Apple(NASDAQ: AAPL) remains a top technology stock at Wedbush Securities despite worrisome results in its China business. Analyst Dan Ives dismissed those concerns as noise and recently said Apple will become the first $4 trillion company by the end of 2024. That prediction implies 40% upside from its current market capitalization of $2.85 trillion.
Ives provided additional commentary in a note to clients: “With roughly 240 million iPhones in the window of an upgrade opportunity globally now at play for iPhone 15, and services reaccelerating into [fiscal year 2024], we view this as a golden opportunity to own Apple for the next year.”
Here’s what investors should know.
Apple worried investors with declining sales in China and a weak outlook
Apple reported better-than-expected financial results for the first quarter of fiscal 2024, which ended Dec. 30, 2023. Revenue rose 2% to $119.5 billion on a modest uptick in iPhone sales and more robust growth in services revenue. Management highlighted advertising, video, and cloud services as major contributors to that momentum.
Apple earns higher margins on services than hardware, so the company has become more profitable over time as its services business has scaled. That trend continued in the first quarter. Gross margin expanded 290 basis points and GAAP earnings jumped 16% to $2.18 per diluted share. Stock buybacks also contributed to rapid bottom-line growth.
The chart below provides a more detailed look at Apple’s revenue growth in the first quarter.
Chart by Author. Shown above is Apple’s revenue across all five business segments in the first quarter of fiscal 2024 (ended Dec. 30, 2023).
Despite strong results, Apple shares slid about 4% following the report for two reasons. First, sales declined 13% in China, fueling concern that the company is losing share to domestic competitors like Huawei and Xiaomi. Jeffries analysts estimate that iPhone sales fell 30% in China during the first week of 2024. That is a pressing concern because China is Apple’s third-largest market and represents one-sixth of total revenue.
Second, while Apple did not provide formal guidance, management implied that revenue would fall about 5% in the second quarter. CFO Luca Maestri attributed that weak outlook to the absence of certain tailwinds. Specifically, Apple benefited from pent-up iPhone demand in the second quarter of last year because factory closures had previously limited production.
Apple is a consumer electronics leader with growth opportunities in services
Apple has a strong presence in several corners of the consumer electronics market. Its leadership in smartphones (as measured by revenue and shipments) is the foundation of its business. But the tech titan also enjoys a dominant position in the tablet and smartwatch markets, and it’s one of the largest personal computer vendors. That success is built on brand authority and engineering expertise.
Specifically, Apple pairs premium hardware (including custom chips) with proprietary software and services to create a compelling user experience. And while the iPhone is the center of that ecosystem, adjacent products like Macs and AirPods make the ecosystem stickier. Those qualities grant Apple substantial pricing power. The average iPhone costs twice as much as the average Android smartphone, according to Insider Intelligence.
That pricing power allows Apple to invest heavily in research and development. The company recently launched its first mixed-reality device, the Apple Vision Pro, a product some pundits believe will eventually replace the iPad.
Apple’s installed base surpassed 2.2 billion devices in the first quarter. The company monetizes those consumers once with the initial purchase, but it aims to monetize them continuously thereafter with its services business. For instance, Apple earns services revenue on App Store fees and related advertising, iCloud storage, and financial products like Apple Pay, among other subscription products.
The company has a strong position in a few of those categories. The Apple App Store leads the mobile application market in revenue; Apple is the fifth-fastest-growing digital advertising company in the U.S.; and Apple Pay is the most popular in-store mobile wallet among U.S. consumers.
Apple shares trade at an expensive valuation compared to big tech peers
To create shareholder value, Apple needs to maintain its strong position in smartphones and continue to grow its services business. The company must also stay current on nascent technologies like virtual reality and augmented reality. Products that incorporate those technologies could be the next big thing in consumer electronics. If Apple falls behind, it may be displaced in the same way the iPhone displaced products from Nokia and BlackBerry.
Whether Apple reaches $4 trillion in 2024 is a coin toss. Investors interested in buying the stock should plan on holding it for three to five years at a minimum. Personally, I doubt Apple can deliver market-beating returns during that period. Its current valuation of 29 times earnings looks expensive compared to the long-term earnings growth of 9.4% annually that Wall Street expects.
Taken together, those values produce a PEG ratio of 3.1 for Apple. For context, Alphabet has a PEG ratio of 1.5, Amazon sports a PEG ratio of 2.3, and Microsoft has a PEG ratio of 2.5. That means Apple is more expensive than its big tech peers.
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TORONTO – Canada’s main stock index was up more than 250 points in late-morning trading, led by strength in the base metal and technology sectors, while U.S. stock markets also charged higher.
The S&P/TSX composite index was up 254.62 points at 23,847.22.
In New York, the Dow Jones industrial average was up 432.77 points at 41,935.87. The S&P 500 index was up 96.38 points at 5,714.64, while the Nasdaq composite was up 486.12 points at 18,059.42.
The Canadian dollar traded for 73.68 cents US compared with 73.58 cents US on Thursday.
The November crude oil contract was up 89 cents at US$70.77 per barrel and the October natural gas contract was down a penny at US2.27 per mmBTU.
The December gold contract was up US$9.40 at US$2,608.00 an ounce and the December copper contract was up four cents at US$4.33 a pound.
This report by The Canadian Press was first published Sept. 19, 2024.
Losing a loved one is never easy, and the legal steps that follow can add even more stress to an already difficult time.
For years, families in Vancouver (and Canada in general) have struggled with a complex probate process—filled with paperwork and legal challenges.
Thankfully, recent changes to Canada’s probate laws aim to make this process simpler and easier to navigate.
Let’s unearth how these updates can simplify the process for you and your family.
What is probate?
Probate might sound complicated, but it’s simply the legal process of settling someone’s estate after death.
Here’s how it works.
Validating the will. The court checks if the will is legal and valid.
Appointing an executor. If named in the will, the executor manages the estate. If not, the court appoints someone.
Settling debts and taxes. The executor (and you) pays debts and taxes before anything can be given.
Distributing the estate. Once everything is settled, the executor distributes the remaining assets according to the will or legal rules.
Probate ensures everything is done by the book, giving you peace of mind during a difficult time.
Recent Changes in Canadian Probate Laws
Several updates to probate law in the country are making the process smoother for you and your family.
Here’s a closer look at the fundamental changes that are making a real difference.
1) Virtual witnessing of wills
Now permanent in many provinces, including British Columbia, wills can be signed and witnessed remotely through video calls.
Such a change makes estate planning more accessible, especially for those in remote areas or with limited mobility.
2) Simplified process for small estates
Smaller estates, like those under 25,000 CAD in BC, now have a faster, simplified probate process.
Fewer forms and legal steps mean less hassle for families handling modest estates.
3) Substantial compliance for wills
Courts can now approve wills with minor errors if they reflect the person’s true intentions.
This update prevents unnecessary legal challenges and ensures the deceased’s wishes are respected.
These changes help make probate less stressful and more efficient for you and other families across Canada.
The Probate Process and You: The Role of a Probate Lawyer
(Image: Freepik.com)
Working with a probate lawyer in Vancouver can significantly simplify the probate process, especially given the city’s complex legal landscape.
Here’s how they can help.
Navigating the legal process
Probate lawyers ensure all legal steps are followed, preventing costly mistakes and ensuring the estate is managed properly.
Handling paperwork and deadlines
They manage all the paperwork and court deadlines, taking the burden off of you during this difficult time.
Resolving disputes
If conflicts arise, probate lawyers resolve them, avoiding legal battles.
Providing you peace of mind
With a probate lawyer’s expertise, you can trust that the estate is being handled efficiently and according to the law.
With a skilled probate lawyer, you can ensure the entire process is smooth and stress-free.
Why These Changes Matter
The updates to probate law make a big difference for Canadian families. Here’s why.
Less stress for you. Simplified processes mean you can focus on grieving, not paperwork.
Faster estate settlements. Estates are settled more quickly, so beneficiaries don’t face long delays.
Fewer disputes. Courts can now honor will with minor errors, reducing family conflicts.
Accessible for everyone. Virtual witnessing and easier rules for small estates make probate more accessible for everyone, no matter where you live.
With these changes, probate becomes smoother and more manageable for you and your family.
How to Prepare for the Probate Process
Even with the recent changes, being prepared makes probate smoother. Here are a few steps to help you prepare.
Create a will. Ensure a valid will is in place to avoid complications.
Choose an executor. Pick someone responsible for managing the estate and discuss their role with them.
Organize documents. Keep key financial and legal documents in one place for easy access.
Talk to your family. Have open conversations with your family to prevent future misunderstandings.
Get legal advice. Consult with a probate lawyer to ensure everything is legally sound and up-to-date.
These simple steps make the probate process easier for everyone involved.
Wrapping Up: Making Probate Easier in Vancouver
Recent updates in probate law are simplifying the process for families, from virtual witnessing to easier estate rules. These reforms are designed to ease the burden, helping you focus on what matters—grieving and respecting your dead loved ones’ final wishes.
Despite these changes, it’s best to consult a probate lawyer to ensure you can manage everything properly. Remember, they’re here to help you during this difficult time.
TORONTO – Canada’s main stock index was higher in late-morning trading, helped by strength in energy stocks, while U.S. stock markets also moved up.
The S&P/TSX composite index was up 34.91 points at 23,736.98.
In New York, the Dow Jones industrial average was up 178.05 points at 41,800.13. The S&P 500 index was up 28.38 points at 5,661.47, while the Nasdaq composite was up 133.17 points at 17,725.30.
The Canadian dollar traded for 73.56 cents US compared with 73.57 cents US on Monday.
The November crude oil contract was up 68 cents at US$69.70 per barrel and the October natural gas contract was up three cents at US$2.40 per mmBTU.
The December gold contract was down US$7.80 at US$2,601.10 an ounce and the December copper contract was up a penny at US$4.28 a pound.
This report by The Canadian Press was first published Sept. 17, 2024.
