Over the past two months, I’ve been both bullish and bearish on Apple (NASDAQ:AAPL) stock, calling the stock a strong buy after the tech giant announced a stock split in late July, and then saying it had come too far, too fast in early September.

Now, with AAPL stock having collapsed more than 20% in September alone, I think it’s time to get bullish again.

That is, the only reason I didn’t like Apple stock back in early September was the valuation. The stock was simply overvalued. Now, that problem is gone. Following a 20% correction, shares are fairly valued again.

Meanwhile, the fundamentals — strong new product announcements, the 5G iPhone launch later this year, huge uptake of the company’s new software services, etc — remain very solid, and the macroeconomic backdrop continues to improve.

So don’t overcomplicate this one.

Buy the dip in this long-term winner.

Here’s a deeper look.

Apple is Still Firing on All Cylinders

Apple was firing on all cylinders back in late August, and is still firing on all cylinders today.

The company just launched a series of new products and services which should help boost sales in 2021/22.

The new Apple One bundle is a perfect way for the company to create an economic, all-in-one subscription service that should see strong uptake over the next few quarters. Apple TV+ is a big winner of that bundle, because it will entice current Apple Music users to buy the bundle which includes Apple Music and Apple TV+, leading to a surge in TV+ viewers. That creates a positive growth flywheel, because the more people watch Apple TV+ shows, the more people talk about them, and the more other people want to watch them (which should, of course, lead to more sign-ups).

Apple Fitness+ is a great new service built for a world where there’s a ton of demand of high-quality, at-home workout videos and platforms. Early adoption of this platform should be very strong in late 2020 and early 2021.

Meanwhile, a new, low-price Apple Watch SE will bring many first-time smartwatch buyers into the market — you know, people who have always been interested in smartwatches but didn’t want to spend $400 on one. New iPads should also see robust adoption in the education world as that world digitizes and adjusts to a “new normal” thanks to Covid-19.

At the same time, Apple’s highly anticipated 5G iPhone is still launching later this year. Ahead of that launch, iPhone 11 demand is “moderating substantially”, according to JP Morgan, which is a good sign because it means everyone is waiting for this new phone to drop —  a dynamic which implies that Apple could sell a ton of new iPhone 12s as full price and high margins.

Overall, the fundamentals supporting AAPL stock are really, really good.

The Economy is Still Improving

One thing that could derail Apple’s strong fundamentals would be a collapse in the global economy.

But all signs point to the reality that the economy is still recovering and will continue to recover.

People are going out more. Traffic is coming back. Malls, shops and restaurants are busier. Movie theaters are open. So are theme parks. Sports are back. Students are going back to school. Employees are returning to the office.

These things are happening. Everywhere. According to smartphone tracking data from SafeGraph, consumer mobility across the U.S. — which plunged as much as 20% below normal in April — is now just 2-3% below normal levels.

Because of this consumer behavior normalization, consumer spending is rebounding.

Apple is built on the back of consumer spending. So long as consumers are buying phones, watches, tablets and software services, the economic backdrop will remain supportive of AAPL stock.

Apple Stock is Appropriately Valued Again

As I said, the one thing that was wholly unattractive about AAPL stock back in early September was the valuation.

But that problem has now fixed itself through a rapid 20% plunge in the stock price. On the heels of that sell-off, AAPL stock once again looks fairly valued.

My numbers suggest that Apple could do about $5.50 in earnings per share by 2025. That’s well ahead of consensus sell-side estimates, which sit below $5. A 25 times forward earnings multiple on that implies a 2024 price target for AAPL stock of $137.50.

Discounted back by 8.5% per year, that implies a 2020 price target for AAPL stock of ~$100.

Sure, that’s below where shares trade today. But not by much. And in this market with zero rates, growth stocks will be perpetually overvalued.

To that extent, it’s fair to say that AAPL stock is in fair value territory today, considering the macroeconomic backdrop.

Bottom Line on AAPL Stock

It’s time to get bullish on Apple stock… again.

The fundamentals are great. The consumer spending backdrop is favorable. And the stock — which was overvalued — has come back to tangible valuation levels.

All in all, that means AAPL stock will likely consolidate around current levels, before marching higher in late 2020 and early 2021 on strong 5G iPhone demand.