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.
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.