With four trading days left in 2020, the best performing Dow stock has already been determined. Apple Inc.’s (NASDAQ: AAPL) share price has risen almost 80% this year. The DJIA is up 6%. No other component’s share performance among the 30 stocks is even close to Apple.
The run-up has made Apple the most valuable company in America with a market cap of $2.24 trillion. And, no other public corporation has a figure that is even close to that.
The sharp rise in price has several engines. The first of these is the iPhone 12. It is expected to sell better than any iPhone in years. Among the reasons is that it works on the new 5G superfast wireless networks, which have started to become the standard in the U.S., Europe, China, and Japan which are Apple’s largest markets. One research firm claims Apple will produce 96 million iPhones in the first half of next year.
Earlier this month, 24/7 Wall St. reported that based on the same source: “For all of next year, Apple has drawn up a preliminary forecast for 230 million iPhones, an increase of 20% compared with production in 2019 and near its record production of 231.5 million iPhones in 2015.”
Two of Apple’s smaller lines of business have done extraordinarily well. When Apple reported its most recent earnings, Tim Cook, Apple’s CEO, said: “Apple capped off a fiscal year defined by innovation in the face of adversity with a September quarter record, led by all-time records for Mac and Services.” In the quarter, Apple’s overall revenue was $65 billion, up from $64 billion in the same period of 2019. Mac revenue was $9 billion, up from $7 billion in the year-ago period. Services revenue was $14.5 billion, up from $12.5 billion.
Services revenue includes sales from iTunes, the App Store, Mac App Store, Apple Music, Apple Pay, AppleCare, Apple TV+, Apple Arcade, Apple News+, according to MacRumors.
After several years in which iPhone sales increases lagged other Apple business lines, the company’s flagship is set to outperform over the current holiday quarter, and well into next year.
Apple’s earns are expected to be extraordinary over the next several quarters. Several securities analysts have price targets well above the $130 price level. Apple’s market cap could move as high as $3 trillion in 2021.
It is not a stretch to imagine that Apple could be the top-performing Dow stock next year.