Day: October 21, 2024

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Apple Inc. (NASDAQ:AAPL) designs, manufactures, and markets smartphones, personal computers, tablets, wearables, and accessories worldwide. It is the largest company in the world with a market cap of $3.51 trillion.

It is set to report its Q4 2024 earnings on October 31. Wall Street analysts expect the tech giant to post an EPS of $1.60, up from $1.46 in the year-ago period. According to Benzinga Pro, quarterly revenue is expected to reach $94.41 billion up from $89.50 billion in the previous year.

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If You Bought Apple Stock 10 Years Ago

The company’s stock traded at approximately $24.69 per share 10 years ago. If you had invested $10,000, you could have bought roughly 405 shares. Currently, shares trade at $231.30, meaning your investment’s value could have surged to $93,682 from stock price appreciation alone. However, Apple also consistently paid dividends during the past 10 years.

Apple’s dividend yield is currently 0.43%. Over the last 10 years, it has paid about $19.13 in dividends per share, which means you could have made $7,748 from dividends alone.

Summing up $93,682 and $7,748, we end up with the final value of your investment, which is $101,430. This is how much you could have made if you had invested $10,000 in Apple stock 10 years ago. This means a total return of 914.3%. In comparison, S&P 500 total return for the same period is 257.58%.

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What Could The Next 20 Years Bring?

Apple has a consensus rating of “Buy” and a price target of $243.34 based on the ratings of 30 analysts. The price target implies more than a 5% potential upside from the current stock price.

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On Aug. 1, the company reported its Q3 2024 earnings, posting an EPS of $1.40 compared to the consensus estimate of $1.35 and revenues of $85.80 billion compared to the consensus of $84.531 billion, as reported by Benzinga.

The company set a new sales record for its iPhone during the quarter, coinciding with a broader recovery in the global smartphone market. Overall, the global smartphone market experienced a 5% year-over-year growth in Q3 2024, marking the fourth consecutive quarter of expansion.

Two reasons to jump on Apple stock now and one reason to think twice. Check out this article by Benzinga to learn more.

Given the historical stock price appreciation and expected upside potential, growth-focused investors may find Apple stock attractive. In addition, they can benefit from the company’s modest dividend yield of 0.43% and consistent hikes. Apple has raised its dividend consecutively for the last 12 years.

Wondering if your investments can get you to a $5,000,000 nest egg? Speak to a financial advisor today. SmartAsset’s free tool matches you up with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you.

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This article If You Invested $10,000 In Apple Stock 10 Years Ago, How Much Would You Have Now? originally appeared on Benzinga.com

Three major players—Microsoft, IBM, and Amazon—are set to release their quarterly earnings reports, and all eyes will be on these updates to assess their growth, resilience, and ability to drive future trends.

These earnings reports are particularly important as they will reveal how these tech leaders are leveraging advancements in artificial intelligence, expanding cloud computing services, and navigating macroeconomic challenges such as changing consumer habits, monetary policy, and geopolitical uncertainties.

Investors will also be watching closely to see whether these companies can help sustain the rally in the U.S. stock market. Last week, the S&P 500 reached a new all-time high, marking a 23% year-to-date gain, while the Dow Jones closed above the 43,000 mark for the first time, signaling continued optimism about market growth.

According to Bank of America, as earnings season kicked off, 30 companies in the S&P 500 surpassed earnings expectations by an average of 5%, up from 3% at the start of the last quarter. An additional 41 S&P 500 companies reported results last week. However, with the S&P 500 currently trading at around 21.8 times forward earnings—well above its long-term average of 15.7—some analysts caution that stock valuations may be stretched. Any disappointment in these reports could trigger a market correction as investors reassess valuations.

As we look ahead to big tech’s upcoming releases, here’s what to watch for:

1# ​​​​Will Microsoft’s Azure Unit Miss Expectations Again?

Microsoft delivered stronger-than-expected earnings and revenue for its fiscal fourth quarter, with total revenue rising 15% year-over-year. Net income climbed to $22.04 billion, up from $20.08 billion in the same quarter last year, translating to $2.69 per share.

While these results were solid, investor attention was focused on Azure’s performance, which fell below expectations for the first time since 2022. Azure and other cloud services posted 29% revenue growth, but this missed consensus estimates, sparking concerns about whether Microsoft’s cloud unit is losing momentum in an increasingly competitive market.

Despite the Azure miss, Microsoft’s management remains optimistic about future growth, suggesting potential acceleration in the coming quarters. However, investors remain cautious, as Azure’s performance is now a critical driver of Microsoft’s overall growth, especially as cloud computing continues to gain importance across industries.

As Microsoft prepares to release its fiscal Q1 2025 earnings on Tuesday, Oct. 22, after market close, all eyes will be on Azure once again. Analysts are forecasting a profit of $3.10 per share, with total revenue expected to dip slightly from $64.73 billion to $64.54 billion.

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So far this year, Microsoft shares are up 12.75%, hovering around $418.

2# Can IBM’s Share Price Hit New Highs with a Strong Earnings Surprise?

IBM has made notable progress in its business, particularly with its focus on generative artificial intelligence, which played a key role in its strong performance last quarter. In its second-quarter earnings report from July, IBM exceeded analysts’ expectations, reporting a 1.9% revenue increase to $15.48 billion compared to the previous year. Net income also rose significantly to $1.83 billion, or $1.96 per share, up from $1.58 billion, or $1.72 per share, a year earlier.

Despite these gains, IBM faces several macroeconomic challenges, including higher interest rates, inflation, and geopolitical uncertainties, which may impact its growth. Still, the company remains confident in its tech-driven approach, particularly in AI and cloud computing, which it believes will fuel future success.

As IBM prepares to release its Q3 2024 earnings on Wednesday, Oct. 23, investors are eager to see if the company can once again exceed expectations. Analysts forecast a slower profit of $2.22 per share, down from $2.43 in the previous quarter, and a slight revenue dip from $15.77 billion to $15.06 billion. If IBM delivers a strong performance—boosted by AI adoption or robust hybrid cloud growth—it could reignite investor confidence and push the share price to new highs.

So far this year, IBM shares are up 43.78%, hovering around $232.

3# Is Amazon Still Losing Ground to Its Peers?

Amazon reported softer-than-expected revenue for the second quarter, alongside a disappointing forecast for the third quarter. Net sales grew 10% year-over-year to $148.0 billion, up from $134.4 billion in the same period last year, but fell short of the $148.56 billion projected by analysts at LSEG. Despite the revenue miss, Amazon saw a significant boost in profitability, with net income climbing to $13.5 billion, or $1.26 per diluted share, compared to $6.7 billion, or $0.65 per diluted share, a year ago.

The underwhelming revenue performance is largely attributed to sluggish growth in Amazon’s core retail business, where competition from discount platforms like Temu and Shein has intensified. These rivals, which allow Chinese merchants to sell low-cost products to U.S. consumers, are eating into Amazon’s market share. Sales in Amazon’s online stores segment grew just 5% year-over-year, reflecting consumers opting for cheaper products and leading to a decline in the company’s average selling price (ASP).

On the cloud front, Amazon Web Services (AWS) performed well, growing 19% year-over-year and generating $26.3 billion in revenue, surpassing estimates of $26 billion. However, AWS is expanding at a slower pace compared to its major competitors, Microsoft and Google, whose cloud divisions are growing more rapidly.

As Amazon looks ahead, the company faces the challenge of balancing slow retail growth with rising competition in both e-commerce and cloud computing, adding pressure to innovate and find new growth opportunities in the next quarter.

So far this year, Amazon shares are up 26.05%, hovering around $188.

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This article was originally posted on FX Empire

More From FXEMPIRE:

Dear Paul,

I recently had to start taking money out of my investment accounts to satisfy my RMD (required minimum distribution). What’s the best thing to do with this money? I’d like it to continue to grow.

Still Want Growth

Most Read from MarketWatch

Dear Still,

Some people grouse when they have to take RMDs and grumble at the requirement to pay taxes on the money they withdraw. But if you can avoid that attitude, you can appreciate your good fortune in having this “problem.”

In years past, you essentially made a deal with the government:

·       The U.S. Treasury agreed that you wouldn’t pay taxes right away on some of the money you earned if you put it into a tax-sheltered investment account like an IRA or a 401(k). That meant this money could work for you instead of the government.

·       You agreed that when you reached a certain age (currently 73), you would start withdrawing that money and pay taxes on the withdrawals.

·       And now, as a result, you almost certainly have more money than you would if it weren’t for this deal.

What you should do with the RMDs depends mostly on your eventual plans for that money.

Read: Are you taking an RMD? 10 smart things you can use it for right now.

If you think you will use or need it later in your life, you will probably want to balance growth (stock funds) with some measure of stability (bond funds) with more emphasis on the latter when you are within spitting distance of its use.

However, if you expect to leave these investments to your heirs, you should consider investing with their financial needs and risk tolerance in mind. That might mean investing mostly, if not entirely, in equities.

In either case I think the U.S. four-fund portfolio should offer good equity returns with less volatility than the S&P 500 SPX. The four funds could be AVUS AVUS (large cap blend), RPV RPV (large cap value), IJR IJR (small cap blend), and AVUV AVUV (U.S. small cap value).

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You can see the long-term impact of these four equity asset classes in a colorful table that our team produced to show how this combination did, compared with its components, in every individual year from 1928 through 2023.

Quite aside from all that, there’s another important question you should ask yourself: Could some of this not-needed-now money improve your life in some significant way? My guess is the answer is yes.

Read: I have my RMD all figured out, except for one thing: Which investments should I take it from?

By age 73, you should be thinking about how to give yourself an extra reward for your years of working, saving and investing.

With some percentage of your RMD each year, you could do extra travel. You could donate to a charity that’s doing work you like. You could make gifts (up to $17,000 a year) to some of your heirs so you can experience their (you hope) appreciation and (you also hope) good sense in putting unexpected money (you also hope) to constructive use.

Whatever you choose, I think you can — and should — pat yourself on the back for the solid financial situation you are in.

Dear Paul,

Now that I’m 58 and approaching retirement, what is the most appropriate asset allocation and “glide path” for preretirement and then in retirement? I know the answer might be “It depends,” but for someone without a pension coming, and a mix of taxable and retirement accounts, what is the right mix of funds?

Gliding to Retirement

Dear Gliding,

You are right that the correct answer is “it depends.” To keep my answer simple (yet still sufficient), I’ll focus on two factors.

First, Wall Street’s collective wisdom. Second, your comfort level.

Big bucks are paid to the men and women who manage trillions of dollars in target-date funds (TDFs) at large mutual-fund companies. Every dollar is managed to combine an appropriate mix of growth (equity funds) and stability (bond funds) for investors in a given age range.

If you’re 58, you’re a good candidate for a fund such as Vanguard’s Target Retirement 2030 Fund (VTHRX). This fund’s glide path is managed assuming you’ll retire at age 65. If you intend to keep working longer, you could choose a fund with a later target date, say 2035.

These funds gradually change the mix of equities and bonds in their portfolios to become more conservative as their shareholders age.

There’s nothing wrong with this approach, and its sheer simplicity is a bonus.

However, you may want to be more conservative or more aggressive, depending on your risk tolerance and the amount of money you have in relation to what you will need to maintain an acceptable standard of living.

If you want to be more conservative, you could hold 10% to 15% of your money in bond funds and the rest in a target-date fund.

On the other hand, you may want to add a little extra firepower in order to increase the amount you are likely to have for spending in retirement and to leave to your heirs.

My suggestion in that case is to add something that target-date fund portfolios have very little of: small-cap value stocks. (You can also check out a recent podcast I recorded on this asset class; and for a much deeper dive, here’s a recent article.)

Our studies show that holding 80% in a target-date fund and the other 20% in small-cap value stocks could increase your annual return by 1% and increase your safe withdrawal rate by 0.5% (for example from 4% of your portfolio’s value each year to 4.5%).

That last detail may sound small, but in fact it represents a 12.5% increase in your retirement income all by itself.

For more on this idea, check out this excellent video with Chris Pedersen, director of research at the Merriman Financial Education Foundation.

.

Richard Buck contributed to this article.

.

Most Read from MarketWatch

By Jamie McGeever

(Reuters) – A look at the day ahead in Asian markets.

The trading week in Asia opens against an increasingly bullish global backdrop fueled by continued strength in U.S. stocks, but with local sentiment more circumspect due to the uncertainty surrounding China’s deep-rooted economic problems.

The People’s Bank of China is expected to cut its loan prime rates on Monday, Beijing’s latest move in a series of monetary, fiscal and liquidity support measures to shore up the imploding property sector, revive growth and fight off deflation.

PBOC Governor Pan Gongsheng told a financial forum in Beijing on Friday that the LPR will be reduced by 20 to 25 basis points on Monday, the official Xinhua news agency quoted Pan as saying.

The PBOC also on Friday unveiled new measures to inject more than $100 billion into the country’s stock market, which helped lift Shanghai’s blue chip equity index by 3.6%, while the MSCI Asia ex-Japan index rose 1.6% for its best day since Sept. 26.

China’s economic “data dump” on Friday wasn’t as bad as many feared it could have been, and annual GDP growth in the third quarter was slightly above consensus at 4.6%.

But as economist Phil Suttle notes, the past two quarters have been unusually weak, delivering 2.75% growth on a seasonally-adjusted annualized basis, “the weakest two-quarter growth rate in modern times” outside of COVID-related shutdowns.

Little wonder Beijing has sprung into action.

Stocks have responded positively, but bond yields are sliding again. They initially spiked higher on hopes the support measures, which include substantial bond issuance, will reflate the economy but 10-year yield is once again within sight of 2.00%.

U.S.-Sino trade wars have been pushed to the forefront of investors’ minds again after Republican presidential candidate Donald Trump said he would impose additional tariffs “at 150% to 200%” on China if China were to “go into Taiwan,” the Wall Street Journal reported on Friday.

The U.S. juggernaut, meanwhile, keeps rolling on – economic data are beating expectations, GDP growth is tracking well over 3%, incoming earnings are strong, and Wall Street is hitting new highs.

But perhaps the optimism is overdone. Analysts at Raymond James note that short-term options and technical indicators are getting skewed, suggesting the market may be “ripe for a period of consolidation or vulnerable to a near-term pullback.”

Financial conditions are easing around the world, as central banks cut rates and stocks march higher. On that score, investors in Asia will keep close tabs on the dollar, which has recovered recently and is at a three-month high.

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Friday’s Morning Bid Asia newsletter incorrectly stated that Malaysia would announce GDP data later in the day. The preliminary GDP will be released on Monday, Oct. 21.

Here are key developments that could provide more direction to markets on Monday:

– China loan prime rate decision

– Malaysia GDP (Q3)

– Reserve Bank of Australia deputy governor Andrew Hauser speaks

(Reporting by Jamie McGeever)