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Take a Bite of Apple's Blowout Earnings With Top-Ranked ETFs
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Technology giant Apple Inc. (AAPL - Free Report) encouraged investors with blowout fourth-quarter fiscal 2017 results, after the closing bell yesterday. The company surpassed our earnings and revenue estimates, and offered an upbeat outlook for the holiday quarter.
Additionally, Apple expects the holiday season to result in the biggest quarter ever, eroding all concerns over manufacturing delays for iPhone X, Apple's 10th anniversary phone. This has propelled AAPL shares higher as much as 4% in after-hours trading to fresh highs resulting in a valuation of over $900 billion. With this, the iPhone maker has come closer to become the world’s first trillion-dollar company (read: Will Tech ETFs Hit New Highs Post Facebook, Apple Earnings?).
Apple Q4 Results in Focus
Earnings per share came in at $2.07, beating the Zacks Consensus Estimate by 20 cents and improving from the year-ago earnings of $1.87. Revenues grew 12.2% year over year to a record $52.58 billion and edged past our estimate of $51.17 billion. Revenues grew for the fourth consecutive quarter and witnessed the biggest increase in two years.
Stronger-than-expected iPhone sales, strong revenues from the service unit, which includes AppleCare, Apple Pay and Apple Music, as well as resurgent iPad and Mac sales were attributed to the robust performance.
Apple sold 46.7 million iPhones in the fiscal fourth quarter, up 3% year over year and above the Wall Street estimate of 46 million units. This has resulted in total revenues of $28.85 billion, representing a 2% increase from the year-ago quarter. Meanwhile, service revenues grew 34% to $8.5 billion (read: Tap Q3 Growth with Revenue-Weighted ETFs).
iPad and Mac sales increased 14% and 25%, respectively, while other products, such as Apple TV, Watch and AirPods, surged 36%. Further, Apple returned to revenue growth in China after six straight quarters of sales decline. Revenues in China increased 12% year over year to $9.8 billion.
The ubiquitous gadget-maker foresees revenues in the range of $84-$87 billion for the first quarter of fiscal 2018. This is much above the current Zacks Consensus Estimate of $83.31 billion.
Apple currently has a Zacks Rank #3 (Hold) and belongs to a solid Zacks Industry Rank in the top 9%, suggesting significant upside for the stock over the coming days. Further, Apple flaunts a solid Value Style Score of B.
ETFs in Focus
Given this, investors seeking to tap the bullishness in the tech titan could consider the following ETFs. These funds have Apple as their top firm with a double-digit allocation and a solid Zacks ETF Rank #1 (Strong Buy) or 2 (Buy) (see: all the Technology ETFs here):
This ETF provides investors exposure to technology stocks with 16.8% allocation in Apple. The fund has AUM of $4 billion and charges 44 bps in fees and expenses. It has a Zacks ETF Rank #1 and has gained 35.4% so far this year.
This most popular technology ETF has $19.2 billion in AUM and charges 14 bps in fees per year from investors. AAPL makes up for roughly 14.9% of assets. It has a Zacks ETF Rank #2 and has added 31.7% in the same time frame (read: Top ETF Stories of October 2017).
This fund manages about $16.1 billion in its asset base with 13.8% allocation in Apple. It has 0.10% in expense ratio and has a Zacks ETF Rank #2. VGT is up 35.5% in the same time frame.
With AUM of $1.3 billion, the product allocates 13.9% in Apple. The ETF has 0.08% in expense ratio and a Zacks ETF Rank #2. It has gained 35.4%.
iShares Edge MSCI Multifactor Technology ETF
This ETF targets companies that have the potential to outperform the broad U.S. technology sector. Apple accounts for 13.5% of the portfolio. TCHF charges 35 bps in fees per year and has attracted $6 million in its asset base. It has added 33.7% in the same time frame and carries a Zacks ETF Rank #2 (read: 5 Overlooked Tech ETFs Crushing XLK).
This ETF provides exposure to the largest domestic and international non-financial companies listed on the Nasdaq. Apple makes up for 12% allocation. QQQ is one of the largest and the most popular ETFs in the large-cap space with AUM of $56.6 billion. It charges investors 20 bps in annual fees and has surged 29% so far this year. The fund has a Zacks ETF Rank #2.
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Take a Bite of Apple's Blowout Earnings With Top-Ranked ETFs
Technology giant Apple Inc. (AAPL - Free Report) encouraged investors with blowout fourth-quarter fiscal 2017 results, after the closing bell yesterday. The company surpassed our earnings and revenue estimates, and offered an upbeat outlook for the holiday quarter.
Additionally, Apple expects the holiday season to result in the biggest quarter ever, eroding all concerns over manufacturing delays for iPhone X, Apple's 10th anniversary phone. This has propelled AAPL shares higher as much as 4% in after-hours trading to fresh highs resulting in a valuation of over $900 billion. With this, the iPhone maker has come closer to become the world’s first trillion-dollar company (read: Will Tech ETFs Hit New Highs Post Facebook, Apple Earnings?).
Apple Q4 Results in Focus
Earnings per share came in at $2.07, beating the Zacks Consensus Estimate by 20 cents and improving from the year-ago earnings of $1.87. Revenues grew 12.2% year over year to a record $52.58 billion and edged past our estimate of $51.17 billion. Revenues grew for the fourth consecutive quarter and witnessed the biggest increase in two years.
Stronger-than-expected iPhone sales, strong revenues from the service unit, which includes AppleCare, Apple Pay and Apple Music, as well as resurgent iPad and Mac sales were attributed to the robust performance.
Apple sold 46.7 million iPhones in the fiscal fourth quarter, up 3% year over year and above the Wall Street estimate of 46 million units. This has resulted in total revenues of $28.85 billion, representing a 2% increase from the year-ago quarter. Meanwhile, service revenues grew 34% to $8.5 billion (read: Tap Q3 Growth with Revenue-Weighted ETFs).
iPad and Mac sales increased 14% and 25%, respectively, while other products, such as Apple TV, Watch and AirPods, surged 36%. Further, Apple returned to revenue growth in China after six straight quarters of sales decline. Revenues in China increased 12% year over year to $9.8 billion.
The ubiquitous gadget-maker foresees revenues in the range of $84-$87 billion for the first quarter of fiscal 2018. This is much above the current Zacks Consensus Estimate of $83.31 billion.
Apple currently has a Zacks Rank #3 (Hold) and belongs to a solid Zacks Industry Rank in the top 9%, suggesting significant upside for the stock over the coming days. Further, Apple flaunts a solid Value Style Score of B.
ETFs in Focus
Given this, investors seeking to tap the bullishness in the tech titan could consider the following ETFs. These funds have Apple as their top firm with a double-digit allocation and a solid Zacks ETF Rank #1 (Strong Buy) or 2 (Buy) (see: all the Technology ETFs here):
iShares Dow Jones US Technology ETF (IYW - Free Report)
This ETF provides investors exposure to technology stocks with 16.8% allocation in Apple. The fund has AUM of $4 billion and charges 44 bps in fees and expenses. It has a Zacks ETF Rank #1 and has gained 35.4% so far this year.
Select Sector SPDR Technology ETF (XLK - Free Report)
This most popular technology ETF has $19.2 billion in AUM and charges 14 bps in fees per year from investors. AAPL makes up for roughly 14.9% of assets. It has a Zacks ETF Rank #2 and has added 31.7% in the same time frame (read: Top ETF Stories of October 2017).
Vanguard Information Technology ETF (VGT - Free Report)
This fund manages about $16.1 billion in its asset base with 13.8% allocation in Apple. It has 0.10% in expense ratio and has a Zacks ETF Rank #2. VGT is up 35.5% in the same time frame.
MSCI Information Technology Index ETF (FTEC - Free Report)
With AUM of $1.3 billion, the product allocates 13.9% in Apple. The ETF has 0.08% in expense ratio and a Zacks ETF Rank #2. It has gained 35.4%.
iShares Edge MSCI Multifactor Technology ETF
This ETF targets companies that have the potential to outperform the broad U.S. technology sector. Apple accounts for 13.5% of the portfolio. TCHF charges 35 bps in fees per year and has attracted $6 million in its asset base. It has added 33.7% in the same time frame and carries a Zacks ETF Rank #2 (read: 5 Overlooked Tech ETFs Crushing XLK).
PowerShares QQQ (QQQ - Free Report)
This ETF provides exposure to the largest domestic and international non-financial companies listed on the Nasdaq. Apple makes up for 12% allocation. QQQ is one of the largest and the most popular ETFs in the large-cap space with AUM of $56.6 billion. It charges investors 20 bps in annual fees and has surged 29% so far this year. The fund has a Zacks ETF Rank #2.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>