Could Apple soon become a trillion dollar company?

Notebook sales are up, the iPhone 8 is already poised for a massive success, the App store is having it’s most blockbuster year ever, and Apple is working on fully automated self-driving cars. So is there a possibility that Apple could soon become a trillion dollar company? RBC Capital Markets analyst Amit Daryanani says the answer is yes, and it could even happen in the next 18 months.

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An excerpt found on Marcumors of Daryanani’s research note, edited slightly for clarity:

In aggregate, we see a scenario where in the 2019 fiscal year, Apple sustains $12+ earnings per share and, assuming the valuation frameworks remains stable/improves, it should get AAPL stock toward $192–$195, which would equate to a market cap above $1 trillion.

Another major driving force in Amit’s calculation is the fact that Apple’s ability to be a service provider at their retail stores is widespread and improving. In other words, they’re in the business of fixing iPhones, iPads, Macbooks and more through their retail locations. So what does that mean for computer and cell phone repair companies like Zombie Techs? Companies like ours are part of a larger web of computer and cell phone repair companies that find their way into nature as an alternative to what the big boxes offer and we fill in the last leg of business that they cannot provide their customers due to the nature of complexity surrounding their gadgets. Though Apple is taking on a lot of iPhones and iPads for repair in their retail store locations, many customers are still coming through our doors reporting a laundry list of problems. Among them are:

  • long wait times
  • difficulty in scheduling appointments at the Apple store
  • customers are told to buy new Macbooks, iPads, and iPhones instead of fixing them
  • Macbooks, iPads, and iPhones are being consistently mis-diagnosed by staff
  • problems are not resolved on the first try and the turn around times are extremely long, even for repeat or redo work.

All of that said, Apple’s service category income stream came to a whopping $7.17 billion dollars in revenue just in the last quarter alone. That’s up from $6 billion last year according to an article at Macrumors.

Amit goes on to say:

Longer-term, we think there is potential for Apple to continue growing Services revenue by double digit year-over-year given the company’s expanding installed base [of devices], increasing App Store sales within the current installed base, demand for cloud storage/compute services, and further adoption of Apple Pay.

Apple is also turning heads in the stock market in unprecedented levels of success. Apple’s market-cap climbed over the 800 billion mark recently and for the first time ever. Shares are up by over $25 from a year ago and investors keep piling in anticipating the release and success of the iPhone 8. There are many analysts who still tout Apple as a gold mine and even those who say it is among some of the most under appreciated stocks in the market today.

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