Editor’s note: This column is part of our Best Stocks for 2015 contest. Louis Navellier’s pick for the contest is Apple (AAPL).
It’s a good time to talk about Apple (AAPL) again. If you recall, I put this tech titan on my Best of 2015 list at the beginning of the year. And while it has had a bumpy ride, it is going to finish very strong.
Part of the problem has been China’s slow growth. Many investors see China a the key the company’s fortunes for the next few years. But there are two fallacies here.
Yes, China is slowing. But that’s the broad economy — it doesn’t mean people aren’t buying consumer goods, or the middle class is falling apart.
The recent iPhone 6 sales numbers broke the initial weekend sales record, and China sales put them over the top. According to tech research group IDC’s recent report, AAPL’s China smartphone sales should grow 23% in 2015 and remain above worldwide market growth rates through 2019.
Also, according to the report, smartphone sales growth in China will diminish in coming years … but it will expand in India, Indonesia and Africa — particularly for AAPL products.
AAPL Stock Has No Shortage of Catalysts
But that’s just the beginning. AAPL has a powerful base of products that will continue to expand its revenue base, including its music service, new generation of laptops and AppleTV.
But the two biggest drivers for the future will be the Apple Watch and AAPL’s iPhone upgrade program.
The upgrade program means aspiring iPhone owners can afford to buy the phone in monthly installments and get a new upgrade every year. This should be a huge opportunity for AAPL to expand its growth and bring in new Apple faithful.
The Apple Watch is about to explode. Sales have been kept close to the vest, but they appear to be healthy, so estimate that AAPL is on track to sell 10 million watches in its first year.
And this month, the watch is launching in parts of Europe, which will certainly boost sales. What’s more, Best Buy (BBY) is going to carry the watches in its stores for the holiday season; Sprint (S) and T-Mobile (TMUS) will begin selling the watches this month as well.
Looking at the longer term, it has been reported widely that AAPL is planning on getting into the electric car business by 2019. There have been rumors for some time now, but sources have confirmed it and the company has a secure test site in Northern California and has discussed requirements for testing an autonomous vehicle with the California Department of Motor Vehicles.
Apple already has 600 workers in this division, with some pretty big names signing on to the project. While the major car manufacturers scoffed at the idea of a tech company muscling in on their game, the rumors were powerful enough to send Tesla (TSLA) stock down 2%.
The question is whether AAPL will go it alone or find another company to partner with that can work on the software and programming while it can focus on design and build.
Regardless of what happens with the car project, AAPL has plenty to look forward to in coming quarters. And since the stock is basically sitting where it was at the beginning of the year, it’s still a great buy for outsized growth in the end of 2015 and into 2016.
Louis Navellier is a renowned growth investor. He is the editor of five investing newsletters: Blue Chip Growth, Emerging Growth, Ultimate Growth, Family Trust and Platinum Growth. His most popular service, Blue Chip Growth, has a track record of beating the market 3:1 over the last 14 years. He uses a combination of quantitative and fundamental analysis to identify market-beating stocks. Mr. Navellier has made his proven formula accessible to investors via his free, online stock rating tool, PortfolioGrader.com. Louis Navellier may hold some of the aforementioned securities in one or more of his newsletters.
