” will be the qtr it just reported.
Fair Value
The median P/E was 12 to 13 during fiscal years 2011-2016 and then was 16-17 during 2017-2019. Then last year the P/E median jumped to 29. The higher valuation (P/E) was the main reason why AAPL was such a hot stock from 2019 to 2020.

I feel this stock is worthy of a 32 P/E, which equates to $166 a share this year (+28%) and $171 next year (+32%). AAPL has its fiscal year-end in September, so next qtr I will start looking at 2020 estimates.
Bottom Line
Apple (AAPL) has had a good decade. Notice profits only grew 16% during the decade while the stock went up 26% a year. The boost for the stock was from the P/E’s jump from 13 to 28.

These figures were fantastic. IPhone, iPad and Mac all had sales jumped greater than 65%. And yes, a year ago business was flat due to COVID, but these are some seriously good numbers. And the P/E is just 25.

AAPL moves up from 12th to 6th in the Conservative Growth Portfolio Power Rankings. I will increase my position today. Alphabet, Amazon, Facebook and Apple are all within the top 6 of this portfolio’s Power Rankings.
 Power Rankings
Growth Stock Portfolio

N/A

Aggressive Growth Portfolio

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Conservative Stock Portfolio

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