Shares of tech giant Apple (NASDAQ:AAPL) surged in after-hours trading after the company reported earnings for its second quarter of Fiscal Year 2024. Earnings per share came in at $1.53, which beat analysts’ consensus estimate of $1.50 per share. Sales decreased by 4.3% year-over-year, with revenue hitting $90.8 billion. This beat analysts’ expectations by $190 million.
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The iPhone generated $45.96 billion in sales, while iPad and Services revenues contributed $5.56 billion and $23.87 billion, respectively. Additionally, the Wearable, Home, and Accessories segment recorded revenues of $7.91 billion, while Mac sales hit $7.45 billion.
Impressively, Apple announced a massive $110 billion buyback plan while raising its quarterly dividend by 4% to $0.25 per share. Furthermore, the firm tends to spend roughly $21 billion per quarter on buybacks, based on the image below. If Apple uses up the entire $110 billion in 2024, the average will be around $27.5 billion per quarter, which would be a significant jump from the past three years. It also represents more than 4% of the total market cap based on today’s closing price of $173.03 per share.
Chinese Sales Beat Expectations
There have been many worries about Apple’s performance in China lately. Indeed, stiffening competition, along with economic headwinds, have caused the firm’s sales in the country to drop by 8.1% year-over-year to $16.37 billion. Nevertheless, this beat analysts’ estimates of $15.87 billion. China is a very important market for Apple, as it makes up almost a fifth of its sales.
Is AAPL Stock a Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on AAPL stock based on 18 Buys, 11 Holds, and two Sells assigned in the past three months, as indicated by the graphic below. After a 10% year-to-date decline, the average AAPL price target of $200.37 per share implies 15.75% upside potential. However, it’s worth noting that estimates will likely change following today’s earnings report.
