Is Apple a good AI stock to buy?
I was wrong on AAPL stock…
Apple stock hit record highs recently.
As of today, AAPL shares are trading at $214.
The recent surge happened after Apple unveiled its first artificial intelligence (AI) powered iPhone last week at the Apple WWDC 2024 (world-wide developer conference).
You could say AAPL has now become an AI stock.
The company will integrate ChatGPT into its new iPhones, naming the feature Apple Intelligence.
You’ll be able to have AI do things like rewrite emails… summarize messages… and edit photos for you.
If you’ve been reading me for a while, you know I haven’t been a fan of AAPL stock.
The last Apple earnings results showed it hasn’t grown revenues in over two years. Apple is no longer the fast-moving disruptor it once was.
Sure, it adds cool new features to each iPhone. But each version largely feels the same.
And I doubt the new AI bells and whistles are compelling enough to have people camping outside Apple stores to buy the latest release.
But my meeting with one of Boston’s largest hedge funds last week shifted my views on AAPL stock from bearish to neutral.
While Apple is no longer innovative, it has a lot of levers to pull.
One example: The iPhone’s search bar, which is the most valuable piece of “real estate” in the digital world.
More than 1 billion people use the search bar on their iPhone’s daily. Yet Apple doesn’t make any money off that. It could easily earn a couple billion dollars if it showed ads here.
Bottom line: AAPL stock can continue grinding higher. Apple is a huge platform and there are many ways management can monetize it. Plus, they just announced record share buybacks. But I still think there are better places to invest your money, especially in AI.
Nvidia, for example, is one AI stock I like better than Apple.
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