{"id":524658,"date":"2022-10-12T04:16:21","date_gmt":"2022-10-12T08:16:21","guid":{"rendered":"https:\/\/financhill.com\/blog\/?p=524658"},"modified":"2022-09-25T09:24:53","modified_gmt":"2022-09-25T13:24:53","slug":"if-i-could-only-buy-1-stock-what-would-it-be","status":"publish","type":"post","link":"https:\/\/financhill.com\/blog\/investing\/if-i-could-only-buy-1-stock-what-would-it-be","title":{"rendered":"If I Could Only Buy 1 Stock What Would It Be?"},"content":{"rendered":"<p><span style=\"font-size: 1em; text-align: justify;\"><em>If I Could Only Buy 1 Stock What Would It Be?<\/em> Putting constraints on your stock trading strategy can sometimes help clarify what\u2019s truly important in long-term investing success, as imagining various theoretical scenarios can be an excellent aid in gaining a more sophisticated understanding of how share prices rise and fall.<\/span><\/p>\n<div>\n<div style=\"text-align: justify;\">Indeed, one hypothetical scenario could be this: If you were only able to buy one stock for the rest of your life, what kind of stock would it be?<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">To begin with, you would definitely want to <a href=\"https:\/\/financhill.com\/blog\/investing\/reasons-to-buy-apple-stock-now\">invest in a profitable company<\/a>, one that&#8217;s guaranteed to go on <a href=\"https:\/\/financhill.com\/blog\/investing\/how-much-will-apple-stock-be-in-10-years\">performing well into the future<\/a>. You might also look for a business with a good dividend too, as that could provide some extra income security as time goes by.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">Furthermore, you\u2019d probably prefer to buy a stock you\u2019re familiar with, as well as one that has a great management team and a compelling market advantage.<\/div>\n<\/div>\n<p>Fortunately, there&#8217;s one such company that matches all those criteria &#8211; and that company is <a href=\"https:\/\/financhill.com\/blog\/investing\/tim-cook-leadership-style\">Tim Cook\u2019s Apple<\/a>.<\/p>\n<p><iframe loading=\"lazy\" style=\"margin: 0 auto; border: 0;\" src=\"https:\/\/financhill.com\/widget\/charts\/AAPL?defaultOverlays=EMA20%2CSMA50&amp;defaultIndicators=ADL&amp;periodGrouping=daily&amp;defaultSeries=candlesticks\" width=\"720\" height=\"500\" frameborder=\"0\" scrolling=\"no\" seamless=\"\"><\/iframe><\/p>\n<div>\n<div style=\"text-align: justify;\">In fact, the corporation is a superb pick for long-term investors right now; its products are incredibly popular, and the brand is one of the most recognizable in the world. Moreover, Apple boasts an impressive <a href=\"https:\/\/www.apple.com\/newsroom\/pdfs\/FY22_Q3_Consolidated_Financial_Statements.pdf\" target=\"_blank\" rel=\"noopener noreferrer\">gross profit margin of 43%<\/a>, meaning the company should keep on generating cash for many years to come.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">But if you\u2019re still not convinced about the proposition just yet, maybe an endorsement by the Oracle of Omaha will do the trick. Apple represents Warren Buffett&#8217;s single largest position, accounting for a full <a href=\"https:\/\/financhill.com\/smart-money\/billionaire-portfolios\/warren-buffett\">40.8% of Berkshire Hathaway&#8217;s entire portfolio<\/a>.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">So let\u2019s take a closer look, and see why Apple would make a prized addition to your own investment fund.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/images.unsplash.com\/photo-1615725802642-936d9aade2ba?ixlib=rb-1.2.1&amp;ixid=MnwxMjA3fDB8MHxwaG90by1wYWdlfHx8fGVufDB8fHx8&amp;auto=format&amp;fit=crop&amp;w=1332&amp;q=80\" alt=\"\" width=\"855\" height=\"481\"><\/div>\n<div><em>Source: Unsplash<\/em><\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<h2 style=\"text-align: justify;\">Apple Is Still The King Of Tech<\/h2>\n<div style=\"text-align: justify;\">As one of the foremost manufacturers of productivity hardware in the world, Apple has been at the coalface of personal computer development since the 1970s and continues to lead the way in innovation with its line of MacBooks, iMacs, and iPads.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">In fact, Apple\u2019s commitment to design and user experience is what sets its products apart. It has made the company a favorite among creative professionals and general consumers alike, and, with new products such as the Apple Watch and HomePod, it&#8217;s clear that the business is still at the forefront of today&#8217;s technology and design revolution.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">In addition to its hardware devices, Apple&#8217;s Services business is also a major player in the sector, with some of the highest usage statistics of any company.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">For instance, with over <a href=\"https:\/\/www.businessofapps.com\/data\/app-stores\/\" target=\"_blank\" rel=\"noopener noreferrer\">3.59 million apps available for download<\/a>, the Apple App Store is the second-largest digital application marketplace in the world. The firm\u2019s Apple Music platform is also beginning to challenge the music streaming space again, with only <a href=\"https:\/\/www.businessofapps.com\/data\/music-streaming-market\/\" target=\"_blank\" rel=\"noopener noreferrer\">Spotify beating it in terms of subscribers<\/a> in 2021.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">Apple iCloud is also hugely popular with customers too. The service allows users to automatically back up their iOS devices, making it easy to keep all of their important data safe and secure. Furthermore, iCloud provides a way to access data from anywhere, on any device, and is extremely valuable for busy people who need to work remotely and on the go.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">What\u2019s most crucial, however, is the fact that Apple Services is also contributing to the company\u2019s top-line growth as well. The firm \u201c<a href=\"https:\/\/www.apple.com\/newsroom\/2022\/07\/apple-reports-third-quarter-results\/\" target=\"_blank\" rel=\"noopener noreferrer\">set a June quarter revenue record<\/a>\u201d of $83.0 billion in 2022, driven in large part by the strong showing of its subscription products wing.<\/div>\n<\/div>\n<p><iframe loading=\"lazy\" style=\"margin: 0 auto; border: 0;\" src=\"https:\/\/financhill.com\/widget\/fundamentals\/AAPL?defaultTimespan=quarter&amp;defaultType=revenue\" width=\"720\" height=\"400\" frameborder=\"0\" scrolling=\"no\" seamless=\"\"><\/iframe><\/p>\n<div>\n<h2 style=\"text-align: justify;\">Apple Is A Cash Flow Monster<\/h2>\n<div style=\"text-align: justify;\">While many investors tend to focus on revenue when assessing the financial state of a company, it\u2019s often cash flow that\u2019s the real lifeblood of any business. That\u2019s because cash flow is a measure of the actual money coming in and out of a venture, while revenue only measures sales.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">In fact, it\u2019s also one of the few metrics that can give an insight into a company\u2019s operational health. For example, if a company has a strong cash flow but weak profitability, that may be indicative of inefficient operations. Conversely, if a company has strong profitability but a weak cash flow, that may be a sign of poor managerial decision-making.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">In Apple\u2019s case, however, it\u2019s even more important to consider cash flow because, as a cutting-edge technology enterprise, the company has to continuously reinvest in Research and Development (R&amp;D) in order to maintain its competitive advantage.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">For instance, Apple plowed back <a href=\"https:\/\/s2.q4cdn.com\/470004039\/files\/doc_financials\/2021\/q4\/_10-K-2021-(As-Filed).pdf\" target=\"_blank\" rel=\"noopener noreferrer\">$21.9 billion into its R&amp;D efforts<\/a> in 2021, an increase of 17% &#8211; or $3.16 billion &#8211; on what it invested in 2020.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">It\u2019s a good job then that Apple\u2019s cash position is so robust. At the end of the most recent third quarter, Apple had a cash flow from operating activities for the last nine months of $98.0 billion, implying an annual run rate of around $131 billion.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">On top of that, Apple also had a trailing twelve-month (TTM) return on total assets of 29.6% &#8211; a figure that suggests the firm\u2019s management is using the company\u2019s resources in a particularly efficient manner. This is a stark and welcoming contrast with the broader IT sector return of just 2.62%.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<h2 style=\"text-align: justify;\">The Future\u2019s Looking Good<\/h2>\n<div style=\"text-align: justify;\">Apple\u2019s device offerings are certain to continue to be the best-in-class, and there&#8217;s no reason to believe its proven track record of innovation will fail anytime soon. The company\u2019s Services division can expect to remain highly profitable, as it builds on the strong foundation of products and platforms such as the App Store, iCloud and Apple TV.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">That said, there are still a few potential areas of growth that Apple could exploit, including the increasingly important augmented reality market. The company has already made headway in this department, providing a selection of tools and resources for AR developers to utilize, such as its ARKit and RealityKit applications.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">Apple also offers investors a rather enticing dividend payment that performs well on several different fronts.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">For instance, the distribution is well-covered with a TTM payout ratio of only 14.7%, and Apple\u2019s been paying the dividend consistently since 2012. Yes, the yield is low at 0.61%, but this is compensated by the dividend having grown at a 10-year compound annual growth rate of 25.3%.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">What\u2019s more, Apple has increased its payout every year for the last decade, which, if that continues, will generate a high return for shareholders over the long haul.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<h2 style=\"text-align: justify;\">Conclusion<\/h2>\n<div style=\"text-align: justify;\">Apple has long been a favorite of many retail and institutional investors. The company consistently produces high-quality products that are both stylish and functional, and its customer service is legendary.<\/div>\n<div style=\"text-align: justify;\">&nbsp;<\/div>\n<div style=\"text-align: justify;\">And if you could only ever buy one more stock from here on out, then Apple is surely the one.<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>If I Could Only Buy 1 Stock What Would It Be? Putting constraints on your stock trading strategy can sometimes help clarify what\u2019s truly important in long-term investing success, as imagining various theoretical scenarios can be an excellent aid in gaining a more sophisticated understanding of how share prices rise and fall. Indeed, one hypothetical [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":524659,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"content-type":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[22],"tags":[332,312,349,339,372,330,489,456,487],"class_list":["post-524658","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing","tag-adv","tag-aapl","tag-dsgr","tag-orcl","tag-bpop","tag-rsss","tag-ttm","tag-tisi","tag-ttmi"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/financhill.com\/blog\/wp-content\/uploads\/2022\/09\/Untitled-design-2022-09-25T081845.228.jpg","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p9czeV-2cue","_links":{"self":[{"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/posts\/524658","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/comments?post=524658"}],"version-history":[{"count":3,"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/posts\/524658\/revisions"}],"predecessor-version":[{"id":524662,"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/posts\/524658\/revisions\/524662"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/media\/524659"}],"wp:attachment":[{"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/media?parent=524658"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/categories?post=524658"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/tags?post=524658"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}