Apple Stock Could Be The Market’s Most Valuable Stock This Earnings Season

April 27, 2022 at 12:38 PM EDT

While the Nasdaq 100 Technology Sector index, fell by 25% YTD, Apple stock are down only 10%.

Investors wait with excitement Apple’s fiscal 2022 first-quarter earnings for three months ending March 26th, which will be on April 28th, to boost the stock. So let’s take a look at what Apple has in store for Q2 and why it appears to be on track for another fantastic quarter.

Apple (NASDAQ: AAPL) chose not to give formal guidance in January’s fiscal first-quarter results due to “continuing uncertainty across the globe” in the short term. Luca Maestri, Apple’s CFO, did, however, mention on its January results conference call that Apple could achieve “good year-over-year growth” and set a record for March quarter revenue despite severe supply restrictions.

Maestri added that supply chain restrictions in the March quarter would be less severe than in the fiscal 1st quarter. As a result, apple’s fiscal Q2 sales are expected to exceed $94 billion. That is a 5% increase over the record-setting $89.6 million in December.

The year-over-year growth might seem a little small at first glance. Due to high demand, the introduction of the iPhone 12’s Q1 fiscal 2020 (which ended in December 2020) was delayed. However, the gadget continued to be popular into the second quarter (March 2021). Apple’s fiscal year 2021 fourth-quarter release of the iPhone 13 models has made it more challenging to compare year-over-year results.

Apple Stock Forecast

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Wall Street projections are expected to be exceeded by Apple, so it shouldn’t be a surprise that this is the case. According to Morgan Stanley analyst Katy Huberty, a 10% increase in iPhone shipments will be caused by solid demand for the iPhone 13-series. Apple shipped approximately 66 million iPhones last year when it delivered 60 million iPhones.

Huberty also increased her iPhone ASP forecast from $848 to $878, a significant rise. A better sales mix could explain Apple’s increase in iPhone ASP. Huberty reports that Apple’s iPhone 13 accounted for 69 percent and the iPhone 12 series for 16 percent of its smartphone sales. According to Huberty, Apple’s iPhone sales accounted for 85 percent of 5G devices in the last quarter. The company’s bottom line and top should have benefited because it has a lot to do with 5G smartphone prices.

Huberty’s projection ASP shows iPhone sales of $58 Billion for the second quarter. That is 21% more than the iPhone’s revenue of $47.9 Billion in the previous year. In addition, apple’s iPhone accounted for 58 percent of total company sales in the first quarter of 2022. That suggests that a strong performance by this product line could help the company achieve higher-than-expected results.

Profits of $1.43 per stock are expected by shareholders, a slight increase from the $1.40 per stock reported in the quarter last year. Apple’s bottom line will grow due to increased volume and improved pricing. However, Apple’s stock price will fall.

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