Apple: Berkshire Sales And Slow Revenue Raise Concerns

Summary:

  • Apple has seen slowed product growth and a higher valuation, making buybacks less attractive.
  • Berkshire Hathaway continues to reduce its stake in Apple, given these prospects but isn’t necessarily a guide for everyone.
  • Apple’s FY 2024 results show significant growth in the capital-light Services segment, boosting gross margins and free cash flow.
  • Services, potentially benefiting from generative AI, counters some reservations about Apple’s future, leveraging wide product adoption for revenue growth.
  • With a mix of good and bad factors, most sign point to AAPL being a Hold for the long-term investor.

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I discussed Apple (NASDAQ:AAPL) in September, with particular attention to half the stake in Berkshire Hathaway’s portfolio (BRK.A)/(BRK.B) being sold throughout 2024 by Warren Buffett. I concluded by rating


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