Here’s why Warren Buffett and Jim Cramer think Apple stock is the best (2024)

FAQs

What does Cramer say about Apple? ›

Jim Cramer reasserts his bullish stance on Apple, says it doesn't need to chase enterprise customers. CNBC's Jim Cramer explained that Apple does well to focus on its key demographic — the consumer.

Just three years ago, Buffett proclaimed that Apple was "probably the best business I know in the world" during an interview on CNBC.

AAPL has been an exceptional investment. Since its IPO over 40 years ago, it has generated an exceptional return. In the past five years alone, AAPL has increased by 320%. The iPhone is at the heart of Apple's sales.

Almost half of the total portfolio

It owns nearly 790 million shares of Apple stock, or a 5.1% stake in the company. Buffett recently grouped Apple together with American Express and Coca-Cola as stocks he plans to hold forever.

On Monday evening, Musk wrote on his social media platform X that adding OpenAI's tech into Apple's systems "is an unacceptable security violation." He added that visitors to his businesses, which also include SpaceX, "will have to check their Apple devices at the door, where they will be stored in a Faraday cage."

The tech giant's spot for the iPad Pro depicts items used to make art, like a record player, paint cans, a piano, a trumpet, and a sculpted bust, being compressed into bits by a hydraulic crusher. The reaction to the spot has ranged from it being called a sign of a "dystopian future" to "ghoulish and tone-deaf."

Largest shareholders include Vanguard Group Inc, BlackRock Inc., Berkshire Hathaway Inc, State Street Corp, VTSMX - Vanguard Total Stock Market Index Fund Investor Shares, VFINX - Vanguard 500 Index Fund Investor Shares, Geode Capital Management, Llc, Fmr Llc, Morgan Stanley, and Price T Rowe Associates Inc /md/ .

Buffett began buying Apple in the first quarter of 2016, but there's no way to know exactly what his average share price was. But if you use the highest closing that quarter as a conservative estimate, it means that you would have paid $27.06 per share for Apple.

So, why did Buffett sell? In a word: taxes. Buffett thinks paying taxes now on the massive capital gain for Berkshire's Apple shares is a smart move. "We are paying a 21% federal rate on the gains we're taking on Apple.

Analysts are expecting Apple to sustain double-digit earnings growth of 11% for the next five years. Based on its fiscal 2023 earnings of $6.13 per share, its bottom line could jump to $10.33 per share in five years.

Will Apple stock go up in 2024? ›

The stock has gained more than 30% over the last three months, and is now not only positive for the year, but is up 21.75% in 2024 - which is higher than what the S&P 500 Index ($SPX) has delivered over the period.

Apple is still Buffett's largest position

Although there's never really a perfect time to sell a stock, Buffett's insights above are intriguing. Basically, he's alluding that if tax rates indeed rise, then Berkshire would be required to pay higher capital gains on Apple in the future.

He's seen how devoted Apple users are to their devices, and has viewed the iPhone as an extraordinary product that could keep its customers spending inside the Apple ecosystem. He calls it a moat, one of his favorite words for describing his preferred businesses.

Apple currently has an average brokerage recommendation (ABR) of 1.62 on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell etc.)

AAPL Stock 12 Month Forecast

Based on 35 Wall Street analysts offering 12 month price targets for Apple in the last 3 months. The average price target is $230.25 with a high forecast of $300.00 and a low forecast of $164.00. The average price target represents a -1.77% change from the last price of $234.40.

Apple has the Financial Strength Rank of 7.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is.

Our research highlights several ethical issues with Apple, including climate change, environmental reporting, habitats & resources, pollution and toxics, arms & military supply, human rights, workers' rights, supply chain management, irresponsible marketing, anti-social finance, and political activities.