Should you buy Apple stock or has the company run out of growth opportunities? What is my price prediction for Apple in the next years? Read until the end as I reveal my price target for Apple and also what I think will happen in the next couple of days, weeks & months!
~ Warning! Very Very Long Post~
Hello everyone! So, let’s go over some of the latest news on Apple before moving on to some fundamental and technical analysis, predictions and my price target for the stock in the next years.
So, let’s start with the news that Apple will cut the App Store commission in half for small app developers starting in the next days, this will affect developers who earn less than $1M annually from the App Store Sales. This is likely to lead to a small decline in commission revenues for Apple as around 98% of the app developers will qualify for this tax reduction from 30% to 15%, but all these small developers only contribute to about 5% of the estimated $50B in annual revenues from the App Store, so that would be only a $1.25B loss for the company, that is less than half a % of the company’s total net sales in the last fiscal year.
Also, these changes may lead to a potential long-term revenue boost, as it is likely this will lead to an increasing creation of apps which will generate more commissions in return.
Alongside this we also saw the company releasing the new MacBook’s with their first in-house chip, which promises faster video and imaging processing times, with both CPU and GPU performance up to 2 times faster than the latest PC laptop chip using just a fraction of the power consumption, with both of the macbooks promising big improvements in battery life. Apple is also expected to roll out even more in-house chips in future products, as they have started the 2-year breakup with Intel chips.
We also saw Morgan Stanley upgrading their base case to $191 at the end of November, as they have cited record lead times, supply chain forecasts and carriers demand as they expect that the company will sell around 270M iPhone in fiscal year 2021, that’s 50M more than the consensus and almost 30M more than the previous estimate of Morgan Stanley, with an average selling price of 842$, 9% more than the base case, as people tend to chose the more expensive and high tech versions of the lineup in this new 5G cycle.
The 5G super-cycle, which I believe is on the way, and will continue in the next years, as 5G become more available worldwide, could still be the biggest thing coming right away for the company with 5G smartphones expected to surpass 4G sales by 2024, with the average sale price of the 5G phones also coming down, helping them become more popular. This will also be helped by the recent entry to the Indian market, as India will probably become the world biggest country in the next decade, this could be a huge opportunity for Apple to start and take away market-share from their competitors like Samsung and Xiaomi which have the biggest market shares right now.
They also released an update iPad Pro and an all-new iPad Air in September which will also boost sales in this work-from-home environment that will keep the demand very high for this kind of products, just like the Macs. Alongside the increasing demand from the Wearables, Home & Accessories that include Air Pods, Apple TV, Apple Watch, and many more products.
But the biggest reasons I believe Apple is poised for continued growth, is primarily due to its services business, as they start to offer more and more services like the Apple ONE BUNDLE, which include up to 6 services from (Apple Music, Apple TV+, Apple Arcade, Apple News+, the new Apple Fitness+ and the iCloud service) for a pretty reasonable price in my opinion starting from 15$ up to 30$/month, this could be a great option for families and even individuals who use their services a lot.
The latest services, Fitness+ just launched in the past days, and is a direct competitor to the likes of Peloton, as the service is available on the iPhone, iPad or even Apple TV. This also makes consumers buy the Apple Watch which syncs to the other devices to show you different information. The Fitness+ app just on its own is 8$/month or 80$/year which is less expensive than Peloton subscription which charges 13$ or even traditional gyms like Planet Fitness at 10$/month.
I think this will be the fastest growing sector for the company, as this aligns with the new macro trends, as the world is moving more and more to a digital approach to almost everything as consumer preferences, with more & more younger people reaching the point in life when they use these services start to align to this increasing digital approach.
We also shouldn’t forget the Apple Card & Apple Pay service among many others which also seem to gain from the move to digital & contactless payments, as this has been accelerated due to the current situation in the past year.
And one last piece of news, and the most recent one, is that Apple may have fast-tracked the Titan project. The Titan project is targeting a 2024 or 2025 push to develop an electric vehicle with advanced battery technologies, that will deliver significant increases in range at much lower costs than the current technologies while also offering self-driving capabilities.
It’s reported they will not use the same technology as Tesla Full-Self-Driving feature, but will use LIDAR sensors, similar to those that we can find in the latest iPhone 12 PRO.
I think Apple can go 2 ways with this project, they can either use the huge amount of cash the company has to buy another car-maker like Ford, GM or any other car manufacturer expect Tesla and Toyota which do have a big market cap, so that they can fast-track the potential manufacturing of cars, or they can enter into a partnership with big companies like Tesla, Volkswagen or any other car marker to either produce cars or license their technology to this other car-makers which would ultimately and probably have higher margin-returns than the effective manufacturing of cars. Apple’s current overall gross margins stand at 38% vs the 15% average of the world top 10 automakers by market cap, which is significantly lower.
But this Apple Car thing is so far out, and there are so many unknowns, I will not try to predict anything related to this until there is more clarity on the subject.
And last, before moving on to some predictions, here are some of the highlights that we heard from the latest investors conference meeting, as the CEO, Tim Cook expressed optimism ahead with the launch of many new products and services, especially the Home Pod Mini and the new 5G iPhones, as these new iPhones include new LIDAR scanners that greatly improve the camera capabilities, as the iPhone as seen very positive reviews. We also saw the Senior VP and CFO, Luca Maestri give us great outlook for the company as they expect the installed devices base to continue to growth despite already being at an all-time high as they have over 585M paid subscriptions on their platforms and expect this to surpass 600M by the end of 2020.
I also researched and found what products we can see in the near future, with the first half of 2021 bringing new iMacs, the AirPods3 and the iPad Pro, while in the FALL event we will probably get the new iPhone 13 alongside the iPhone SE PLUS and the Watch Series 7 with more products coming later in 2021 or that don’t have an estimated release date like the Air Pods Pro, the Air Tags and the iPad Mini 6.
So, before even starting, you should know that I am bull on Apple but I am willing to hear other opinions so don’t be afraid to leave a comment down below.
I have made some predictions based on the growth rate of the company, the latest plans announced by them and used some estimates. So, keep in mind this are only projections and are calculated by myself, this is not an investment advice and you should do your own research.
This are my 2025 projections for Apple, let’s take a closer look at them, each on their own.
So, in term of revenues, Apple has 5 big sources of income, which saw an overall increase of 6% despite lagging sales in the iPhone. The biggest revenue is by far the iPhone right now with over $137B in revenue in the fiscal year ending in September. I expect to see the iPhone sales increasing in the next years, especially in 2021, with the new 5G iPhone creating a super-cycle for the company, as most iPhone users, including myself here, as I will upgrade from my iPhone X, will switch to this new product. The iPhone sales have decreased in the last couple of years by 14% and 3% as a result of the product not having big improvements, as well as iPhone usually starting to last longer than previous models, so I expect to see a 12% increase in sales next year and a gradual decrease in the growth of sales as more people upgrade, ending with just a 5% growth in iPhone sales in 2025.
The next revenues stream is from the Mac, which has seen an increase in the past 2years, with revenues topping $28B this year after the huge demand from the work from home consumers. I expect this trend to continue as they plan to continue to launch better products and I can see the company having a similar growth next year before starting to decline slightly until 2025, also ending with a 5% growth.
The iPad is currently the smallest revenue stream for Apple but has also seen an increase in demand in the past 2 years with a 13% average increase in revenues. I also expect the iPad to continue to grow in the next couple of years, especially with the learn-from-home environment for kids, and even after this period ends, the transformation for learning will implicate more digital usage. I expect the iPad to see some similar growth to the Macs, especially with the latest generation also bringing a new iPad air to the market.
The 4th revenue stream and the fastest growing in the past 2 years, with an average growth of 33% are the wearables, home & accessories revenues. This have topped $30B this year, as Apple has also just launched the Apple Watch series 6 and also feature other great products like Apple TV, the Air Pods the Home Pod and the Home Pod mini alongside other third-party accessories.
I gave this revenue stream a growth of 20% starting next year with a gradual decrease to around 8% by 2025, as I believe this will become more & more popular as they start to offer more vertical integration.
And last, but by no means least, the revenue stream that I expect to grow the most and the fastest is the revenue from the services that Apple offers. This includes revenues from Apple Care, Advertising, Cloud Services, Payment Services like Apple Card & Apple Pay and of course the digital content which includes fees from the App Store alongside subscription-based income including the new Apple One Bundle and Apple Fitness+ alongside the already know Apple Arcade, Apple Music, Apple News+, Apple TV+ and hopefully I don’t forget any others.
So, I expect this to become the clear 2nd biggest revenue stream for Apple by 2025, as I expect this to grow more than 20% next year, mainly due to the Apple One Bundle and Apple Fitness+ followed up by a slightly decreasing growth, ending with a 10% increase in revenues in 2025.
I think this are fairly conservative base case scenarios for the revenues, as I expect them to continue to increase the other revenue streams and not have such a large percentage of the revenues coming from the iPhone sales as you can see in this chart.
In terms of expenses, I pretty much kept the same margins as in previous years, with a 68% expense ratio on product sales [ iPhone / iPad / Mac / WHA ] and 35% expense ratio on SERVICES, as this are way more lucrative.
In the past 3 years, the products gross margin was 32.7%, so I actually imply bigger expenses for the manufacturing and sales of products, as this is mostly impacted by the company’s supplier’s ability to make up for and demand, while for the services revenue, the gross margins for the last 3 years has been 63.5% on average, but I expect this to be more in-line with the 66% margin in this past year. So, if services manage to grow to about half the revenues from the iPhone, this will effectively double the gross revenues, as every buck gained in the service revenues account for 2$ in the product sales.
So, I expect the total revenues for Apple to increase from $274B in 2020 to over $440B by 2025, increasing by approximately 10%/year, while I will keep the expense ratio pretty much in-line and have them increasing by 11%/year, this would bring the total gross income for Apple to $177B, increasing mainly due to the services revenues as I said earlier. This growth is just above the 4year average, and below the 2018 levels, which we might see again with this 5G super-cycle and explosive growth in the services revenue.
I also think the company will continue to invest in both Capital Expenditure and Operating expenses.
I think the operating expenses will remain pretty much in line with the previous years, as this number has increased by 1% annually both in R&D and SG&A. So, I will keep the exact percentages from previous years, as I expect the revenue to increase, thus I don’t see a big increase percentage wise. This would account for over $60B in operating expenses by 2025 and over $11B in Capital Expenditures by 2025, as I expect this to increase, mainly due to the possible EV developments or investments in self-driving capabilities alongside other manufacturing capabilities. You can see that the Capex spending has been decreasing in the past years with just over $8.8B in payments for business acquisitions and the other traditional Capex spending. Some people may use the cash generated by investing activities as Capex, but that is more unreliable. I also can see the Capex going back up, so I wanted to be safe and implied a 10% growth.
This money would account for over $73B in expenses and would bring the profit for the company to almost $104B before interest and taxes.
Moving on, let’s see what interest income and expenses the company has had in the past few years. We can see a decrease in interest expense in the past few years as the company has been paying off debt, but they have also been generating less money in this department, with an overall decrease in this department of more than 50% in the past year, way less than the amount from 2018. So, for safety reasons, I used a 10% decline in both income and expenses related to interest, while increasing the other losses by 10%/year.
This would bring the company pre-tax income to just over $104B in 2025.
Let’s move on to taxes. I know the Federal income tax rate is 21% for the company, but the actual effective tax rate for the company was lower than 15% in the past year, mainly due to lower tax-rates on foreign earnings alongside tax-benefits and tax-settlements. The average effective tax rate has been just over 16% in the past 3 years, but with more and more of the revenues coming from outside the US, I think it’s safe to say that the company will have around a 15% effective tax rate by 2025, this obviously if nothing major changes in tax policy around the world.
So, Apple would have $88.6B in income after tax by 2025 and with the current outstanding shares standing at just under 17B, so I don’t even account for the company probably continuing to do share buybacks, this would mean a $5.22 future earnings/share. And with today’s price for Apple just around 136$, that would mean to company is trading at just over 26 times forward price to earnings.
I don’t think Apple will ever trade at a discount again, with the current PE standing at over 40, I believe this will eventually go down, probably to around 35, despite the increase in services revenue, which is highly valued by investors. I think we can see Apple trade somewhere near 35 times P/E in 2025, especially if something big happens with the EV project, this could be even higher, just look at Tesla which trades at insane P/E. Of course, we also have to take into consideration the dividends that will be received from owning the stock, as Apple has started to pay dividends almost a decade ago and has 9 years of dividend growth, with a 10% annual rate of growth in the past 5 years. Here is the dividend growth history for the company, as I also went conservative on this estimate and implied a 7% growth for the next 2 years, 6% for 2023 and 2024 and just 5% in 2025.
So here are my 3 price targets for the company, including dividends but not reinvested. My bear case scenario is that Apple will trade at almost 165$ which implies a return of over 21% by 2025, while my base case scenario would see Apple trading at 195$ with a return of capital of 43%. I will also make the bull case for Apple trading at 225$ by 2025 with dividends included, which would imply just over 65% in gains by then.
I think this is possible as Apple has also continued to buy back shares of the company on a constant basis, as they continue to an impressive campaign with over $72B worth of common stock repurchased in 2020. They continue to buy back shares at a very fast pace, having repurchased over 1.3B shares in 2019 and 2018, while also issuing less stock every year.
So here is the full spreadsheet that I have projected for Apple by 2025 and the breakdown of everything i estimated [ 1 / 2 ] , if you do have another opinion or a suggestion please leave a comment down below, I think I have been conservative in most of my projections, but feel free to give your opinion.
Keep in mind, these targets might sound ridiculous, but just look at the growth Apple has had in the last 5years. The company has increased in value by more 400% in just the past 5years and is over 100.000% up since it started trading. So yes, the valuation is mad right now for the company. So, are you willing to bet against Apple?
The company also has pristine financials, with more than $65B in total assets compared to total liabilities, and more than $38B in cash and cash equivalents.
So, what do I expect in the next couple of days, weeks and months for Apple?
Let’s look at this CHART, so starting with the stock split, Apple saw a correction within the September stock market pullback, in a buy the news & sell the event, after a huge runup post-announcement of the stock split. The stock entered a consolidation period, and didn’t have any big catalysts, especially with new iPhone lineup not being included in the Q4 results due to the late launch. The stock found some levels of resistance near the $120 levels that it struggled to get past but acted also as support after breaking them just before the recent news of the possible EV developments or self-driving-features to be licensed to other car manufacturers. After that news the stock spiked and has now reached the previous highs made before the stock split and is facing some resistance, if the stock pushes over $140 I think we can officially say that it broke the resistance at those levels and is not just a fake-out. But I think it’s likely that the stock will consolidate between 122 and 135$ in the next weeks until the next iPhone sales and quarterly results are released, as the stock has entered overbought territory again with an RSI over 70, the first time since the stock split.
So, what would I do? Well, I own Apple stock, and I really believe this company will remain the biggest or one of the biggest in the future, so I would really add on any weakness that the stock shows before the next quarter earnings are released, as typically Q1 earnings are the best for the company due to increased holiday sales combined with the launch of new products. I think any entry below 130$ would be really nice to start and build a position or increase it if you already own the stock. As I believe Apple is one of the most stable stocks out there with large institutional holders like Vanguard, BlackRock and Berkshire owning over 900M shares each.
Thank you everyone for reading! Hope you enjoyed the content! Be sure to leave a comment down below with your opinion on the stock market!
Have a great day and see you next time!

Should you buy Apple stock or has the company run out of growth opportunities? What is my price prediction for Apple in the next years? Read until the end as I reveal my price target for Apple and also what I think will happen in the next couple of days, weeks & months!
~ Warning! Very Very Long Post~
Hello everyone! So, let’s go over some of the latest news on Apple before moving on to some fundamental and technical analysis, predictions and my price target for the stock in the next years.
[Disclosure: I made this DD last month, but I wasn't part of this Subreddit until the last few days]
So, let’s start with the news that Apple will cut the App Store commission in half for small app developers starting in the next days, this will affect developers who earn less than $1M annually from the App Store Sales. This is likely to lead to a small decline in commission revenues for Apple as around 98% of the app developers will qualify for this tax reduction from 30% to 15%, but all these small developers only contribute to about 5% of the estimated $50B in annual revenues from the App Store, so that would be only a $1.25B loss for the company, that is less than half a % of the company’s total net sales in the last fiscal year.
Also, these changes may lead to a potential long-term revenue boost, as it is likely this will lead to an increasing creation of apps which will generate more commissions in return.
Alongside this we also saw the company releasing the new MacBook’s with their first in-house chip, which promises faster video and imaging processing times, with both CPU and GPU performance up to 2 times faster than the latest PC laptop chip using just a fraction of the power consumption, with both of the macbooks promising big improvements in battery life. Apple is also expected to roll out even more in-house chips in future products, as they have started the 2-year breakup with Intel chips.
We also saw Morgan Stanley upgrading their base case to $191 at the end of November, as they have cited record lead times, supply chain forecasts and carriers demand as they expect that the company will sell around 270M iPhone in fiscal year 2021, that’s 50M more than the consensus and almost 30M more than the previous estimate of Morgan Stanley, with an average selling price of 842$, 9% more than the base case, as people tend to chose the more expensive and high tech versions of the lineup in this new 5G cycle.
The 5G super-cycle, which I believe is on the way, and will continue in the next years, as 5G become more available worldwide, could still be the biggest thing coming right away for the company with 5G smartphones expected to surpass 4G sales by 2024, with the average sale price of the 5G phones also coming down, helping them become more popular. This will also be helped by the recent entry to the Indian market, as India will probably become the world biggest country in the next decade, this could be a huge opportunity for Apple to start and take away market-share from their competitors like Samsung and Xiaomi which have the biggest market shares right now.
They also released an update iPad Pro and an all-new iPad Air in September which will also boost sales in this work-from-home environment that will keep the demand very high for this kind of products, just like the Macs. Alongside the increasing demand from the Wearables, Home & Accessories that include Air Pods, Apple TV, Apple Watch, and many more products.
But the biggest reasons I believe Apple is poised for continued growth, is primarily due to its services business, as they start to offer more and more services like the Apple ONE BUNDLE, which include up to 6 services from (Apple Music, Apple TV+, Apple Arcade, Apple News+, the new Apple Fitness+ and the iCloud service) for a pretty reasonable price in my opinion starting from 15$ up to 30$/month, this could be a great option for families and even individuals who use their services a lot.
The latest services, Fitness+ just launched in the past days, and is a direct competitor to the likes of Peloton, as the service is available on the iPhone, iPad or even Apple TV. This also makes consumers buy the Apple Watch which syncs to the other devices to show you different information. The Fitness+ app just on its own is 8$/month or 80$/year which is less expensive than Peloton subscription which charges 13$ or even traditional gyms like Planet Fitness at 10$/month.
I think this will be the fastest growing sector for the company, as this aligns with the new macro trends, as the world is moving more and more to a digital approach to almost everything as consumer preferences, with more & more younger people reaching the point in life when they use these services start to align to this increasing digital approach.
We also shouldn’t forget the Apple Card & Apple Pay service among many others which also seem to gain from the move to digital & contactless payments, as this has been accelerated due to the current situation in the past year.
And one last piece of news, and the most recent one, is that Apple may have fast-tracked the Titan project. The Titan project is targeting a 2024 or 2025 push to develop an electric vehicle with advanced battery technologies, that will deliver significant increases in range at much lower costs than the current technologies while also offering self-driving capabilities.
It’s reported they will not use the same technology as Tesla Full-Self-Driving feature, but will use LIDAR sensors, similar to those that we can find in the latest iPhone 12 PRO.
I think Apple can go 2 ways with this project, they can either use the huge amount of cash the company has to buy another car-maker like Ford, GM or any other car manufacturer expect Tesla and Toyota which do have a big market cap, so that they can fast-track the potential manufacturing of cars, or they can enter into a partnership with big companies like Tesla, Volkswagen or any other car marker to either produce cars or license their technology to this other car-makers which would ultimately and probably have higher margin-returns than the effective manufacturing of cars. Apple’s current overall gross margins stand at 38% vs the 15% average of the world top 10 automakers by market cap, which is significantly lower.
But this Apple Car thing is so far out, and there are so many unknowns, I will not try to predict anything related to this until there is more clarity on the subject.
And last, before moving on to some predictions, here are some of the highlights that we heard from the latest investors conference meeting, as the CEO, Tim Cook expressed optimism ahead with the launch of many new products and services, especially the Home Pod Mini and the new 5G iPhones, as these new iPhones include new LIDAR scanners that greatly improve the camera capabilities, as the iPhone as seen very positive reviews. We also saw the Senior VP and CFO, Luca Maestri give us great outlook for the company as they expect the installed devices base to continue to growth despite already being at an all-time high as they have over 585M paid subscriptions on their platforms and expect this to surpass 600M by the end of 2020.
I also researched and found what products we can see in the near future, with the first half of 2021 bringing new iMacs, the AirPods3 and the iPad Pro, while in the FALL event we will probably get the new iPhone 13 alongside the iPhone SE PLUS and the Watch Series 7 with more products coming later in 2021 or that don’t have an estimated release date like the Air Pods Pro, the Air Tags and the iPad Mini 6.
So, before even starting, you should know that I am bull on Apple but I am willing to hear other opinions so don’t be afraid to leave a comment down below.
I have made some predictions based on the growth rate of the company, the latest plans announced by them and used some estimates. So, keep in mind this are only projections and are calculated by myself, this is not an investment advice and you should do your own research.
This are my 2025 projections for Apple, let’s take a closer look at them, each on their own.
So, in term of revenues, Apple has 5 big sources of income, which saw an overall increase of 6% despite lagging sales in the iPhone. The biggest revenue is by far the iPhone right now with over $137B in revenue in the fiscal year ending in September. I expect to see the iPhone sales increasing in the next years, especially in 2021, with the new 5G iPhone creating a super-cycle for the company, as most iPhone users, including myself here, as I will upgrade from my iPhone X, will switch to this new product. The iPhone sales have decreased in the last couple of years by 14% and 3% as a result of the product not having big improvements, as well as iPhone usually starting to last longer than previous models, so I expect to see a 12% increase in sales next year and a gradual decrease in the growth of sales as more people upgrade, ending with just a 5% growth in iPhone sales in 2025.
The next revenues stream is from the Mac, which has seen an increase in the past 2years, with revenues topping $28B this year after the huge demand from the work from home consumers. I expect this trend to continue as they plan to continue to launch better products and I can see the company having a similar growth next year before starting to decline slightly until 2025, also ending with a 5% growth.
The iPad is currently the smallest revenue stream for Apple but has also seen an increase in demand in the past 2 years with a 13% average increase in revenues. I also expect the iPad to continue to grow in the next couple of years, especially with the learn-from-home environment for kids, and even after this period ends, the transformation for learning will implicate more digital usage. I expect the iPad to see some similar growth to the Macs, especially with the latest generation also bringing a new iPad air to the market.
The 4th revenue stream and the fastest growing in the past 2 years, with an average growth of 33% are the wearables, home & accessories revenues. This have topped $30B this year, as Apple has also just launched the Apple Watch series 6 and also feature other great products like Apple TV, the Air Pods the Home Pod and the Home Pod mini alongside other third-party accessories.
I gave this revenue stream a growth of 20% starting next year with a gradual decrease to around 8% by 2025, as I believe this will become more & more popular as they start to offer more vertical integration.
And last, but by no means least, the revenue stream that I expect to grow the most and the fastest is the revenue from the services that Apple offers. This includes revenues from Apple Care, Advertising, Cloud Services, Payment Services like Apple Card & Apple Pay and of course the digital content which includes fees from the App Store alongside subscription-based income including the new Apple One Bundle and Apple Fitness+ alongside the already know Apple Arcade, Apple Music, Apple News+, Apple TV+ and hopefully I don’t forget any others.
So, I expect this to become the clear 2nd biggest revenue stream for Apple by 2025, as I expect this to grow more than 20% next year, mainly due to the Apple One Bundle and Apple Fitness+ followed up by a slightly decreasing growth, ending with a 10% increase in revenues in 2025.
I think this are fairly conservative base case scenarios for the revenues, as I expect them to continue to increase the other revenue streams and not have such a large percentage of the revenues coming from the iPhone sales as you can see in this chart.
In terms of expenses, I pretty much kept the same margins as in previous years, with a 68% expense ratio on product sales [ iPhone / iPad / Mac / WHA ] and 35% expense ratio on SERVICES, as this are way more lucrative.
In the past 3 years, the products gross margin was 32.7%, so I actually imply bigger expenses for the manufacturing and sales of products, as this is mostly impacted by the company’s supplier’s ability to make up for and demand, while for the services revenue, the gross margins for the last 3 years has been 63.5% on average, but I expect this to be more in-line with the 66% margin in this past year. So, if services manage to grow to about half the revenues from the iPhone, this will effectively double the gross revenues, as every buck gained in the service revenues account for 2$ in the product sales.
So, I expect the total revenues for Apple to increase from $274B in 2020 to over $440B by 2025, increasing by approximately 10%/year, while I will keep the expense ratio pretty much in-line and have them increasing by 11%/year, this would bring the total gross income for Apple to $177B, increasing mainly due to the services revenues as I said earlier. This growth is just above the 4year average, and below the 2018 levels, which we might see again with this 5G super-cycle and explosive growth in the services revenue.
I also think the company will continue to invest in both Capital Expenditure and Operating expenses.
I think the operating expenses will remain pretty much in line with the previous years, as this number has increased by 1% annually both in R&D and SG&A. So, I will keep the exact percentages from previous years, as I expect the revenue to increase, thus I don’t see a big increase percentage wise. This would account for over $60B in operating expenses by 2025 and over $11B in Capital Expenditures by 2025, as I expect this to increase, mainly due to the possible EV developments or investments in self-driving capabilities alongside other manufacturing capabilities. You can see that the Capex spending has been decreasing in the past years with just over $8.8B in payments for business acquisitions and the other traditional Capex spending. Some people may use the cash generated by investing activities as Capex, but that is more unreliable. I also can see the Capex going back up, so I wanted to be safe and implied a 10% growth.
This money would account for over $73B in expenses and would bring the profit for the company to almost $104B before interest and taxes.
Moving on, let’s see what interest income and expenses the company has had in the past few years. We can see a decrease in interest expense in the past few years as the company has been paying off debt, but they have also been generating less money in this department, with an overall decrease in this department of more than 50% in the past year, way less than the amount from 2018. So, for safety reasons, I used a 10% decline in both income and expenses related to interest, while increasing the other losses by 10%/year.
This would bring the company pre-tax income to just over $104B in 2025.
Let’s move on to taxes. I know the Federal income tax rate is 21% for the company, but the actual effective tax rate for the company was lower than 15% in the past year, mainly due to lower tax-rates on foreign earnings alongside tax-benefits and tax-settlements. The average effective tax rate has been just over 16% in the past 3 years, but with more and more of the revenues coming from outside the US, I think it’s safe to say that the company will have around a 15% effective tax rate by 2025, this obviously if nothing major changes in tax policy around the world.
So, Apple would have $88.6B in income after tax by 2025 and with the current outstanding shares standing at just under 17B, so I don’t even account for the company probably continuing to do share buybacks, this would mean a $5.22 future earnings/share. And with today’s price for Apple just around 136$, that would mean to company is trading at just over 26 times forward price to earnings.
I don’t think Apple will ever trade at a discount again, with the current PE standing at over 40, I believe this will eventually go down, probably to around 35, despite the increase in services revenue, which is highly valued by investors. I think we can see Apple trade somewhere near 35 times P/E in 2025, especially if something big happens with the EV project, this could be even higher, just look at Tesla which trades at insane P/E. Of course, we also have to take into consideration the dividends that will be received from owning the stock, as Apple has started to pay dividends almost a decade ago and has 9 years of dividend growth, with a 10% annual rate of growth in the past 5 years. Here is the dividend growth history for the company, as I also went conservative on this estimate and implied a 7% growth for the next 2 years, 6% for 2023 and 2024 and just 5% in 2025.
So here are my 3 price targets for the company, including dividends but not reinvested. My bear case scenario is that Apple will trade at almost 165$ which implies a return of over 21% by 2025, while my base case scenario would see Apple trading at 195$ with a return of capital of 43%. I will also make the bull case for Apple trading at 225$ by 2025 with dividends included, which would imply just over 65% in gains by then.
I think this is possible as Apple has also continued to buy back shares of the company on a constant basis, as they continue to an impressive campaign with over $72B worth of common stock repurchased in 2020. They continue to buy back shares at a very fast pace, having repurchased over 1.3B shares in 2019 and 2018, while also issuing less stock every year.
So here is the full spreadsheet that I have projected for Apple by 2025 and the breakdown of everything i estimated [ 1 / 2 ] , if you do have another opinion or a suggestion please leave a comment down below, I think I have been conservative in most of my projections, but feel free to give your opinion.
Keep in mind, these targets might sound ridiculous, but just look at the growth Apple has had in the last 5years. The company has increased in value by more 400% in just the past 5years and is over 100.000% up since it started trading. So yes, the valuation is mad right now for the company. So, are you willing to bet against Apple?
The company also has pristine financials, with more than $65B in total assets compared to total liabilities, and more than $38B in cash and cash equivalents.
So, what do I expect in the next couple of days, weeks and months for Apple?
Let’s look at this CHART, so starting with the stock split, Apple saw a correction within the September stock market pullback, in a buy the news & sell the event, after a huge runup post-announcement of the stock split. The stock entered a consolidation period, and didn’t have any big catalysts, especially with new iPhone lineup not being included in the Q4 results due to the late launch. The stock found some levels of resistance near the $120 levels that it struggled to get past but acted also as support after breaking them just before the recent news of the possible EV developments or self-driving-features to be licensed to other car manufacturers. After that news the stock spiked and has now reached the previous highs made before the stock split and is facing some resistance, if the stock pushes over $140 I think we can officially say that it broke the resistance at those levels and is not just a fake-out. But I think it’s likely that the stock will consolidate between 122 and 135$ in the next weeks until the next iPhone sales and quarterly results are released, as the stock has entered overbought territory again with an RSI over 70, the first time since the stock split.
So, what would I do? Well, I own Apple stock, and I really believe this company will remain the biggest or one of the biggest in the future, so I would really add on any weakness that the stock shows before the next quarter earnings are released, as typically Q1 earnings are the best for the company due to increased holiday sales combined with the launch of new products. I think any entry below 130$ would be really nice to start and build a position or increase it if you already own the stock. As I believe Apple is one of the most stable stocks out there with large institutional holders like Vanguard, BlackRock and Berkshire owning over 900M shares each.
Thank you everyone for reading! Hope you enjoyed the content! Be sure to leave a comment down below with your opinion on the stock market!
Have a great day and see you next time!

In this post we are going to go through an in-depth analysis of Google, we are going to take a look at their fundamental value, their DCF, do a little technical analysis and set some price targets for the near future and for the long term
~Very Long Post~ [Don't Read Unless You Like DD]
Hello everyone! Let’s start by talking a little about Alphabet, they are one of the biggest companies in the world that generates most of their revenues and income from online advertising services provided through their platforms like Google Search & YT while also expanding into multiple other businesses like cloud services and autonomous driving technology through their venture Waymo.
The company was founded during the dot com bubble in 1998 and has more than 130K employees, with the company performing quite well in the past year gaining more than 30%.
I believe Google will continue to grow as their cloud platform will remain one of the biggest in the world, while also continuing to innovate and develop other emerging businesses that might turn out successful in the long-term, while their main competition is Baidu & Bing for the search engine, but their market share is still completely dominant, as they also compete with social networks & online retailers for advertising placements.
So, guys, let’s go a little through the 4th quarter & yearly results for Google.
Google smashed earnings expectations for the 4th quarter with a beat of more than $6 on EPS and $4B in total revenues.
The company reported a revenue of almost $57B in the 4th quarter while generating revenues of over $182B in 2020, representing a 12% increase over 2019 as they operating income also grew to over $40B for the first time despite a very slow start to the year through the first 2 quarters as their ad revenues were crushed due to the lack of travel & other leisure industries as those are some of the biggest advertiser income streams for them.
The company sustained a significant growth rate in the past year in their 2 major income segments, with their services business which grew by 11%, and the cloud services which also more than doubled their revenues, but the cloud services is still losing money as they keep investing into expanding their services to compete with the other major cloud players like Amazon, Microsoft & Alibaba.
The company has also started this quarter to report their google cloud results separately to give a more detailed view on how the company is performing, as we can now see how the company has managed to increase their revenues streams and how big the YT Ads revenues have become for them as those increased by 30% in the last year. Meanwhile the revenues from Google Search also rose by 6% and the Cloud Segment spiked by 46%, as they also have a big backlog in this segment.
So overall, the company has managed to increase their revenues in constant currency by 14% in the past year while also improving their operating margin by 2%.
Google has managed to keep growing and improving their business operation through major capital expenditures that have accounted for over $22B in 2020. I believe the big spending on capex is really needed, as the competition in the cloud segment in really heating up, so I like companies that keep reinvesting into themselves, as they have also spent over $27B on R&D in 2020, as they keep investing into most of their products and adding new ones in the pipeline.
Also, for the projections of the DCF it’s important to NOTE that they had over $13B in Depreciation & Amortization in 2020, with this number growing between 15-30% in the past 2 years so I while use a 15% increase for the DCF to be safe. The other big number that is important is their overall capex spending, which has gone down in the past 3 years, but as things might ramp up again as they mentioned in their earnings call, I will continue to grow this spending by 2.5%/year expecting things to normalize after the company went for a safer approach in 2020.
Alphabet also managed to increase their earnings before interest & tax or EBIT which stood at over $41B while also buying back 1.6% of their total shares in the past year, as they continued buyback programs in the 4th quarter of 2020, buying back over 4.7M shares in just the last 3 months, thus continuing to reward their shareholders even more.
There are a couple of negative outlooks for the company though, as their effective tax rate has increased in the past years, and this might continue to go higher depending on future tax reforms so I will take into account some small raises in the tax rate.
The next problem is the regulatory pressure which can be another bump in the road for Google, but I mostly expect things to drag along and may eventually end with something similar to what happened to Microsoft. Even If they somehow end up breaking their businesses, I think we can see the Cloud business trading at insane P/Es which would increase the actual value of the resulting stocks, while the search engine and YT will remain very powerful even without the contracts with OEMs, which would result in better margins and less operating expenses, as most people would still turn to Google for their searches and videos.
The final problem for Google is the privacy issues, but it seems they have found a way to substitute the traditional cookie technology with a new software interface called Federated Learning of Cohorts.
This technology seems to have at least 95% of the same power of conversion per dollar compared to cookies which would be a huge boost to their privacy issues concerns and will help them maintain their dominance in the online ad’s world.
But this isn’t the only technology Alphabet is trying to develop, they still have other proposals in works as well, which might come in even better, so we will have to wait and see what they go with.
Meanwhile, Google also offered some guidance for 2021 as they expect easy comps in the first half of 2021, while they are planning to ramp up the pace of investments this year.
They also expect to keep investing in cloud segment as their backlog which stands at $30B is mostly attributable to the cloud segment, as Alphabet will continue to focus on long-term growth that will benefit them in the long run as operating results & margins go.
For the price targets, I have made some predictions based on the growth rate of the company, the latest plans announced by them and used some estimates and expectations. So, keep in mind this are only projections and are calculated by myself, this is not an investment advice and you should do your own research and so on…
So, let’s start with the discounted free cash flow PROJECTIONS to see what the current valuation of the company is.
I used their total revenues projections that we will discuss later in the long-term projection, and the net income for 2020, to which I added back the Depreciation & Amortization costs they had in 2020 and got to an EBITDA of almost $55B
For the next years I used a small increase in EBIT margin which I think they can achieve pretty easy and also applied a 10% decrease in their net working capital.
I increased the capex spending and their D&A as I previously mentioned, so, for an 8% discount rate, which is pretty much the average SP500 return in the past decades and is what I like to use as a discount rate, given the current low interest rates, we get almost $190B Discounted Free Cash Flows by 2025.
Now there are 2 methods of doing the valuation, either the perpetuity method or the EBITDA multiple method, but for both of them we do have to subtract or add the net assets or debt of the company, which in this case stand at a net $200B in assets. I personally think a use of the average is better suited for most companies, though most of the companies trade largely on the EBITDA approach.
If we do use the growth approach, we can see that GOOG is slightly overvalued right now, as this implies a loss of about 5%.
On the other hand, a good EBITDA multiple for the company I think is about 20, as the stock currently trades over this multiple, but for safety reasons, I think 20 is pretty reasonable.
And given this multiple & approach we get a valuation of over $2700, or a 32% undervaluation of the company.
But as I said, I think a use of the average is best, so, my current price target for Alphabet in 2021 is $2326, implying a 13.3% return from the last price.
Guys, next let’s move on to a longer-term valuation of the company based on the growth projections I have for Google.
For my PROJECTIONS I actually just used their full year results and implied different growth rates for each revenue stream.
I think we can continue to see 50% growth rate in the Cloud segment for 2021 as businesses keep needing cloud services more & more, and then implying a gradual slowing of their growth rate.
For the Google Services (which include Search, YT & other revenue streams) I implied a 12% growth, just above last years, as YT keeps booming and the leisure industry advertising will slowly come back. But, for reasonable purposes I also implied a gradual slowdown of this trend by 1% each year.
I believe these growth implications are pretty reasonable giving the high market share in the search segment and the demand for cloud services platforms.
The 2 other revenues streams which are Other Bets & Hedging I pretty much left unchanged as they don’t really have that big implications on the final number, but I did add a small amount of growth in both of them.
For their cost of sales, I started from the current ones and maintained them for 3 of their segments, while for the Google Cloud cost of sales I implied a gradual improvement of about 14%/year. So, I am implying they reach profitability by 2024 and reach somewhat of an AWS type of profitability by 2025.
Guys, if we add all of these up, it means for 2025 we would get over $334B in revenues and $237B in expenses, resulting in a gross profit of almost $97B.
I also maintained the same capex as in the DCF while for the interest income & other incomes which stood at almost $7B this year I implied small annual growths, thus leading us to a $75.4B in earnings before tax.
I also slightly increased their 16.3% effective tax rate to about 17.5% by 2025 in order to somewhat account for possible tax changes in the future and also accounted for some share buyback programs of about 1% each year.
So, for the $62B in 2025 revenues after tax and accounting for 653M shares, that would mean a $95.25 earnings/share, meaning the stock is trading at almost 22 times forward price to earnings for 2025.
Guys, for my personal projections I like to use Forward/PE valuations & multiples, so, with the current projected PE and depending on what PE you assume for the stock between 25 and 40, the stock can trade between $2381 and $3810.
After all these estimates what are my price targets?
HERE are my actual price targets… I think the 2025 bear case price we can see Google trade at is $2619 which would imply a return of 27.5%, while my base case and my pretty safe assumption is that Google will trade at 3095$/share by the end of 2025, implying a 50% return on the current price.
My most bullish case though, would see the company trading at $3572, which would imply a return of almost 74%.
So yeah guys, these are my Overall price TARGETS for 2025, my bear case is an average of the 25 & 30 PE ratio, while the normal case is the average between the 30 and 35 PE’s with the most bullish case valuing the company between a PE of 35-40.
I think these are pretty reasonable targets, as the cloud services will continue to boom in the next decades, while they will also benefit from an increased reach for their search engine and booming YT platform as more people are getting internet access each day, and we shouldn’t forget that they might have even more great products in the pipeline with interesting names like Waymo.
Alphabet also has very good financials, with almost $320B in assets vs just $97B in total liabilities, which can be easily paid by the current $137B in cash, cash equivalents & marketable securities.
I also like to take a look at what the estimates are from the other analysts, and in this case, we can see an average EPS estimate by 2025 of $117, which is way higher than my $95 EPS estimates.
The analysts also expect over $370B in total revenues on average, which is also more than $35B ahead of where my targets are pointing, so, I think it’s safe to say I have been pretty conservative & reasonable with the growth expectations for the company.
You are probably wondering, what do I expect in the next couple of days, weeks and months for GOOGLE?
Let’s start by taking a look at this CHART, we can see that Google was trading in an increasingly tighter wedge formation since the September lows. Right now, after smashing the earnings report the company has re-entered overbought territory with an RSI of over 70, which we haven’t seen since the big September sell-off. This breakout from this wedge formation came on the back of massive volumes for the stock, so I believe we can see the overbought conditions push the stock lower in the near-term before eventually going back even higher as I expect with my $2326 prediction for the end of the year.
I also think the $1920 to $1935 range can act as future support after it was a good resistance point for the stock.
But, let’s also take a quick look at what 44 analysts on Wall Street are saying. They are mostly very bullish on the stock with an average price target of $2171 and a high price target of $2610. So, guys, I think the analyst still have some catching up to do with upgrades to the stock after the recent earnings report.
Are you asking yourself, what would I do?
I believe it still has plenty of room to grow, so I would start building a position if the stock drops under $2000 and especially buy more if it goes to the previous resistance levels between $1920 and $1935
I also believe that the big % of their shares held by institutions, with over 72% of the float being held by big funds like Vanguard & Blackrock does significantly reduce the sell-off possibilities and increase the support levels power.
So, these are my projections and my expectations for the company, I think Google has a terrific future ahead, with their market share of engine search worldwide crushing the competition and the hole digital ad spending worldwide forecasted to continue to grow and take share of the total ad spending worldwide.
I believe Google will remain one of the best companies in the world while also being a good catch-up play to the other big tech names, as Google has underperformed compared to most of the other big names with the exception of Facebook.
Thank you everyone for reading🙏 Hope you enjoyed the content! Be sure to leave a comment down below with your opinion on the stock market! Have a great day and see you next time!

WARNING: 8TH GRADE READING LEVEL REQUIRED FOR MATERIAL

Intro/Disclaimer

yeah its long as fuck, but read for tendies. If its too long suck a bear dick and move on. This is real analysis of the business model, not just a bunch of emojis. It is so long because of the niche field it is operating in and how a lot of key points are not understood well by the WSB community. This company really is a diamond in the rough and a great way to play future trends with less risk as you're not picking winners. Its the "picks and shovels" play of electrification and renewable energies. I'll explain the realistic case for how this company is soon going to be running the best tendie mine for decades to come.
This is my second DD post on now $MP, formerly $FVAC, and i'm back to discuss the developments of the company since my pre-merger post and add some further analysis about the valuation of the company and its future. There has been too much really shitty DD from both bulls and bears on this companywhere very few people on here have a real understanding of this company, their business model, and the future.
First - read my original DD post in order to have a decent understanding of the backstory cause I'm not about to type out all that shit again or explain what I've already written. Read that first then come back:
https://www.reddit.com/wallstreetbets/comments/jgvarn/fvac_dd_evchina_tension_play/
That post discusses mainly international tensions and the role REE's but this one i'll speak more on the business case of this company and how even without geopolitical tensions it is a true tendie mine.
Second - no I'm not a bag holder Ive been in since it was a pre-merged SPAC my average on my shares is about $14 and my LEAP is far far ITM and no I'm not selling any of them. Also, as i referenced in the post I work in a very similar field and interned in college at a mineral mine in the refining aspect as a chemical engineer, so while I'm not an expert at this I have more insight than the average retard and I am trying to give out tendies before the boomers take them from us. I will try my best to explain the business model of a mining company and why this company is the most unique and interesting way to get tech company level growth with the associated free cash flow while not having to be anywhere near as innovative. Ill discuss a lot of the bear arguments for this company as well and try to de-bunk them as most don't really hold water once you look into them the slightest bit.

Background of NdPr

While the company produces as basket of Rare Earth, the plant is aiming to focus on NdPr and other permanent magnet materials in order to play the trend of EV's and electrification. These magnets are extremely important for so many technologies due to how Electric motors work. To put it simply, at current technology the only way to convert electricity to motion or the only way to convert motion to electricity relies on permanent magnets. Im not gonna try to explain more than that because I too am retarded but if you don't believe me or want to learn how watch this video:
yeah i know you didn't watch that video, but just imagine you did and now believe me.
However, because it works both ways BOTH electric motors AND electric generators rely on this technology. This is key for understanding how NdPr is the best way to play both the trends of electrification AND renewables. First, electrification is most embodied by the rise in EV's in the future, and while that is predicted to be the fastest growing segment of NdPr demand it is foolish to not to account for other evolving technologies reliant on electric motors as well. Robotics will be a huge growth market and electrification of other industries will rely on NdPr permanent magnets. The other massive growth opportunity for permanent magnets is through renewable energies. Wind energy (and possible future motion based energy harvesting tech like tidal energy) work through harvesting mechanical motion and turning a generator to create electricity. Wind power doesn't work without electric generators which don't work without magnets. In addition, wind tech is advancing down a path to require even more magnets due to improvements is Permanent Magnet Direct-Drive (PMDD) technology from the current Gearbox doubly-fed induction Generator (DFIG). Essentially what that means is the new technology will take out the gearbox currently used in wind mills and replacing them with more efficient direct driving technology allowing more mechanical motion into electricity. These new generators require stronger magnets, thus more magnetic material. Read more about that here:
TLDR: They mine mainly permanent magnet materials that at current scientific understanding CANNOT be replaced due to their unique electromagnetic properties.
TLDR on the TLDR: Special Rocks no replacing. Need special rocks.

$MP's expansion plans

A lot of bears like to bring up the fact that $MP is still reliant on China to do their refining and they're correct... for now. Currently they mine on site and refine to REE concentrates which they then send to china to refine into Rare Earth Oxides (REO's), which then get send to become metal alloys and then finally to magnets. Currently is the only location in the world to refine past concentrate material so $MP is forced to send their material there, but that is why the went public. The intent of them going public was to raise funds in order build an on-site REO facitility, which is scheduled for completion in 2022 and is already started. They already have enough cash on hand to furnish this upgrade as they had over $500M on hand at the end of Q3, and they also are a cash flow positive company already before even moving downstream. There are EV infrastructure plays with much worse valuations and years away from breaking even on cash flow, yes I'm talking to you $QS bagholders... that tech is unproven and there are so many battery competitors in a field where there WILL be a winner
Why would they want to move downstream when they're already profitable??? Because the further downstream they go the higher margins they earn and the more tendies they can mine for us. Refining raw materials to useful materials is a value adding process and thus creates more value for the company that does it. Once they complete this expansion they plan on going to stage 3 of their business model, the ability to build magnets and other final products of REE's in America. They have not decided/disclosed their plans for this, whether it is through construction of an onsite facility, an acquisition, or a joint venture, but it is in the plans. This is expected to come online around 2025 and when the insane cash flow can begin for the company. I don't have any reason to doubt the validity of their intention as its just a continuation of the business model they are currently implementing and the majority of the corporate rhetoric is related to "mine-to-magnet" and "restoring the REE supply chain to America."
What does this mean for the company? as they move further and further downstream they will increase their margins from this action alone, but it gets even better. This can be shown in their in-house calculations of their 2023 adj. EBITDA target of $252M

https://s25.q4cdn.com/570172628/files/doc_financials/2020/q3/MP-3Q20-Earnings-Deck-FINAL-11.23.2020.pdf
it is important to note that those numbers are from the current step they are taking right now in building the REO refining facility. Adding further downstream capabilities will only cause that EBITDA value to grow as margins improve, but next I'll discuss where their margins will improve from EVEN MORE.
TLDR: downstream expansion is a way to increase margins and therefore free cash flow for the company.
TLDR of TLDR: Special rock get more special. Get more tendies for special rock.

Business model of mining companies and why $MP has insane growth potential

\**This is the most important part of this long ass post, if you read one section, then read this***
A big disconnect on a lot of DD in this sub and analysis elsewhere is the economics of how a mining company works. A mine is by definition a COMMODITY PLAY, which I know is not as exciting as a tech company, BUT it will experience tech sector growth for a period of time and then experience a period of time in which develop into a cash cow business reaping huge dividends for shareholders.
What i mean by a commodity play is through the economics of how a mine operates. Given a mine at a fixed production volume, the costs on a year in year out basis are relatively similar. What i mean by this is the cost $MP to mine and refine into concentrate will be the same no matter the price of their product. However, the revenue they receive is dependent on the market price of their product, which is what varies the most. An easy way to describe this is through taking a look at their Q3 2020 financial results presentation:

https://s25.q4cdn.com/570172628/files/doc_financials/2020/q3/MP-3Q20-Earnings-Deck-FINAL-11.23.2020.pdf
That value of Production cost (at the current stage of just creating REE concentrates) will realistically stay the same as that value is from the cost of labor, energy for machinery, administrative costs, etc. While these numbers will vary from quarter to quarter these are costs not predicted to experience rapid growth and this is what is important to realize. It costs roughly the same amount of money to pay someone to blast ore, dig it into dump trucks, pay operators to refine into ore, etc. Don't trust me, look into how steel companies operate, like this sub's favorite $MT. The revenue they receive is dependent on the price of REE's, which is NOT PREDICTED TO BE FLAT. Here is the historic graph of Neodymium from 2011-current:

https://tradingeconomics.com/commodity/neodymium
**If you are an investor in $MP (which you should be) this is an important website to pay attention to because understanding the market dynamics of their product is important to understanding the valuation of this company. **
Allow me to disect that graph a little bit:
1st Peak: From the aftermath of the supply shock from 2010/2011 from the Japanese Navy and Chinese fisherman story i discusses in my previous $FVAC post i linked above. China lowered exports by 40% and the price shot up drastically as industries across the world tried to gobble up as much NdPr as fast as possible in order to ensure their production lines. That was then followed by china flooding the market and selling back that backlog. that caused prices to fall off a cliff and ended up taking molyorp out of business. I'll discuss the Molycorp saga later more in depth and the differences of them and $MP.
2nd Peak: This peak (late 2017) is from the Trade war trump caused with china and is another good explanation of the correlation between REE's and geopolitics i discussed in my last DD post. The middle 2019 peak is again the trade war heating up again.
3rd peak: where we are now. This is from the increased tailwind of EV adoption, more from asia and Europe than the US and because china has been threatening to use REE's as a political tool again, which again i referenced more in my last DD post.
However going forward if you want to predict the amount of revenue MP will earn its important to understand the market dynamic and I'd like to discuss why the price is geopolitics aside predicted to steadily increase at a very fast rate. MP, like any other commodity play, relies on the supply-demand dynamic of the sector, and REE demand growth is on track to far outstrip the supply growth. This will result increased prices per ton, but MP's costs stay the same. This is the beauty of the company, as the price goes up their margins go up too! MP and market analysts predicted over a 100% growth in NdPr magnets in the next 10 years:

https://s25.q4cdn.com/570172628/files/doc_financials/2020/q3/MP-3Q20-Earnings-Deck-FINAL-11.23.2020.pdf
Don't believe that metric? check this more in depth one:

https://www.arultd.com/products/supply-and-demand.html
This graph shows most important metric as it shows that the world at current rate is not scaling up to meet demand. THIS GRAPH INCLUDES CURRENT PLANNED EXPANSIONS INCLUDING INCREASED RECYCLING. What does this mean?? There is a huge mismatch in projected demand and supply and if you don't know what that will mean then ask your wife's boyfriend about supply-demand graphs from their economics class. The result will be massively increased prices of permanent magnet materials because the world will not be able to mine and refine enough to satisfy demand, so they will be able to increase their prices. BUT AS I SAID EARLIER, MP'S COSTS PER TON WILL REMAIN THE SAME. So what is the gist of this coupled with MP moving toward downstream expansion? MP's margins will increase incredibly from a double whammy of moving downstream AND supply-demand imbalance. Now what does that mean for you?? that means $MP has a very realistic and conservative path toward becoming a company with RIDICULOUS free cash flow.
What does that mean for MP? That means that the company will be raking in cash and will be extremely flexible due to their balance sheet. They will be able to expand operations or acquire competitors in order to increase their market share and production volumes OR they will be able to transition into a boomer dividend company that will pay you tendies each year. They could do either of those very easily because the company HAS NO DEBT. In fact, $MP ended Q3 2020 with $507M CASH on hand to finance their future expansions. Okay, i know dividends are boring but the market will begin to price in that future dividend potential and give your calls many tendies along the path to pricing in their dividend power.
TLDR: Supply demand imbalance (with geopolitical tensions as a wild card) will result in insane free cash flow in the future for this company.
TLDR of the TLDR: People want more special rock more than can make special rock. People give you more tendies for special rocks.

Why Supply won't be able to scale up as fast

A very important assumption in my analysis is the inability for supply to scale up as fast as demand and I'd like to explain this more in depth as it is the crux of this DD. This is where my experience in mineral refining is valuable as I can weigh in on this aspect. Over time there will be more suppliers that come into the business and we are seeing that already, however this is where the timetables of that come into play. Simply put supply can't go up because companies will be slowed greatly due to the time it will take to get up and running and the incredible amount of upfront capital needed before even starting up the mine. If a company is interested in getting into the field there isn't a fast path in because the companies can't just decide to go into the business and then go to the "REE refining machinery store" and buy the equipment and have them get set up. All the machinery in chemical manufacturing plants (REE refining counts as chemical engineering so hear me out) has a long path in order to reach the optimum design. Ill outline the gist of this here:

Lab Scale Testing: This is laboratory scale testing in which very small batches are prepared testing different procedures and methods in order to find the optimum refining process for the goals of the operation. This is when the deciding of the catalysts, solvents, additive chemicals, etc is done in order to decide what to do to the ore to get the best product.
Pilot Plant Design and Testing: This step in the design process is designing and building a small scale model of machinery to run the process decided upon in lab scale testing in order to determine different operating conditions, determine control points, etc. This is when different tests and procedures are determined and also a proof of concept to begin economic calculations for designing the next step.
Full scale design and building: This is when the full size, real-deal machinery is designed and constructed. But again, there is not "REE refining manufacturing store" to get much of this machinery. Refining plants are custom designed (minus certain machinery like pumps and basic ass shit like that) and custom built. These are custom designed, custom fabricated large scale machinery designed in every aspect from material, area, volume, and depth in order to lower manufacturing costs while also allowing for 24/7 continuous operation. The 24/7 operation aspect is important because it is why the machinery is designed so meticulously. The most economic operations are ones that require little down time and little maintenance and a lot of work is put in to optimize this aspect. That means it takes even more time to produce.
Permitting and Certification: Now at this point the company is years into the development of REE refining, but they still can't start operating despite the entire operation up and running. In the US, now the lovely and very fast government gets to come in. Mining and refining operations don't operate under OSHA rules and procedures, they get to operate under OSHA's much meaner, expensive, and safety prone brother, the Mining Safety and Health Administration (MSHA). Government inspectors have to come in and permit and certify EVERY PIECE OF MACHINERY, inspect every single moving part and permit them, and do a shit ton of other stuff for the government to allow you to begin operations. Now due to the stimulus bill's provisions toward stimulating REE capabilities in the United states I assume that MSHA will be (or already has been) told to prioritize REE companies and they will probably be fast tracked, but even fast tracking them will take a lot of time. In addition EPA has to come in and sign off on the environmental plans of the company and probably even more government entities will have to come in to sign off on stuff that was past my exposure when I interned in the field.

Now you've seen how long it would take to get up and running, but another constraint worth mentioning is who does these? Larger Chemical or mining companies (Dow, DuPont, Chemours, BASF, etc) looking to enter the field probably have their own design teams that would be able to do it in house. Smaller, non-conglomerate entities would have to hire a chemical engineering design/consulting firm to come in and do the designing, write the procedures, and train the production engineers and operators. That means there is some decent intellectual constraints as to how many people have the know-how to design at the rate needed to scale up.
Here is what is important, any entity trying to enter the sector will have enormous upfront costs in buying the land, designing the plant, buying the machinery like excavators, dump trucks, pipelines, pay employees well before starting due to training on the machinery. Im not sure the exact amounts of money needed but it would easily be in the 100s of millions at least. Then once all that upfront capital is sourced, plant designed, people trained, etc the operation would take YEARS to get out of all that debt and achieve meaningful positive cash flow. It is only a matter of time for $MP to have significant domestic competition, but by the time these operations could begin operating $MP will be so far ahead in production and have a significantly stronger balance sheet than these companies could have. $MP will remain years ahead of any other domestic competitors, even though competition will come.
TLDR: At current outlook supply growth won't match demand growth and even if more competitors pop up to compete it'll take years to start operating and even more years to match $MP's ability.
TLDR on the TLDR: Not enough people finding special rock. More people want special rock than can get special rock. They pay more for special rock.

$MP's competitors, both domestic and international

A large argument that bears like to make is that competition is coming in the US, and they are 100% correct.... but it won't matter because AGAIN this is a commodity play, not a tech company. They make magnets, their revenue will depend on the price of their product. Buyers from this are not looking at $MP like you would look at $TSLA vs. $NIO or apple vs android where you could argue one is better than the other or consumers will adopt one over the other. There isn't brand recognition, increased utility, or consumer favorites in magnets, they're fucking magnets. Think about it like another commodity, lumber. If you go to $HD to buy some wood you aren't staring at two different planks of the same type of tree and picking one because of which timber company felled it or which milling company milled it. You just buy lumber and go home because it is wood. A timber company isn't outright threatened by another timber company popping up, as long as the demand-supply dynamic in the market stays the same the first timber company is unaffected. That is why it won't matter WHEN more domestic and international competitors pop up. As long as demand outstrips supply then commodity companies will make more and more money. Now I am not trying to bullshit people so I'll discuss the international and domestic competition, but Ill explain more in depth why i don't give a shit about them.
Domestic: The ticker that cannot be named due to it being banned. If you take a look at that company it is a Uranium producer that is going to re-purpose machinery onsite from uranium production to REE production and they have successfully done pilot plant level processing. However if you analyze their production numbers you'll see that the scale they plan on producing is not quite at the level $MP will. They plan on refining 15,000 tons of ore per year with an estimated 55% REE concentration, which leaves an estimated 8,250 tons of REE per year, of which 22% is NdP (all their numbers not mine), which leaves annual production of 1,815 tons/yr. These numbers are pretty good and I do own a stake in this company because I like the potential, but its scale is not quite the scale of $MP. $MP is predicting a run rate of 6,075 tons/yr of NdPr, so yes the banned ticker is a decent competitor but its only predicting to be 1/3 the size of $MP annual production volume. A downside of the banned ticker is that they still are focusing on Uranium production so its not a pure REE play, but Uranium has a pretty decent bull case for the future so i don't want to slander that ticker too much. However, again, these are commodity plays, $MP having competition, even domestic, doest really affect their business plans or bull case. Additionally, the banned ticker is sourcing its ore rom Chemours' location in GA, but getting milled in Utah, so this is a long term inefficiency to consider as well that $MP won't have to worry about once their stage 2 REO mill is complete. the banned tickers financial health is pretty decent, but its market cap is $516M at close 1/4 which is just slightly above amount of cash on hand $MP had at the end of Q3 2020, $502M. That company is more of an investment opportunity than a competitor, if its even worth investing in.
Other emerging domestic competitors: link to article explaining them all Im not going to go deep into each one but you can see that many are slowed down to the process I explained above about how expensive and time consuming it is to reach operational status. These companies will be coming online, but won't be profitable for a while and won't be able to provide the same returns to investors for even longer.
International competitors: Lynas Corp. This is an Australian mining company that has also received pentagon funds to improve the non-China production capacity. They trade over the counter and are a real deal competitor and also worth investing in but their growth potential isn't as clear or easy as in the US. They have pentagon funding more so out of desperation by the pentagon to get more production in the western world than loving to invest in an Australian company. In the future I would imagine a lot of this government support will go toward US based companies.
International competitors: all the china ones. yes they produce the largest amount of material in the world and do it the cheapest but this is the result of none to very little environmental protection. Once the supply chain can go "mine to magnet" many companies will look to diminish their exposure to chinese companies to ensure their supply chains are not at the whims of the Chinese government. In addition, $MP is the cleanest REE mine in the world and a lot of environmentally conscious companies will want to support clean mined REE's and once domestic production is high enough there could be regulations passed to further incentivize purchasing domestically produced REE's.
All these companies were included in the forecast of supply in 2030. Even with these companies coming online $MP is still positioned for incredible returns.
TLDR: Yes competition is coming, but there is already competition. Its also a commodity play so its not facing replacement or redundancy like many other growth markets
TLDR on the TLDR: Others find special rock. Your special rock still worth many tendies. You still get many tendies.

Why this is NOT molycorp 2.0

The most common point of argument against this company is that people bring up the fact that the mine $MP operates used to be run by Molycorp, which went bankrupt. However if you read into that transaction it really isn't that scary. Molycorp did go under but this was in a period of price instability and they were not running as good of an operation. Molycorp operated during the 2010-2011 peak of REE's when china restricted supply. Molycorp stock went up a ton in addition to their revenue and thus they decided to invest in milling capabilities to create REO's (I know this is $MP's plan but don't get scared yet). Because of US EPA restrictions it was wildly expensive and at bankruptcy they had $1.7B in investments into capital projects to improve their refining capability, but the subsequent REE price collapse when china "turned the taps back on" to the world supply caused them to not afford operation. The site then changed hands back and forth until it was bought by $MP's current management for $40M. They then invested in it after literally buying for less than pennies on the dollar and got it up and running more efficiently than before. Last quarter Q3 2020 they ran 3.2x the REE concentrate production volume than Molycorp ever did:

https://s25.q4cdn.com/570172628/files/doc_financials/2020/q3/MP-3Q20-Earnings-Deck-FINAL-11.23.2020.pdf
They got to buy over $1.7B worth of investments for $40M and have proven they have turned those investments into operating profit. In addition, previous operations prioritized Cerium production for FCC catalysts. $MP has transitioned the goal product to be NdPr as it has much better growth potential to give it long term possibility. In addition, the market climate Molycorp operated under was not as forgiving as now. Back then there wasn't the tailwind of increasing EV adoption, or the rise of other high tech growth sector reliant on REE's. Molycorp was too early and inefficient to win in the market and didn't have anywhere close to the amount of governmental support for the industry. There is bipartisan support on all levels, i mentioned this a bit in my last DD post, but since then - and this is big and shows the scale of gov support- THE LAST STIMULUS BILL HAD $800M IN SUPPORT OF INCREASING DOMESTIC REE PRODUCTION! Molycorp didn't have anywhere close to this level of government support. And again, the pentagon invested $9M into $MP to help fund their REO mill because the pentagon views the ability to refine REO's as a matter of national security.

Discussing Concerns about Biden Presidency

People who say this shit clearly have no idea what they are talking about. Biden (or his puppet masters but who cares money is all green) has said he supports REE mining multiple times source. His team knows their big environmental initiatives rely on REE production and that domestic production is important to keep American industry at the whims of China. Yeah Trump was more hawkish with china but lets not act like a democratic presidency is going to let china walk all over the US or that Biden and other democrats will stop their push for EV's and clean energy. REE's are a cornerstone piece to so many of Biden's plans there is no way he turns his back on this company.

Discussion of Shenghe Resources and China and their relationships with $MP

The one real concern that people have is their partnership with Shenghe Resources where Shenghe has agreed to buy all $MP concentrate through 2021 and shenghe is a stakeholder in $MP. Many view this as a negative, but i think it should be seen as a good way to ensure survival in the gap between now and the final magnet production. A big issue would be if China chose to stop importing the MP concentrate, which would give MP no customers. Since this would adversely affect Shenge it makes it less likely and also the fact that MP produces 15% of the world's REE concentrate it would hurt the supply in china, which is huge. In fact, China removed their 25% tariff on importing REE material, read this source as it also shows how china is buying up all the concentrate they can. Japan has the capability to go from REO to NdPr magnet as well so if china ends up fucking MP, starting in 2022 when their REO site is in operation then they will be able to sell their REO to Japanese companies to bridge the gap before they have their own magnet making capability.

https://s25.q4cdn.com/570172628/files/doc_financials/2020/q3/MP-3Q20-Earnings-Deck-FINAL-11.23.2020.pdf
China is not likely to fuck MP and stop buying their concentrate as it will hurt china's wallet and ability to produce goods while only increasing the US government support for going mine to magnet domestically. China realistically views their dominance as ending at some point now, but they know they will still be able to control the market because of their scale regardless of whether they buy MP concentrates or not.
Also, if Shenghe doesn't buy their concentrates then they forfeit their stake in MP. they wouldn't be allowed to sell them on the market, the shares would just disappear, so it would effectively be a massive stock buyback and as long as the REO mill is complete then they just sell to Japanese magnet makers.

Mine Life discussion

Their S-1 states that at current proven reserves they have about 47 years of mine life left. That can be grown from drilling and exploration of more mineable material, which they stated they plan on doing. in addition, if they for some reason don't find more mineable ore on their land and don't buy more land with ore, then they could simply refine ore from other mines as the real cost barrier isn't the digging out of the ground, it is the milling.

TLDR

$MP will to the moon over the next few years.
Postions: shares for virgins and LEAPs for chads.

Edit: addressing $QS collapse today (1/4 after a -40% on $QS) and the associated EV infrastructure. I think $QS hitting the shitter, well, predictable. People flooded to it as a result of attempting to find a parallel way to play the rise of EV's without understanding the company. $QS is a solid state battery technology, but I have never held a stake in it because, well, all it is is an idea or concept. It fell today as a result of a report criticizing the basis of its technology and I have to agree, the tech is not proven and even if it works as advertised there is a question of whether it could ever solidify its valuation, even after its collapse today. Solid state batteries MAY be the future, but for now their real place is in university and R&D laboratories as the tech is not proven to work as advertised. They are in the same situation as liquid metal batteries, cool ideas without the proof they will be successful in the market. HOWEVER, $MP is a way to play EV's & Renewable energy without the risk because $MP is not relying on scientific breakthroughs, it is a commodity producer. They don't care who wins the EV race, the battery tech or company that wins the battery race, or the wind energy companies that win contracts, all they care about is the mass adoption fo those technologies. It is a unique way to play these trends without having to bet on winners or losers in the field as you're betting solely on the industry. The company is positioned to benefit greatly regardless of who wins and lets be real, the market is incredibly saturated with companies that won't win. Look at all the different EV makers big and small, the different battery companies, etc. I have a tough believing that all the small EV makers will have a shot when the large auto companies get more involved. I believe the best way to see profit without that risk is through symmetrical bets with no breakthroughs needed, just the market to develop
EDIT 2: Further DD/ another take. Yeah maybe 1 person will actually read it but it’s a lot shorter than mine, really won’t take long to read the thread. It is not my DD but rather an obscure Twitter account I have no connection to but they bring up further interesting bull arguments and address current valuation better than I can. I have no finance background so I didn’t try to pin a price or movement. https://twitter.com/dawn_capital/status/1346134740659818496?s=21
Edit 3: Research report from brand essence research estimates that REE market size is expected to reach $20.6 Billion by 2025, significantly higher the the 11 billion size from 2019 with a CAGR of 8.2%. MP currently produces 15% of the ore in the world and in 2022 is expected to be milling REO. Let’s say global production does increase and $MP doesn’t expand out and falls to 10% of global supply. That’s still about $2 Billion in revenue with higher margins than they operate on right now because of REO production.... it’s a tendie mine🚀🚀🚀
https://brandessenceresearch.biz/chemicals-and-materials/top-growth-on-rare-metals-market-size-and-share/Summary
Disclaimer: this is my thoughts on the company and market, yet I am on this site and also retarded. I am long via shares and call and am a true believer in them but best in mind my confirmation bias. Not investment advice, do your own DD, buying and selling $MP is your own decision

I will skip long names of new laws and full forms of APMC and MSP since I assume everyone has got familiar with them now. Let's get directly to the points.
From the perspective of a farmer
If you are a farmer who has been growing wheat and paddy and selling it to APMCs, then new laws will cause you some inconvenience in the long run. Still, they will bring more opportunities in the long run if you can shift your farming from wheat and paddy to commercial corps, which is the primary intent behind these laws.
MSP is the reason farmers stick to wheat and paddy. These corps are their comfort zone. They are growing them for generations now, and they have full insurance of their sell through MSP. These farm laws will surely kill APMCs and MSP, but in the long run, the govt already said that they are not going to shut APMCs. But let's not kid ourselves; the laws are intended to replace the APMC system. If these farmers can go outside their comfort zone and get into commercial corps or FMCG collaborations in the next decade, they can earn much more than they are making now. The logic is, wheat and paddy are very basic corps. Every nation ensures that they are self-dependent in these corps, so international prices for these corps are already lower than Indian markets. Unless farmers move to commercial corps, their income can not be increased.
From the perspective of a Consumer
When a farmer is growing corps with MSP in mind, the best strategy for them would be to produce as much quantity as possible because at the end of the day govt will have to buy it no matter what the quality is. It leads to poor quality crops as loads of chemical fertilizers and pesticides are used for higher yields. Often the products are not fit for human consumption. In fact Agri products from APMCs can not be exported.
High pesticide content a drag on rice exports : The Tribune India
Excessive use of pesticides hurting basmati exports (dailypioneer.com)
These pesticides are one of the biggest reason Punjab is called Cancer capital of India. Water and land is contaminated due to excessive of pesticides for MSP model farming.
The wheat that most middle-class people eat(for example, Aashirvaad atta) does not come from APMCs.
From the perspective of an ExporteBusinessman/MNC/entrepreneur
Exporters have to satisfy the EU and US's quality norms, which means they have to ask farmers to grow specific varieties in a particular way, which is only possible by contact farming. Many pesticides are banned in the EU and the US, used by Indian farmers to get higher yields. Since farmers are getting fixed prices in the MSP model, there is no incentive to produce higher quality rice and wheat. With APMC as middle man it's impossible to raise exports of Agri products.
Rice exporters seek ban on pesticides unregistered in the US, EU - The Economic Times (indiatimes.com)
Basmati Rice & Pesticides: Where does the fault lie? - India Business & Trade, an initiative of Trade Promotion Council of India (tpci.in)
Similarly, if you are an MNC or FMCG company, you would only invest in Agri Research if your IP is protected by contract with farmers. McDonald's requires a unique variety of long potatoes for their fries, They will only produce it in India if their patent of that variety is protected by contract.
If you are an agro entrepreneur, you can manage your inventory and forecast if you already have a contract.
From the perspective of Govt/Macro Economics
Govt is expecting huge relief as they have to give loads of subsidies to farmers.
Dr Ashok Gulati calculates that every farm household in Punjab and Haryana gets about Rs 1.2 lakh in subsidies per year.
Similarly, govt has to buy all of this low-quality excess grain.
Food Corporation of India (FCI) is saddled with huge stocks of grains — it touched 97 MMT in June this year against a buffer stock norm of 41.2 MMT. The economic cost of that excess grain, beyond the buffer stock norm, was more than Rs 1,80,000 crore, a dead capital locked in without much purpose. That’s the situation of the current grain management system based on MSP and open ended procurement.
Source
Punjab needs a package to help it diversify output, overcome MSP trap | The Indian Express
Please note that the grain procured through MSP can not be exported due to thier low quality and pesticides. So this grain usually rots or sold at a very low price.
As the contract farming will gain track, exports will rise. MNC will establish their plant as Agri products are raw materials for FMCGs. These companies will invest in research and better equipment for their farmers.
From the perspective of the Environment:
I have already discussed that how MSP led farming is pushing farmers to chemical and pesticides. But that is not it. Due to rice farming in Punjab and Haryana, groundwater is depleting. Farmers are a strong lobby in Punjab, so they get free electricity without any restrictions on groundwater uses. They have also forced govt to give them subsidies on Chemical and Pesticides, banned in the EU and US. So farmers in Punjab use their free electricity and subsidized pesticides to fuck the shit out of groundwater and soil.
MSP, subsidies are at root of Punjab's farm crises but its farmers are fighting to keep them (theprint.in)
They have also lobbied to stop fines on stubble burning.
Farmers' Protest : Centre Agrees To Remove Stubble Burning Fine, Withdraw Draft Electricity Amendment Bill; Next Meeting On January 4 (moneycontrol.com)
My perspective with some economic analysis
I have a simple point. A mixed economy where supply is controlled by govt and exports and industries are owned by private players will never work. It has not worked so far, and we all have seen it. The reason is very simple; there will be inelasticity in the demand-supply curve. If you sell through APMC, you will never know what is the true value that you can produce with your land. Similarly, exporters and suppliers will never get what they want to satisfy the demand. The best bet is either go full commie and nationalize everything or let the free market decide.
Second, farming is a business of scale. If you have a bigger farm, you can diversify your corps, rent big machines include husbandry fishery in your farm, reducing your overall cost and risk. If you are a small farmer, you are doomed to fail as you can never diversify, and your cost per unit of production will be higher. It's go big or go home situation. Our governments try to keep small farmers in business by waiving loans, giving subsidies, and MSP. These all measures keep them in a vicious cycle which can never end. If govt can use this money in the manufacturing sector and shift these small farmers to factories, it will save their next generation.
EDIT
Some people are pointing out on how farmer are denied access to courts under new law which is true for civil courts not revenue courts.
There are two type of courts Civil courts and Revenue courts. Matter related to agriculture are under the jurisdiction of revenue courts which are headed by SDM and DM. Civil courts are already. 'M' is SDM and DM stands for magistrate, and they work as Magistrate in revenue courts.
Revenue Court in sub-section (1) means a Court having jurisdiction under any local law to entertain suits or other proceedings relating to the rent, revenue or profits of land used for agricultural purpose.%20%22Revenue%20Court%22,to%20try%20such%20suits%20or)

In terms of humans, the United States Army can easily fit ten pounds of shit into a five pound bag. There is no room to swing a cat in the numerous vehicles I have been subjected to enter. Capacity is the objective, and comfort is meaningless. "We're going to pack you into a cattle car, then pack you into an airplane, and then we are going to pack the sky full of Paratroopers! The old life changed after Assessment and Selection, and I found myself flying "White Tail" (Commercial Air) more often than "Gray Tail (Military). However, flying White Tail is not without issues.
My second deployment to Lebanon was "Planes, Trains, and Automobiles." My initial flight out of Baltimore Washington International (BWI) was canceled without notice. It was time to call the Travel Princess who coordinates all our civilian travel.
Ring! Ring! Ring!
Travel Princess: Hello
Sloppy: Hey Travel Princess. It's Sloppy. My flight out of BWI was canceled.
Travel Princess: That sucks. Need me to book the same flight tomorrow?
Sloppy: No. I have an engagement tomorrow, and I need to fly tonight.
Travel Princess Magic!
Travel Princess: I just found a flight out of Dulles International Airport (IAD).
Sloppy: When do I fly?
Travel Princess: Three hours!
Sloppy Brain: Fuck. My. Life.
Sloppy: Okay. Looks like I will be...
Travel Princess: Having awkward conversations with a Cab Driver!?!
Sloppy: Exactly.
Travel Princess: I have bad news though!
Sloppy: Excellent. What is it?
Travel Princess: I can't get you a window seat. I got you an aisle seat.
Sloppy: So long as I am on the end and not subjected to two strangers.
Travel Princess: Also, you won't be going through London Heathrow. You'll be traveling through Kuwait City International (KWI).
Sloppy: (Frustrated) AWESOME!
That's how it started. Thankfully, my cab driver was more introverted than I and there was zero conversation during the commute to Washington D.C. Much to my surprise, the new-start of my international travels went swimmingly. Unlike BWI, the Transportation Security Authority (TSA) had little interest in the gadgetry in my suitcase.
Minor Rant
Dear Reader, have you ever been told a "Fact" that you did not know, or believe to be true? I am typically that guy for other people, but Troy was that guy for me. He was a former Troop Sergeants Major, and full of absolutely useless knowledge.
Troy: Did you know you cannot hum while holding your nose?
Sloppy: Bullshit!
Pause
Sloppy: Fuck!

Troy: Did you know bleach expires?
Sloppy: Bleach does not expire.
Troy: Yeah, actually, it does.
Sloppy: You're a fucking idiot. Bleach does not expire.
Troy: Bet you lunch it does?
Sloppy: Deal
Detailed Internet Calculations (DIC)
Sloppy: Fuck. What do you want for lunch?
Dear Reader, there are also the moments in which someone tells you a "Fact," but there is no way to scientifically prove that it is, in deed, factual. My "Army work"was uniquely different than the typical "Army work." There are times in which I travel with equipment that peaks the interest of a TSA Agent. I have no issues providing a mundane overview, but I don't have the time, or the authorization to provide detailed insight. Thus, Airport Security can quickly become a lethargic process.
Troy: Did you know TSA Agents try to avoid inspecting luggage with sex toys?
Sloppy: What?
Troy: Like if you have a giant dildo in your bag. They won't check it.
Sloppy: How in the hell do you know that?
Troy: My buddy. He is a TSA Agent and said he never checks bags with sex toys.
Sloppy: That does not mean this is indicative of all TSA Agents.
Troy: No. Probably not. I know they never check my bag though.
Sloppy: Crazy Eye Glare!?!
Troy: Yup. I travel with a dildo.
Dear Reader, I am certain TSA would check your bag with your dildo was nestled tightly to an object that screamed, "I'm a blast at parties." Simply writing, Troy's advice is by no means backed by substantiated fact, but TSA has never asked me to explain my unique gadgets, or the dildo in my carry-on baggage.
Rant Complete
I am not enthusiastic about aisle seats. I don't particularly care for strangers. I found my seat near the end of the aircraft, and the four seats to my left were empty. They also remained empty when the Captain announced they would be closing the doors, and we would be departing in thirty-minutes. I thought I had just won the lottery. Then I seen a mother, Crib-Midget, and Mini-Human approaching. There were four seats, and only three humans, but I felt that someone had just kicked my puppy.
Dear Reader, I have Obsessive Compulsive Disorder (OCD). Everything has it's place, and I match everything when I dress. I iron and hand my clothes the day before I wear them. I take great pride in my appearance. My OCD-alarm was pinging when I seen them approach. The Mini-Human was likely around ten years old, and carrying the largest drink Starbucks ever made. They forcefully made their way to their seats, and the Mini-Human plopped down next to me. He set his frou-frou drink down on the flimsy tray-table, and then started jostling around.
I take Tylenol PM as soon as I sit down on an international flight. Sleeping is my way of time traveling. I found myself in a dilemma. My body was telling me to close my eyes and visit the sandman, but my brain was forecasting a catastrophe.
Mini-Human Jostling Around
Sloppy, with the reflexes of a cat and speed of a mongoose, catches the drink as it's about to tip.
Mini-Human: Sorry. Thank you.
Sloppy: No problem.
Second Time
My reflexes are starting to fade, but the cup nearly tips off again as he plays video games on a handheld device.
Mini-Human: Sorry.
Sloppy: No problem. Please just watch it though.
TIME TRAVEL (Thirty-Minutes)
I wake to a very cold sensation on my brand new pants. There was chilled coffee, delicious caramel, and whipped cream all over my crotch area. My facial expressions clearly frightened the Mini-Human, but I knew it was an accident. I told him it was okay. However, I was forced to wait until we got to "cruising altitude" before I made my trip to the bathroom. I was forced to sit and just let the frothy goodness embed it's deliciousness into my outfit.
Cruising Altitude and Failed Un-dirty Clothes (FUC) Sloppy returns to slumber.
I don't recall exactly how long I was sleeping, but I was out-to-the-world. I awoke to a stewardess frantically shaking me, and telling me that I need to address an immediate issue.
Stewardess: Sir. Sir. SIR!
Sloppy: (Groggy) Yeah!
Stewardess: Here. You're baby is crying.
Sloppy Brain: Fuck. My kid is crying.
Sloppy: (Groggy) I'm so sorry.
Sloppy is now holding the last thing anyone should trust him with; another human life.
Sloppy Brain: Wait! Wait! Wait! You don't have a kid. Well, you do, but you don't have a baby, or kid on this flight.
Sloppy: Ma'am. Ma'am. Ma'am!
Stewardess turns!
Sloppy: This is not my baby. I don't have a baby.
Sloppy motions "HERE! TAKE KID NOW" gesture.
Stewardess: I am sorry, but I can't.
Sloppy: What?
Stewardess: I can't take the baby. Where are the parents?
Sloppy looks at empty aisle seats.
Sloppy Brain: Great! Fucking great. You're dream of an "empty aisle" came true, but know you don't know where the mother of this screaming child is.
Dear Reader, I have a baby cradled in my arm like a football, and I don't know where the endzone is, and spiking a football-sized human is not generally a socially acceptable practice. I need to "Heisman" this kid, but had no earthly idea where the mother was, aside from being on the airplane of course. The plane was a great place to start though.
Contrary to what many people would assume, I love the Middle East (ME), and predominately Muslim countries. I love the food, and I love the people. I have a disdain for Muslims whom initiate the lead jellybean exchange with me, but I would have that problem with Christians and Atheists as well. I generally dislike anyone who wishes to expedite my shelf-life by way of supersonic paper-cuts. There are cultural customs that make finding an absentee parent difficult during an international flight, specifically burkas.
The mother was a "ninja," and wore a head-to-toe black burka. I literally didn't know what she looked like. Further complicating my location effort was the fact that she was not alone. There were at least another hundred ladies that shopped at the same Dooey & Burka store.
Stewardess: What was she wearing?
Sloppy: That!
Looks!
Stewardess: (Puzzled) Is that her!?!
Sloppy (Fuck. My. Life Face) NO! She is wearing a black burka. Aside from that, I don't know what she looks like.
Stewardess: My god! This is gonna be challenging.
The stewardess was firm on her stance of not taking the Crib-Midget, but she thankfully assisted during Operation Find Unattended Kid Mother En-route (FUK ME). We, but mostly me, woke up at least thirty people before finding the mother's ass planted in Business Class. I can only imagine what the other ninja ladies thought when I asked them...
Sloppy: Ma'am. Ma'am. Excuse me? Is this your child (Extends human outwards)?
There were a considerable amount of "NO" answers. Worse? Some of the people did not speak English. I wonder what was going through their minds.
Dramatization
Sloppy: English. English English English?
Translation
"Would you like my child?"
"I found this "thing" next to me. Is it yours?"
"Free Baby! Piping hot Free Baby here. Get your Free Baby."
The stewardess had a long conversation with absentee-mother, and she returned to Coach with the rest of the animals. I couldn't see past the eyes, but she looked angry with me. Not only did I rat her out for her stealthy move to Business Class, but I passed off a crying human.
Dear Reader, the rest of the flight was uneventful. The landing and hustle at Kuwait City International was anything but. I was familiar with the layout of the airport, but I was low on time. I had decided to take another attempt at washing my pants. I entered the nearest bathroom and found a line of men, and they were all washing their feet in the sink.
I get it. I understand why they were doing it, but there is no "wait in line" in the Middle East. You, like an asshole, push your way to the front and skip everyone else in line. It's "a way" in the United States, but is not "the way" most Americans practice "wait in line." I got sick of standing in line after about ten men budged. It was my turn.
Sloppy: Excuse me. I was in front of you, and I am going to...
He looks me up-and-down, and then it happened.
Male: At least I didn't piss my pants.
It was perfect English, but I didn't have the time to explain that I didn't piss myself. I just rolled with it. The second cleaning attempt was just as fruitless as the first cleaning attempt. The only thing that made my trip better was chaos in Beirut International (BEY). I arrived, and managed to beat the rush through customs. I was then greeted by a nearly seven foot tall giant named Jimmy.
Jimmy: Whoa! Did you piss your pants?
Sloppy: Not yet. Long story. I have to piss before we roll.
I was more than familiar with the layout of this particular airport, but I was paralyzed with piss-pain. I could barely walk, let alone run, to the bathroom.
Jimmy: Ahh. I will go hold up the line.
It was an odd statement. I was not certain how Jimmy would, "hold up the line," but I would soon find out. The bathroom at Beirut International is immediately to the right after you depart customs. However, it's the size of a small closet. There are two urinals, and one toilet stall. The spacing between the urinal and opposite wall is no more than four feet though. Again, think long, but narrow closet.
I continue the agonizing pee walk and I am a bit disappointed when I see a large line forming near the bathroom. There was "loud chatter" that I didn't understand, and some clearly disgruntled humans. I rounded the corner and nearly pissed myself. Jimmy was in deed "holding up the line." Jimmy's back was firmly planted on the wall to the right, and a flowing stream of yellow piss was arcing across the room, and landing in the urinal to the left. Jimmy was peeing from wall-to-wall. Nobody was going past urinal number one without receiving a golden shower.
Jimmy: (Smile) I got you man. Come in. I'll pinch her off.
Sloppy, like Moses (Kind of) parts pee stream and proceeds to second urinal.
I take a look to the left to get a glimpse of the chaotic line at the entrance. There were loud grumbles of displeasure, but, then I seen an old man. The old man was at least 70 years or older, and his face went from scowl, an onto smile. He then started to clap and I congratulate Jimmy's technique.
Old Man: (Laughing with Arabic Accent) Bravo. Bravo.
Sloppy: That was fucking brilliant.
Jimmy: Yeah. Didn't think you wanted to wait in line. Pulling out a gun would have been too much, so I figure peeing across the room would work.
Sloppy: Good to know for the next time.
That's that Dear Reader. Not an ordinary Military tale, but it was the oddest Military travel tale I have had. I "pissed my pants" with coffee, which ruined them. I was handed a baby that was not mine, and then forced to conduct a Ninja-hunt. I was accused of pissing my pants by men who were washing their feet in sinks. I was then accused of pissing my pants by Jimmy, and then Jimmy saved the day with four feet of arc pissing that was superbly executed. I'd like to thank the Army for this tale, because I don't know if Joe Civilian has experiences like this. Fucking Army!

Cheers,
Sloppy

Should You buy Apple stock or has the company run out of growth opportunities? What is my price prediction for Apple in the next years? Read until the end as I reveal my price target for Apple and also what I think will happen in the next couple of days, weeks & months!
~ Warning! Very Very Long Post~
Hello everyone! So, let’s go over some of the latest news on Apple before moving on to some fundamental and technical analysis, predictions and my price target for the stock in the next years.
So, let’s start with the news that Apple will cut the App Store commission in half for small app developers starting in the next days, this will impact developers who earn less than $1M annually from the App Store Sales. This is likely to lead to a small decline in commission revenues for Apple as around 98% of the app developers will qualify for this tax reduction from 30% to 15%, but all these small developers only contribute to about 5% of the estimated $50B in annual revenues from the App Store, so that would be only a $1.25B loss for the company, that is less than half a % of the company’s total net sales in the last fiscal year.
Also, these changes may lead to a potential long-term revenue boost, as it is likely this will lead to an increasing creation of apps which will generate more commissions in return.
Alongside this we also saw the company releasing the new MacBook’s with their first in-house chip, which promises faster video and imaging processing times, with both CPU and GPU performance up to 2 times faster than the latest PC laptop chip using just a fraction of the power consumption, with both of the macbooks promising big improvements in battery life. Apple is also expected to roll out even more in-house chips in future products, as they have started the 2-year breakup with Intel chips.
We also saw Morgan Stanley upgrading their base case to $191 at the end of November, as they have cited record lead times, supply chain forecasts and carriers demand as they expect that the company will sell around 270M iPhone in fiscal year 2021, that’s 50M more than the consensus and almost 30M more than the previous estimate of Morgan Stanley, with an average selling price of 842$, 9% more than the base case, as people tend to chose the more expensive and high tech versions of the lineup in this new 5G cycle.
The 5G super-cycle, which I believe is on the way, and will continue in the next years, as 5G become more available worldwide, could still be the biggest thing coming right away for the company with 5G smartphones expected to surpass 4G sales by 2024, with the average sale price of the 5G phones also coming down, helping them become more popular.
They also released an update iPad Pro and an all-new iPad Air in September which will also boost sales in this work-from-home environment that will keep the demand very high for this kind of products, just like the Macs. Alongside the increasing demand from the Wearables, Home & Accessories that include Air Pods, Apple TV, Apple Watch, and many more products.
But the biggest reasons I believe Apple is poised for continued growth, is primarily due to its services business, as they start to have more and more services like the Apple ONE BUNDLE, which include up to 6 services from (Apple Music, Apple TV+, Apple Arcade, Apple News+, the new Apple Fitness+ and the iCloud service) for a pretty reasonable price in my opinion starting from 15$ up to 30$/month, this could be a great option for families and even individuals who use their services a lot.
The latest services, Fitness+ just launched in the past days, and is a direct competitor to the likes of Peloton, as the service is available on the iPhone, iPad or even Apple TV. This also makes consumers buy the Apple Watch which syncs to the other devices to show you all kinds of information. The Fitness+ app just on its own is 8$/month or 80$/year which is less expensive than Peloton subscription which charges 13$ or even traditional gyms like Planet Fitness at 10$/month.
I think this will be the fastest growing sector for the company, as this aligns with the new macro trends, as the world is moving more and more to a digital approach to almost everything as consumer preferences, with more & more younger people reaching the point in life when they use these services start to align to this increasing digital approach.
We also shouldn’t forget the Apple Card & Apple Pay service among many others which also seem to gain from the move to digital & contactless payments, as this has been accelerated due to the current situation in the past year.
And one last piece of news, and the most recent one, is that Apple may have fast-tracked the Titan project. The Titan project is targeting a 2024 or 2025 push to develop an electric vehicle with advanced battery technologies, that will deliver significant increases in range at much lower costs than the current technologies while also having self-driving capabilities.
It’s reported they will not use the same technology as Tesla Full-Self-Driving feature, but will use LIDAR sensors, similar to those that we can find in the latest iPhone 12 PRO.
I think Apple can go 2 ways with this project, they can either use the huge amount of cash the company has to buy another car-maker like Ford, GM or any other car manufacturer expect Tesla and Toyota which do have a big market cap, so that they can fast-track the potential manufacturing of cars, or they can enter into a partnership with big companies like Tesla, Volkswagen or any other car marker to either produce cars or license their technology to this other car-makers which would ultimately and probably have higher margin-returns than the actual manufacturing of cars. Apple’s current overall gross margins stand at 38% vs the 15% average of the world top 10 automakers by market cap, which is significantly lower.
But this Apple Car thing is so long out, and there are so many unknowns, I will not try to predict anything related to this until there is more clarity on the subject.
And last, before moving on to some predictions, here are some of the highlights that we heard from the latest investors conference meeting, as the CEO, Tim Cook expressed optimism ahead with the launch of many new products and services, especially the Home Pod Mini and the new 5G iPhones, as these new iPhones include new LIDAR scanners that greatly improve the camera capabilities, as the iPhone as seen very positive reviews. We also saw the Senior VP and CFO, Luca Maestri give us great outlook for the company as they expect the installed devices base to continue to growth despite already being at an all-time high as they have over 585M paid subscriptions on their platforms and expect this to surpass 600M by the end of 2020.
I also researched and found what products we can see in the near future, with the first half of 2021 bringing new iMacs, the AirPods3 and the iPad Pro, while in the FALL event we will probably get the new iPhone 13 alongside the iPhone SE PLUS and the Watch Series 7 with more products coming later in 2021 or that don’t have an estimated release date like the Air Pods Pro, the Air Tags and the iPad Mini 6.
So, before even starting, you should know that I am bull on Apple but I am willing to hear other opinions so don’t be afraid to leave a comment down below.
I have made some predictions based on the growth rate of the company, the latest plans announced by them and used some estimates. So, keep in mind this are only projections and are calculated by myself, this is not an investment advice and you should do your own research.
This are my 2025 projections for Apple, let’s take a closer look at them, each on their own.
So, in term of revenues, Apple has 5 big sources of revenue, which saw an overall increase of 6% despite lagging sales in the iPhone. The biggest revenue is by a big margin the iPhone right now with over $137B in revenue in the fiscal year ending in September. I expect to see the iPhone sales increasing in the next years, especially in 2021, with the new 5G iPhone creating a super-cycle for the company, as most iPhone users, including myself here, as I will upgrade from my iPhone X, will switch to this new product. The iPhone sales have decreased in the last couple of years by 14% and 3% as a result of the product not having big improvements, as well as iPhone usually starting to last longer than previous models, so I expect to see a 12% increase in sales next year and a gradual decrease in the growth of sales as more people upgrade, ending with just a 5% growth in iPhone sales in 2025.
The next revenues stream is from the Mac, which has seen an increase in the past 2years, with revenues topping $28B this year after the huge demand from the work from home consumers. I expect this trend to continue as they plan to continue to launch better products and I can see the company having a similar growth next year before starting to decline slightly until 2025, also ending with a 5% growth.
The iPad is currently the smallest revenue stream for Apple but has also seen an increase in demand in the past 2 years with a 13% average increase in revenues. I also expect the iPad to continue to grow in the next couple of years, especially with the learn-from-home environment for kids, and even after this period ends, the transformation for learning will implicate more digital usage. I expect the iPad to see some similar growth to the Macs, especially with the latest generation also bringing a new iPad air to the market.
The 4th revenue stream and the fastest growing in the past 2 years, with an average growth of 33% are the wearables, home & accessories revenues. This have topped $30B this year, as Apple has also just launched the Apple Watch series 6 and also feature other great products like Apple TV, the Air Pods the Home Pod and the Home Pod mini alongside other third-party accessories.
I gave this revenue stream a growth of 20% starting next year with a gradual decrease to around 8% by 2025, as I believe this will become more & more popular as they start to have more vertical integration.
And last, but by no means least, the revenue stream that I expect to grow the most and the fastest is the revenue from the services that Apple gets. This includes revenues from Apple Care, Advertising, Cloud Services, Payment Services like Apple Card & Apple Pay and of course the digital content which includes fees from the App Store alongside subscription-based revenue including the new Apple One Bundle and Apple Fitness+ alongside the already know Apple Arcade, Apple Music, Apple News+, Apple TV+ and hopefully I don’t forget any others.
So, I expect this to become the clear 2nd biggest revenue stream for Apple by 2025, as I expect this to grow more than 20% next year, mainly due to the Apple One Bundle and Apple Fitness+ followed up by a slightly decreasing growth, ending with a 10% increase in revenues in 2025.
I think this are fairly conservative base case scenarios for the revenues, as I expect them to continue to increase the other revenue streams and not have such a large percentage of the revenues coming from the iPhone sales as you can see in this chart.
In terms of expenses, I pretty much kept the same margins as in previous years, with a 68% expense ratio on product sales [ iPhone / iPad / Mac / WHA ] and 35% expense ratio on SERVICES, as this are way more lucrative.
In the past 3 years, the products gross margin was 32.7%, so I actually imply bigger expenses for the manufacturing and sales of products, as this is mostly impacted by the company’s supplier’s ability to make up for and demand, while for the services revenue, the gross margins for the last 3 years has been 63.5% on average, but I expect this to be more in-line with the 66% margin in this past year. So, if services manage to grow to about half the revenues from the iPhone, this will double the gross revenues, as every buck gained in the service revenues account for 2$ in the product sales.
So, I expect the total revenues for Apple to increase from $274B in 2020 to over $440B by 2025, increasing by approximately 10%/year, while I will keep the expense ratio pretty much in-line and have them increasing by 11%/year, this would bring the total gross for Apple to $177B, increasing mainly due to the services revenues as I said earlier. This growth is just above the 4year average, and below the 2018 levels, which we might see again with this 5G super-cycle and explosive growth in the services revenue.
I also think the company will continue to invest in both Capital Expenditure and Operating expenses.
I think the operating expenses will remain pretty much in line with the previous years, as this number has increased by 1% annually both in R&D and SG&A. So, I will keep the exact percentages from previous years, as I expect the revenue to increase, thus I don’t see a big increase percentage wise. This would account for over $60B in operating expenses by 2025 and over $11B in Capital Expenditures by 2025, as I expect this to increase, mainly due to the possible EV developments or investments in self-driving capabilities alongside other manufacturing capabilities. You can see that the Capex spending has been decreasing in the past years with just over $8.8B in payments for business acquisitions and the other traditional Capex spending. Some people may use the cash generated by investing activities as Capex, but that is more unreliable. I also can see the Capex going back up, so I wanted to be safe and implied a 10% growth.
This money would account for over $73B in expenses and would bring the profit for the company to almost $104B before I&T.
Moving on, let’s see what revenue and expenses the company has had in the past few years. We can see a decrease in I expense in the past few years as the company has been paying debt, but they have also been generating less money in this department, with an overall decrease in this department of more than 50% in the past year, way less than the amount from 2018. So, for safety reasons, I used a 10% decline in both revenues and expenses related to I, while increasing the other losses by 10%/year.
This would bring the company pre-tax $$$ to just over $104B in 2025.
Let’s move on to taxes. I know the Federal tax rate is 21% for the company, but the actual tax rate for the company was lower than 15% in the past year, mainly due to lower tax-rates on foreign earnings alongside tax-benefits and tax-settlements. The average tax rate has been just over 16% in the past 3 years, but with more and more of the revenues coming from outside the US, I think it’s safe to say that the company will have around a 15% tax rate by 2025, this obviously if nothing major changes in tax policy around the world.
So, Apple would have $88.6B in $$ after tax by 2025 and with the current outstanding shares standing at just under 17B, so I don’t even account for the company probably continuing to do share buybacks, this would mean a $5.22 future earnings/share. And with today’s price for Apple just around 136$, that would mean to company is trading at just over 26 times forward price to earnings.
I don’t think Apple will ever trade at a discount again, with the current PE standing at over 40, I believe this will eventually go down, probably to around 35, despite the increase in services revenue, which is highly valued by investors. I think we can see Apple trade somewhere near 35 times P/E in 2025, especially if something big happens with the EV project, this could be even higher, just look at Tesla which trades at insane P/E. Of course, we also have to take into consideration the dividends that will be received from owning the stock, as Apple has started to pay dividends almost a decade ago and has 9 years of dividend growth, with a 10% annual rate of growth in the past 5 years. Here is the dividend growth history for the company, as I also went conservative on this estimate and implied a 7% growth for the next 2 years, 6% for 2023 and 2024 and just 5% in 2025.
So here are my 3 price targets for the company, including dividends but not reinvested. My bear case scenario is that Apple will trade at almost 165$ which implies a return of over 21% by 2025, while my base case scenario would see Apple trading at 195$ with a return of capital of 43%. I will also make the bull case for Apple trading at 225$ by 2025 with dividends included, which would imply just over 65% in gains by then.
I think this is possible as Apple has also continued to buy back shares of the company on a constant basis, as they continue to an impressive campaign with over $72B worth of common stock repurchased in 2020. They continue to buy back shares at a very fast pace, having repurchased over 1.3B shares in 2019 and 2018, while also issuing less stock every year.
So here is the full spreadsheet that I have projected for Apple by 2025 and the breakdown of everything i estimated [ 1 / 2 ] , if you do have another opinion or a suggestion please leave a comment down below, I think I have been conservative in most of my projections, but feel free to give your opinion.
Keep in mind, these targets might sound ridiculous, but just look at the growth Apple has had in the last 5years. The company has increased in value by more 400% in just the past 5years and is over 100.000% up since it started trading. So yes, the valuation is mad right now for the company. So, are you willing to bet against Apple?
The company also has pristine financials, with more than $65B in total assets compared to total liabilities, and more than $38B in cash and cash equivalents.
So, what do I expect in the next couple of days, weeks and months for Apple?
Let’s look at this CHART, so starting with the stock split, Apple saw a correction within the September stock market pullback, in a buy the news & sell the event, after a huge runup post-announcement of the stock split. The stock entered a consolidation period, and didn’t have any big catalysts, especially with new iPhone lineup not being included in the Q4 results due to the late launch. The stock found some levels of resistance near the $120 levels that it struggled to get past but acted also as support after breaking them just before the recent news of the possible EV developments or self-driving-features to be licensed to other car manufacturers. After that news the stock spiked and has now reached the previous highs made before the stock split and is facing some resistance, if the stock pushes over $140 I think we can say that it broke the resistance at those levels and is not just a fake-out. But I think it’s likely that the stock will consolidate between 122 and 135$ in the next weeks until the next iPhone sales and quarterly results are released, as the stock has entered overbought territory again with an RSI over 70, the first time since the stock split.
So, what would I do? Well, I own Apple stock, and I would really add on any weakness that the stock shows before the next quarter earnings are released, as typically Q1 earnings are the best for the company due to increased holiday sales combined with the launch of new products. I think any entry below 130$ would be really nice to start and build a position or increase it if you already own the stock.
Thank you everyone for reading! Hope you enjoyed the content! Be sure to leave a comment down below with your opinion on the stock market!
Have a great day and see you next time!

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