Apple is trading near a fresh all-time high after a strong one-year run. The company has a large installed base that supports a high-margin Services business. Recent results show Q2 FY26 revenue of $111.18 billion, up 16.6% year over year, with EPS of $2.01 beating consensus. Services reached an all-time record of $30.98 billion, and Greater China rebounded to $20.50 billion. Incremental Services revenue from AI features and storage is projected by analysts, while markets price a high probability of an iPhone 18 launch. Valuation appears stretched with a trailing P/E of 37, forward P/E of 34, PEG of 3, price-to-book of 42, and free cash flow yield of 2.20%.
"Q2 FY26 revenue reached $111.18 billion, up 16.6% year over year, with double-digit growth across every geographic segment. EPS of $2.01 beat the $1.94 consensus. Greater China rebounded to $20.50 billion after multiple soft quarters, and Services hit another all-time record at $30.98 billion."
"Wedbush sees $15 billion in incremental annual Services revenue from AI features and storage, with a $400 price target. Evercore ISI carries a $365 target, citing compounding earnings and free cash flow. Prediction markets price a 95.7% probability of an iPhone 18 launch in 2026."
"Apple trades at a trailing P/E of 37, a forward P/E of 34, a PEG of 3, and a price-to-book of 42. Free cash flow yield is just 2.20%, thin compensation versus current Treasury yields."
"The bear case rests on the math. Fundamentals are accelerating, but valuation already reflects the optimism. The consensus analyst target of $308.65 sits barely above the current price, implying minimal published upside even as growth runs in"
Read at 24/7 Wall St.
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