AAPL: Will Shares of Apple (AAPL) Continue to Make New Highs?

New highs at over a $1 trillion valuation
Tim Cook walks a tightrope well
The 2020 election poses a threat

I write many articles on a Mac computer, and I never go anywhere without my iPhone. When I started in the financial business in the early 1980s, there were no computers on the desks of traders, financial advisors, and others involved in the markets.

Over the six decades of my life, I have witnessed profound changes. The global population has grown from under three to over 7.6 billion. When I was a kid, there were only six channels on TV and one more for those who spoke Spanish. Today, there are countless choices. Technology has made a growing world smaller when it comes to virtually all aspects of life.

Steve Jobs, the founder of Apple Computers (AAPL) was a visionary. I was fortunate to have met him during his hiatus from the company when he pioneered the NeXT system. The company I worked for in the 1990s, Phibro, used his system for a time.

It is incredible to me that I carry around a powerful computer in my pocket these days in the form of the iPhone. Steve Jobs was, in many ways, the father of the astonishing pace of technological advances over the past decades.

Unfortunately, his death in 2011 removed him from his mortal life, but his spirit lives on at the company he founded. His hand-picked successor, Tim Cook, is the steward of the company since Jobs’s death on October 5, 2011. Since the end of September 2011, AAPL shares moved from $54.47 to $260.44 per share, or over 4.75 times the price when Jobs passed. Over the same period, the S&P 500 has climbed from 1131.42 to its most recent high at 3,097. Apple shares have outperformed the overall market, and that is a trend that is likely to continue.

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New highs at over a $1 trillion valuation

Apple shares have continued to grow throughout the years and decades.

(Source: Barchart)

The chart shows the ascent of Apple shares. The most recent high was at $260.44 and closed at $260.14 per share on Friday, November 8. The company that has been an innovator and trailblazer had a market cap of $1.176 trillion.

Tim Cook walks a tightrope well

Steve Jobs passed away at a young age. He left his company in the capable hands of his chief operating officer, Tim Cook. He joined Apple in 1998 and took over the helm of the company on August 24, 2011, less than two months before the death of the founder.

Cook is not the visionary Jobs was, but he has been the man for the times. He has been a pragmatic CEO forging a strategic relationship with China and the current US President. Under Tim Cook, the company consistently beats consensus earnings estimates. While Apple may not be as innovative these days as it was under the founder, Mr. Cook created a sales machine that has put the company’s products into an ever-expanding addressable market. Moreover, Tim Cook has a much more diplomatic touch than his predecessor.

The 2020 election poses a threat

As the stock market continues to climb, Apple shares are destined to rise with the overall market. The company has become the symbol of US corporate dominance around the world. Meanwhile, many analysts believe that the biggest threat to the stock market these days would be the election of a progressive administration that increases taxes and regulations.

Even if the stock market were to suffer a 25% correction or more, Apple’s products and market share would likely make the company outperform the leading indices. I would be a buyer of AAPL on any significant correction that comes as a result of the 2020 election. Steve Jobs changed the world with his products, the brand represents the gold-standard for technology, and the founder would be proud of the job his successor is doing.

AAPL shares were trading at $262.22 per share on Tuesday afternoon, up $0.02 (+0.01%). Year-to-date, AAPL has gained 68.73%, versus a 25.46% rise in the benchmark S&P 500 index during the same period.

About the Author: Andrew Hecht

Andy spent nearly 35 years on Wall Street and is a sought-after commodity and futures trader, an options expert and analyst. In addition to working with StockNews, he is a top ranked author on Seeking Alpha. Learn more about Andy’s background, along with links to his most recent articles. More...