The holidays may be a few months away, but one glance at the headlines shows that Christmas has come early for gadget lovers. Amid much fanfare, Apple Inc. (AAPL) unveiled a number of new products that will hit shelves over the next few months. Let’s take a look at the highlights and see whether AAPL is still a buy at current prices.
First, Apple revealed the iPhone 6s and iPhone 6s Plus. In addition to being more powerful, more durable and having a higher resolution screen, this generation has a few new bells and whistles. A new 3D Touch interface allows for more flexibility in navigating through different apps and browsers. The new iPhone’s camera also takes 4K video, which can be seamlessly transferred to other Apple devices for editing. Both models will become available in the U.S. and select countries on September 25.
Second, Apple revealed dramatic upgrades to the Apple TV. Apple developed a special operating system, tvOS, for the smart television. Because tvOS is based on iOS, users will be able to run many of the same apps and games on the Apple TV as they do on their iPhones and iPads. This includes media and streaming apps like iTunes, Netflix, Hulu, HBO and Showtime. The remote also features Siri, Apple’s proprietary voice recognition and personal assistant software.
Third, Apple announced the new iPad Pro, which is now as powerful as many laptops. This tablet also has a larger screen, yet is still thin and light like its predecessor. The battery life has also been improved. For those looking to accessorize, Apple also developed the $100 Apple Pencil for the iPad Pro. This stylus is designed to for precision.
Finally, Apple developed a new operating system for the Apple Watch, and is making iOS 9 free for iPhone, iPad and iPod users on September 16.
With all of these developments in the works, Apple is looking great for the long haul. This quarter, the consensus estimate is for 22.2% annual sales growth and 31.7% earnings growth. For FY 2015 Apple is expected to post 27.5% sales growth and 41.3% earnings growth.
Apple is also engaged in a massive $140 billion stock buyback program and pays a 1.9% dividend. And did I mention that the stock trades at less than 12 times forecasted earnings?
So after this latest Apple reveal, I still consider AAPL a B-rated Buy.