Apple Stock Price Surge: Is it Still a Buy?

Apple is a stock that has grown incredibly over the past decade. Should investors still buy it today?

| More on:
question marks written reminders tickets

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn more

If you’re invested in the stock market, there’s a fairly good chance you’ve looked at Apple (NASDAQ:AAPL) stock at least once in your life. If you didn’t notice, it’s the largest company in the world when ranked by market cap. Valued at US$2.8 trillion, it seems as though we could see the first $3 trillion company before the end of the year.

Investors often use a company’s market cap to determine whether it still has room to grow. After all, that’s why small-cap stocks are so fascinating. Even though Apple is the largest company in the world, here’s why you should consider buying it today.

An apple a day keeps the doctor away

When I think of Apple stock, I often think of the phrase, “an apple a day keeps the doctor away.” It’s a bit silly, but I think it works in this case. That phrase implies that an individual who eats healthy food on a regular basis will remain in good health. I believe that if you consistently add Apple stock to your portfolio, your financial well-being will remain in good health.

Apple stock has done very well over the years. Over the past five years, the stock has gained more than 500%. And despite its formidable size, the stock has shown no signs of slowing down. Apple stock has gained more than 35% this year alone! When Apple’s valuation hit $1 trillion in 2018, investors thought the end was near. They said the same thing at $2 trillion. Now, it’s knocking on $3 trillion’s door. When is everyone going to take the hint? This stock can’t be stopped.

Why is Apple such a good company to invest in?

Apple is one of the most well-known companies in the world. I’d argue that if you went outside right now, it wouldn’t be long before you see an Apple product.

In addition to its well-known consumer tech items, Apple has managed to expand into user experience products like music and video streaming. Apple also hopes to bring new and innovative technology to market in the future. For example, the company is working on Augmented Reality glasses, and investors and Apple fans alike haven’t exactly given up hopes on an Apple car. If either of those products comes to fruition, it could be tremendous news for Apple stock.

When thinking about what makes a good company to invest in, here are some questions you should contemplate. Does the company lead an important industry? Does the company have a strong brand presence? Does the stock have a history of market outperformance and strong growth? Do investors believe the stock is overvalued? Wise Motley Fool readers will recognize that those questions are bullet points in Motley Fool co-founder David Gardner’s list of “what makes a rule breaker?” All of those questions can be answered as yes in Apple’s case.

Foolish takeaway

Ever since Apple stock hit a $1 trillion market cap, it has continued to soar. Moving swiftly past $2 trillion and rapidly approaching $3 trillion, investors wonder whether it’s still a good idea to buy Apple stock. I argue that it’s one of the most recognizable brands for a reason. Strong brand awareness and new product offerings will carry Apple stock much further. If you’re ever out of ideas for stocks to buy, consider Apple.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Jed Lloren owns Apple. The Motley Fool recommends Apple.

More on Investing

Electricity high voltage pole and sky
Dividend Stocks

2 High-Dividend TSX Utilities Stocks to Buy Today

The TSX utility sector has some great high-yield stocks to buy.

Read more »

A close up image of Canadian $20 Dollar bills

Canadians: A Top Passive Investment for Big Passive Income

BMO Canadian High Dividend Covered Call ETF (TSX:ZWC) is a top passive-income play for Canadians to buy on recent weakness.

Read more »

Retirement plan
Dividend Stocks

Retirement Planning: Now Is the Time to Buy Dividend Stocks

2022 could be a great time to buy quality dividend stocks at attractive discounts. Prioritize your capital allocation now.

Read more »

Payday ringed on a calendar
Dividend Stocks

How to Convert $500 Monthly Investment Into $200 Monthly Income

If you want the stock market to give you regular monthly income, you have to invest in the stock market…

Read more »

falling red arrow and lifting

RRSP Investors: 3 Dividend Stocks to Buy on the Dip

Inflation has delayed retirement for Canadians. RRSP investors should buy cheap dividend stocks like Fortis Inc. (TSX:FTS)(NYSE:FTS).

Read more »

Growth from coins
Tech Stocks

Got $1,000? Buy These 3 Under-$20 Growth Stocks to Earn Higher Returns

These under-$20 growth stocks can deliver solid returns in the long run.

Read more »

worry concern
Dividend Stocks

3 Ultra-Safe Dividend Stocks for Jittery Investors

Motley Fool investors nervous about the market downturn should consider these ultra-safe dividend stocks that keep paying passive income no…

Read more »

Economic Turbulence

The TSX’s 1st Crypto ETF Lost $500 Million in 1 Day

The TSX’s first crypto ETF lost $500 million is one day and is down nearly 58% year to date.

Read more »