4 Reasons Why You Might Want To Own Apple Before It Reports

4 reasons why you need to own Apple before its report.

With plenty of market anticipation, Apple Inc (AAPL) will report its FQ3 '15 results tomorrow after the closing bell. Estimize and Wall Street are assuming lower EPS and revenue numbers for FQ2 QoQ. Apple continues to be a market darling with a year-to-date (YTD) capital return of 19.28% compared to the NASDAQ index which has managed to rise 9.99%.

Estimize currently have over 400 estimates for Apple, and are expecting EPS to be $1.86 and revenues to come in at $49.48B. Wall Street, to no surprise is predicting lower figures than Estimize and forecast EPS of $1.79 and revenues of $49.092B.

 

So despite the surge in Apple's share price over the past 2 years (up over 116%), there are number of reasons which suggest you should hold this stock leading into the FQ3 '15 result tomorrow:

1: Explosion of growth experienced from 6 and iPhone 6 Plus launch:

Apple's flagship product continues to produce phenomenal numbers with 40% YoY growth reported in FQ2 '15 when the tech giant sold circa 61.2M iPhones throughout the quarter. Although this is an exciting number, there could quite easily be more to come from iPhone sales in FQ3 '15. It is estimated that only 20% of previous iPhone customers had upgraded to either the iPhone 6 or iPhone 6 plus as at the end of March 2015. Therefore, there is plenty of room for Apple to obtain further sales from already loyal Apple users. Due to Apple's heavy reliance on iPhone sales (around 70% of total sales), further demand for this product is going to strongly influence the company's overall performance.

2: Penetration into China likely to result in continued growth:

Apple has continued to further diversify its revenue streams by geography over the past three years and China has been a major part of this. Nearly 29% of total revenue came from the Greater China region during FQ2 '15. Sales in the region grew 71% YoY which far outpaced the 27% increase in global revenue. China offers Apple an attractive growth strategy and expansion into this region is only going to further boost revenues for Apple.

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