Latest news with #iPhone-maker
Yahoo
3 days ago
- Business
- Yahoo
Is AAPL Stock a Buy? Jim Cramer Says ‘Maybe Not' Unless Apple Does This 1 Surprising Thing.
Celebrated host of the popular CNBC show 'Mad Money' Jim Cramer reckons iPhone-maker Apple (AAPL) should act on rumors and acquire AI startup Perplexity. Long touted by many as being behind in the AI race, Cramer believes that 'the market wants growth, so you have to buy growth,' and that Apple should buy growth in a big way by snapping up Perplexity. The argument makes sense as Apple's 'Magnificent Seven' peers like Microsoft (MSFT), Meta (META), Google (GOOGL), and Amazon (AMZN) all have either their own generative AI platforms or have investments those from startups. Moreover, Meta's recent mammoth $14 billion investment to acquire a 49% stake in data company Scale AI only reinforces the fact that the AI race is only going to get hotter and Apple risks falling behind if it does not act fast. Super Micro Computer Just Struck a Deal with Ericsson. Should You Buy SMCI Stock Here? CEO Jensen Huang Just Sold Nvidia Stock. Should You? Broadcom Just Got a New Street-High Price Target. Should You Buy AVGO Stock Here? Our exclusive Barchart Brief newsletter is your FREE midday guide to what's moving stocks, sectors, and investor sentiment - delivered right when you need the info most. Subscribe today! Apple has always been known for its differentiation. Whether through its operating systems, hardware, privacy-first policy, or sleek designs, Apple has consistently outclassed its competition, which has resulted in its flagship iPhone and other devices reaching a global installation base of over 2 billion. Perplexity offers a similar edge as it is unlike other generative AI platforms. Known for its real-time, citation-backed answers, Perplexity is apt for research. Moreover, it offers access to several powerful language models, including GPT-4 Turbo, Claude 3, and Mistral, allowing users to cross-check results and benefit from the strengths of different models within one platform. This multi-model approach provides flexibility and robustness in generating accurate and diverse outputs, unlike single-model platforms. Also, its Pro Model is priced competitively at $20 per month, comparable to its peers. Meanwhile, Perplexity is purportedly in the middle of a funding round, aiming to raise $500 million at a valuation of $14 billion. Despite the fact that this is a lower valuation than what the company expected in March, it is still an almost 56% jump from the December 2024 valuation of $9 billion. However, with a $28.2 billion cash pile, it would not be an issue for Apple to come up with the money if it does decide to make a sizable acquisition. As highlighted extensively in my recent analysis, Apple has its problems with its position in the AI battle being of paramount concern to investors. Yet, its Services division has been a notable bright spot for the company in recent years. Moreover, Apple's unmatched brand will always be an edge for the company. Further, the outlook for Apple appears more resilient than often portrayed, with the company pursuing a diversified growth agenda that includes sustained emphasis on product and service development, broadening of its interconnected ecosystem, and fortifying its global supply chain. As part of this ongoing strategy, Apple has been consistently rolling out refreshed product lines, including the iPhone 16e, updated Mac models, and a new iPad, each powered by custom-designed Apple silicon chips. These processors are engineered to enhance speed and energy efficiency while unlocking new hardware-enabled functionalities across its device range. Notably, the company has achieved record highs across every major product category and geographic region within its installed base, a testament to the strength of its user retention and overall brand satisfaction. As Apple continues to open new physical and digital retail outlets in emerging markets such as India, the UAE, and Saudi Arabia, it is successfully drawing in new users while also increasing the stickiness of its service offerings. This geographic expansion serves to reinforce the company's customer acquisition loop and deepen monetization through services tied to its hardware ecosystem. Apple's financials are as strong as ever. Even after witnessing a correction of about 20% so far this year, Apple commands a gargantuan market cap of $3 trillion, making it one of the most valuable companies in the world. Apple's second-quarter performance for its fiscal 2025 once again outpaced market expectations, underscoring its continued ability to deliver steady growth even in a mature phase of its business cycle. Total revenue reached $95.4 billion, marking a year-over-year increase of 5.1%. Profitability also improved, with the company reporting a gross margin of 47.1%, modestly higher than the 46.6% margin recorded during the same quarter last year. Product-related revenue grew by 2.7% to $68.7 billion, while the Services division maintained its upward momentum, registering an 11.6% gain to $26.6 billion. Earnings per share came in at $1.65, comfortably exceeding the prior year's $1.53 and beating the consensus estimate of $1.62. Apple closed the quarter with a healthy liquidity buffer, ending the period with $28.2 billion in cash — an amount significantly above its near-term liabilities of around $6 billion. The company also reaffirmed its ongoing focus on shareholder value through the introduction of a new $100 billion share repurchase program, accompanied by a 4% dividend increase, lifting the payout to $0.26 per share. Considering all this, analysts have issued a consensus 'Moderate Buy' rating for Apple stock with a mean target price of $230.75. This indicates upside potential of about 15.2% from current levels. Out of 37 analysts covering the stock, 18 have a 'Strong Buy' rating, three have a 'Moderate Buy' rating, 13 have a 'Hold' rating, one has a 'Moderate Sell' rating, and two have a 'Strong Sell' rating. On the date of publication, Pathikrit Bose did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
3 days ago
- Business
- Yahoo
Is AAPL Stock a Buy? Jim Cramer Says ‘Maybe Not' Unless Apple Does This 1 Surprising Thing.
Celebrated host of the popular CNBC show 'Mad Money' Jim Cramer reckons iPhone-maker Apple (AAPL) should act on rumors and acquire AI startup Perplexity. Long touted by many as being behind in the AI race, Cramer believes that 'the market wants growth, so you have to buy growth,' and that Apple should buy growth in a big way by snapping up Perplexity. The argument makes sense as Apple's 'Magnificent Seven' peers like Microsoft (MSFT), Meta (META), Google (GOOGL), and Amazon (AMZN) all have either their own generative AI platforms or have investments those from startups. Moreover, Meta's recent mammoth $14 billion investment to acquire a 49% stake in data company Scale AI only reinforces the fact that the AI race is only going to get hotter and Apple risks falling behind if it does not act fast. Super Micro Computer Just Struck a Deal with Ericsson. Should You Buy SMCI Stock Here? CEO Jensen Huang Just Sold Nvidia Stock. Should You? Broadcom Just Got a New Street-High Price Target. Should You Buy AVGO Stock Here? Our exclusive Barchart Brief newsletter is your FREE midday guide to what's moving stocks, sectors, and investor sentiment - delivered right when you need the info most. Subscribe today! Apple has always been known for its differentiation. Whether through its operating systems, hardware, privacy-first policy, or sleek designs, Apple has consistently outclassed its competition, which has resulted in its flagship iPhone and other devices reaching a global installation base of over 2 billion. Perplexity offers a similar edge as it is unlike other generative AI platforms. Known for its real-time, citation-backed answers, Perplexity is apt for research. Moreover, it offers access to several powerful language models, including GPT-4 Turbo, Claude 3, and Mistral, allowing users to cross-check results and benefit from the strengths of different models within one platform. This multi-model approach provides flexibility and robustness in generating accurate and diverse outputs, unlike single-model platforms. Also, its Pro Model is priced competitively at $20 per month, comparable to its peers. Meanwhile, Perplexity is purportedly in the middle of a funding round, aiming to raise $500 million at a valuation of $14 billion. Despite the fact that this is a lower valuation than what the company expected in March, it is still an almost 56% jump from the December 2024 valuation of $9 billion. However, with a $28.2 billion cash pile, it would not be an issue for Apple to come up with the money if it does decide to make a sizable acquisition. As highlighted extensively in my recent analysis, Apple has its problems with its position in the AI battle being of paramount concern to investors. Yet, its Services division has been a notable bright spot for the company in recent years. Moreover, Apple's unmatched brand will always be an edge for the company. Further, the outlook for Apple appears more resilient than often portrayed, with the company pursuing a diversified growth agenda that includes sustained emphasis on product and service development, broadening of its interconnected ecosystem, and fortifying its global supply chain. As part of this ongoing strategy, Apple has been consistently rolling out refreshed product lines, including the iPhone 16e, updated Mac models, and a new iPad, each powered by custom-designed Apple silicon chips. These processors are engineered to enhance speed and energy efficiency while unlocking new hardware-enabled functionalities across its device range. Notably, the company has achieved record highs across every major product category and geographic region within its installed base, a testament to the strength of its user retention and overall brand satisfaction. As Apple continues to open new physical and digital retail outlets in emerging markets such as India, the UAE, and Saudi Arabia, it is successfully drawing in new users while also increasing the stickiness of its service offerings. This geographic expansion serves to reinforce the company's customer acquisition loop and deepen monetization through services tied to its hardware ecosystem. Apple's financials are as strong as ever. Even after witnessing a correction of about 20% so far this year, Apple commands a gargantuan market cap of $3 trillion, making it one of the most valuable companies in the world. Apple's second-quarter performance for its fiscal 2025 once again outpaced market expectations, underscoring its continued ability to deliver steady growth even in a mature phase of its business cycle. Total revenue reached $95.4 billion, marking a year-over-year increase of 5.1%. Profitability also improved, with the company reporting a gross margin of 47.1%, modestly higher than the 46.6% margin recorded during the same quarter last year. Product-related revenue grew by 2.7% to $68.7 billion, while the Services division maintained its upward momentum, registering an 11.6% gain to $26.6 billion. Earnings per share came in at $1.65, comfortably exceeding the prior year's $1.53 and beating the consensus estimate of $1.62. Apple closed the quarter with a healthy liquidity buffer, ending the period with $28.2 billion in cash — an amount significantly above its near-term liabilities of around $6 billion. The company also reaffirmed its ongoing focus on shareholder value through the introduction of a new $100 billion share repurchase program, accompanied by a 4% dividend increase, lifting the payout to $0.26 per share. Considering all this, analysts have issued a consensus 'Moderate Buy' rating for Apple stock with a mean target price of $230.75. This indicates upside potential of about 15.2% from current levels. Out of 37 analysts covering the stock, 18 have a 'Strong Buy' rating, three have a 'Moderate Buy' rating, 13 have a 'Hold' rating, one has a 'Moderate Sell' rating, and two have a 'Strong Sell' rating. On the date of publication, Pathikrit Bose did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on


Mint
17-06-2025
- Business
- Mint
Does every business need a cash pile like Warren Buffett's?
WARREN BUFFETT must be feeling smug right now. Months before American stockmarkets started sliding from record levels in late February, as investors began to question President Donald Trump's stewardship of the world's largest economy, the nonagenarian billionaire was cashing out of equities. In 2024 his industrial conglomerate, Berkshire Hathaway, sold a net $134bn of stocks, including two-thirds of its $174bn stake in Apple. By the end of March the S&P 500 index of America's biggest companies was 9% down from its peak. So was the iPhone-maker. Berkshire, meanwhile, was sitting pretty on a 10% gain—and a pile of cash to make Scrooge McDuck blanch. Converted into $100 bills, its $334bn in liquid assets would fill 1,900 king-size mattresses. The internet buzzed with memes about preternatural market timing. The Oracle of Omaha was looking even more oracular—not to mention comfy on all that bedding—after Mr Trump launched an unprovoked trade world war on April 2nd. The next day Berkshire lost just 1.5% of its value, compared with 5% for the S&P 500 and another 9% for Apple. In the chaotic days that followed Mr Buffett took a knock along with everyone else, then recovered after Mr Trump paused his 'reciprocal tariffs" on April 9th—but with less volatility. More important, whereas the market as a whole is still 11% below its all-time high, Berkshire is up by 7% since then, and just shy of its record market capitalisation of $1.2trn. A cushion is handy in uncertain times, and times have seldom been this uncertain. Many investors concluded as much amid the initial post-tariff mayhem, offloading stocks and notionally safe-haven assets at the same time. Perhaps they stuffed the proceeds into mattresses. Should bosses be apeing Mr Buffett and building cash buffers, too? Not so fast. Not every cash-rich business has withstood the buffeting of recent months as well as Mr Buffett's firm. True, Amazon and Alphabet, which among non-financial firms have the world's third- and fourth-biggest cash piles (roughly $100bn apiece), performed about as well as Berkshire in the past week. But both are still down by around 15% since markets peaked. Liquid assets worth $75bn or so did not stop Toyota and TSMC, giant Asian manufacturers of cars and semiconductors respectively, from being clobbered since the start of the year. CITIC, a Hong Kong-listed Berkshire wannabe, boasts $249bn in cash and a measly market capitalisation of $31bn (this is partly explained by a balance-sheet that is, in part, bank-like). A back-of-the-envelope analysis suggests zero correlation between the absolute size of a company's cash position and its share price, be it over the past week or the past year. Return on capital or return on equity also show no link to cash-richness. The same is true if you look at cash relative to revenues. On that measure Berkshire ranks 56th among the world's 1,100 or so most valuable listed companies (again, excluding finance). The highest spot is claimed by Insmed, a $12bn biotechnology company with enough cash to cover four years of sales and no shareholder returns to speak of so far in 2025. The top ten include Prosus, a technology investment firm, and Grab, a Singaporean digital conglomerate, as well as CITIC. All have seen better days. There is a hint of a relationship between a company's cash-to-sales ratio and its compound annual revenue growth over the past five years. But, with a correlation co-efficient of 0.25 (where one is perfect alignment and zero is none), it is tenuous at best. Many corporate stars of the past few years are anti-Scrooges. Nvidia, the $2.8trn semiconductor giant whose chips power the artificial-intelligence revolution, has liquid assets equivalent to a middling 33% of revenues. Novo Nordisk, the $265bn Danish maker of hit weight-loss drugs, is in the bottom third on this measure, at 9%. Both put capital to hyperefficient use, returning 71% and 46%, respectively, outshining all but a handful of the 1,100 companies in our sample. No self-evident benefits to a cash fetish present themselves, in other words. The drawbacks, by contrast, are more obvious. The biggest of these is the opportunity cost. Clinging on to liquid assets means the money is not put to more productive use. Berkshire's pile is two and a half times as large as it was five years ago. Its return on capital has declined in that period. Grab's return on capital is negative. Prosus shares trade at around a 40% discount to the net value of its assets. At least Prosus has the good grace to hand some of the unspent money back to shareholders. In the past five years it has paid $26bn in dividends and share repurchases. CITIC, too, has been generous with its owners, forking out an average annual dividend of $1.8bn. Grab, which went public only in 2021, may be excused for handing out just $226m so far, all of it last year. The same cannot be said of Mr Buffett, who has not paid a dividend since 1967. Lately he has also become increasingly stingy with buy-backs, which declined from around $25bn a year in 2020 and 2021 to less than $3bn in 2024. This contrasts with Nvidia and Novo Nordisk, which despite reinvesting in innovative technology have found it in themselves to reward shareholders. Novo Nordisk paid out $38bn over the past five years. Nvidia showered investors with $41bn last year alone. Don't go to the mattresses Mr Buffett's cash buffer may look smart in a world gripped by Trumpian turmoil. It nevertheless seems almost churlish of him to insist on holding so much insurance, for that is what such a buffer amounts to. Does Berkshire really need roughly as much liquidity as Standard Chartered and NatWest, two of the world's big banks? Anyone can pad a mattress with dollar bills. A legendary investor ought to have cleverer ideas. Subscribers to The Economist can sign up to our Opinion newsletter, which brings together the best of our leaders, columns, guest essays and reader correspondence.
Yahoo
11-06-2025
- Business
- Yahoo
WhatsApp fights Yvette Cooper's ‘dangerous' attempt to break encryption
Mark Zuckerberg's WhatsApp has challenged a 'dangerous' attempt by the Home Office to secretly force Apple to build a backdoor in its encryption technology. The private messaging app said it had intervened in a case at the Investigatory Powers Tribunal, submitting evidence criticising an order by Yvette Cooper's department that requires Apple to break an 'advanced data protection' feature that encrypts iPhone back-ups. Will Cathcart, the head of Meta-owned WhatsApp, said: 'Liberal democracies should want the best security for their citizens. Instead, the UK is doing the opposite through a secret order. 'This case could set a dangerous precedent and embolden nations to try to break the encryption that protects people's private communication.' Apple is challenging the 'technical capability notice' from the Home Office, issued in January, that ordered it to secretly install a backdoor into the encryption feature it introduced in 2022. The iPhone-maker was legally barred from confirming the existence of the order, which emerged in US media reports. Disclosing the existence of the demand is illegal under UK surveillance laws. However, in February, Apple said it would be withdrawing the feature in the UK and said it would 'never build a backdoor or master key to any of our products or services and we never will'. Ms Cooper's order has prompted criticism from the White House and senior Republicans. Donald Trump described the demand as 'something that you hear about with China'. Tulsi Gabbard, the US national intelligence director, called it 'egregious'. WhatsApp said it would be arguing that the case should be heard in public. Mr Cathcart said: 'WhatsApp would challenge any law or government request that seeks to weaken the encryption of our services and will continue to stand up for people's right to a private conversation online.' In April, the Investigatory Powers Tribunal, a secret court that hears cases about intelligence matters, ruled against the Home Secretary's push for the case to be heard in total secrecy. This would have meant that even the existence of the dispute could not be publicised. The Home Office argued that any coverage of the matter could be 'damaging to national security'. However, after an intervention by media groups, including The Telegraph, privacy advocates and a group of US politicians, Lord Justice Singh, the president of the tribunal, and Mr Justice Johnson dismissed the effort to keep even the 'bare details' of the case private. The court said it was possible that some of the future developments in the case could be made public. Britain's security services and the Home Office have long sparred with the tech industry, warning that the rise of heavily encrypted messaging and digital storage makes it harder to stop terrorism and catch child abusers. Last week, US politicians attacked Britain's demands in a hearing in Congress. Andy Biggs, a Republican House of Representatives member, said the Home Office's demand 'threatens the privacy and security rights, not only of those living in the UK, but of Apple users all over the world'. He added that the UK was 'attacking America's data security and privacy'. The Home Office was contacted for comment. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
Yahoo
11-06-2025
- Business
- Yahoo
WhatsApp fights Yvette Cooper's ‘dangerous' attempt to break encryption
Mark Zuckerberg's WhatsApp has challenged a 'dangerous' attempt by the Home Office to secretly force Apple to build a backdoor in its encryption technology. The private messaging app said it had intervened in a case at the Investigatory Powers Tribunal, submitting evidence criticising an order by Yvette Cooper's department that requires Apple to break an 'advanced data protection' feature that encrypts iPhone back-ups. Will Cathcart, the head of Meta-owned WhatsApp, said: 'Liberal democracies should want the best security for their citizens. Instead, the UK is doing the opposite through a secret order. 'This case could set a dangerous precedent and embolden nations to try to break the encryption that protects people's private communication.' Apple is challenging the 'technical capability notice' from the Home Office, issued in January, that ordered it to secretly install a backdoor into the encryption feature it introduced in 2022. The iPhone-maker was legally barred from confirming the existence of the order, which emerged in US media reports. Disclosing the existence of the demand is illegal under UK surveillance laws. However, in February, Apple said it would be withdrawing the feature in the UK and said it would 'never build a backdoor or master key to any of our products or services and we never will'. Ms Cooper's order has prompted criticism from the White House and senior Republicans. Donald Trump described the demand as 'something that you hear about with China'. Tulsi Gabbard, the US national intelligence director, called it 'egregious'. WhatsApp said it would be arguing that the case should be heard in public. Mr Cathcart said: 'WhatsApp would challenge any law or government request that seeks to weaken the encryption of our services and will continue to stand up for people's right to a private conversation online.' In April, the Investigatory Powers Tribunal, a secret court that hears cases about intelligence matters, ruled against the Home Secretary's push for the case to be heard in total secrecy. This would have meant that even the existence of the dispute could not be publicised. The Home Office argued that any coverage of the matter could be 'damaging to national security'. However, after an intervention by media groups, including The Telegraph, privacy advocates and a group of US politicians, Lord Justice Singh, the president of the tribunal, and Mr Justice Johnson dismissed the effort to keep even the 'bare details' of the case private. The court said it was possible that some of the future developments in the case could be made public. Britain's security services and the Home Office have long sparred with the tech industry, warning that the rise of heavily encrypted messaging and digital storage makes it harder to stop terrorism and catch child abusers. Last week, US politicians attacked Britain's demands in a hearing in Congress. Andy Biggs, a Republican House of Representatives member, said the Home Office's demand 'threatens the privacy and security rights, not only of those living in the UK, but of Apple users all over the world'. He added that the UK was 'attacking America's data security and privacy'. The Home Office was contacted for comment. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data