I can’t stop buying Apple (NASDAQ:AAPL | AAPL Price Prediction), and the most recent quarter only deepened my conviction. I added shares in March when the stock dipped to $252.82, added again in early April, and I expect to add more before summer.
At $273.43 with a trailing P/E of 34, the stock trades at a premium by classical measures. I still keep buying. Here are the three reasons why.
1. The cash machine just shifted gears
Apple generated $53.93 billion in operating cash flow in a single quarter, a figure that rose 80.14% year over year. That shows a company nearly doubling its cash generation while already sitting on $45.32 billion in cash and equivalents.
Management returned $24.70 billion to shareholders through buybacks in Q1 FY26 alone, on top of $90.71 billion across all of fiscal 2025, and the board authorized another $100 billion repurchase program last May. Every quarter I hold, my slice of the company grows without me lifting a finger.
2. Growth reaccelerated, and China came back
Revenue grew 15.7% year over year in the December quarter, with EPS of $2.84 beating consensus by 6.34%. iPhone revenue hit a record $85.27 billion, up 23.3%, and Tim Cook described the demand as “unprecedented”. Greater China, the region everyone wrote off, jumped to $25.53 billion from $18.51 billion a year earlier. That is the kind of reacceleration rarely seen at a $4 trillion behemoth.
3. The Services flywheel keeps compounding
Services revenue hit an all-time high of $30.01 billion, up 14%. The margin profile here is what gets me: Services cost of sales ran $6.46 billion against $44.03 billion for products in Q2 FY25, a structural gap that pulls consolidated operating margin toward 35.4%.
With the installed base now above 2.5 billion active devices, every App Store subscription, iCloud upgrade, and Apple TV+ signup feeds a recurring revenue stream I am happy to own.
What could go wrong
Trade disputes, ongoing tariff pressure, and the DOJ antitrust overhang tied to Google’s search default payments could all meaningfully dent earnings in a given quarter. That risk has not changed my thesis because Apple has delivered 8 consecutive earnings beats through exactly those headwinds, and the installed base keeps expanding regardless.
Why I keep buying
I keep buying because the forward setup rewards patience. Forward EPS sits at $8.94, the analyst consensus target is $297.71, and prediction markets put iPhone 18’s 2026 release at 90.5% probability with a foldable iPhone before 2027 at 82.5%.
New CEO John Ternus inherits a company printing cash, buying back stock, and selling more iPhones than ever. I plan to keep adding on every pullback to the 200-day moving average near $253.02, and I will not apologize for it.
Top Gaining Stocks
Top Losing Stocks