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Is it Wise to Invest in Apple ETFs Post Q2 Earnings Results?
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The coronavirus pandemic has compelled investors to closely scrutinize corporate earnings to that could brave the brutal coronavirus pandemic. In such a scenario, it is obvious that tech giant Apple Inc.’s (AAPL - Free Report) second-quarter fiscal 2020 earnings and revenue beats haven’t gone unnoticed.
Q2 Earnings at a Glance
Earnings per share came in at $2.55, surpassing the Zacks Consensus Estimate by 22% and improving 3.7% from the year-ago earnings. Net sales rose 0.5% year over year to $58.31 billion and beat the estimate by 8.7%. Product sales were down year over year due to measures like lockdown and store closures to control the outbreak during the last three weeks of the reported quarter. Meanwhile, the company observed strength in Services revenues and Wearables, Home and Accessories sales.
Services revenues, comprising App Store, Apple Music, Video, iCloud, Apple Care and App Store search ad business, climbed 16.6% year over year to a new all-time high of $13.35 billion. Revenues from Wearables, Home and Accessories, which includes the Apple Watch, AirPods, HomePod, Apple TV, and Beats headphones, soared 22.5% to $6.28 billion. Meanwhile, iPhone sales declined 6.7% year over year to $28.96 billion while Mac revenues dropped 2.9% to $5.35 billion. iPad revenues also fell 10.3% to $4.37 billion. Notably, Apple didn’t provide any guidance given the coronavirus-induced uncertainty. However, the company anticipates forex to dent revenues by $1.5 billion year over year, largely due to U.S. dollar appreciation.
Market Impact
Following the results on Apr 30 after market close, shares of Apple climbed around 1.3% as of May 5. The stock currently has a Zacks Rank #3 (Hold).
Apple ETFs to Watch Out For
ETFs having the highest allocation to this tech titan have been in focus post its earnings announcement. While there are several ETFs in the space with Apple in their top 10 holdings, we have highlighted the ones that have Apple at the top or second position, with double-digit allocation:
Vanguard Information Technology ETF (VGT - Free Report) – It has AUM of $26.60 billion and sports a Zacks ETF Rank #1. Here, AAPL takes 18.3% share.
iShares U.S. Technology ETF (IYW - Free Report) – The fund has amassed $4.87 billion in its asset base and carries a Zacks ETF Rank #1. Apple accounts for 17.8% of the assets.
iShares Global Tech ETF (IXN - Free Report) – The product has accumulated $3.24 billion in its asset base. Apple accounts for 16.2% allocation.
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Is it Wise to Invest in Apple ETFs Post Q2 Earnings Results?
The coronavirus pandemic has compelled investors to closely scrutinize corporate earnings to that could brave the brutal coronavirus pandemic. In such a scenario, it is obvious that tech giant Apple Inc.’s (AAPL - Free Report) second-quarter fiscal 2020 earnings and revenue beats haven’t gone unnoticed.
Q2 Earnings at a Glance
Earnings per share came in at $2.55, surpassing the Zacks Consensus Estimate by 22% and improving 3.7% from the year-ago earnings. Net sales rose 0.5% year over year to $58.31 billion and beat the estimate by 8.7%. Product sales were down year over year due to measures like lockdown and store closures to control the outbreak during the last three weeks of the reported quarter. Meanwhile, the company observed strength in Services revenues and Wearables, Home and Accessories sales.
Services revenues, comprising App Store, Apple Music, Video, iCloud, Apple Care and App Store search ad business, climbed 16.6% year over year to a new all-time high of $13.35 billion. Revenues from Wearables, Home and Accessories, which includes the Apple Watch, AirPods, HomePod, Apple TV, and Beats headphones, soared 22.5% to $6.28 billion. Meanwhile, iPhone sales declined 6.7% year over year to $28.96 billion while Mac revenues dropped 2.9% to $5.35 billion. iPad revenues also fell 10.3% to $4.37 billion. Notably, Apple didn’t provide any guidance given the coronavirus-induced uncertainty. However, the company anticipates forex to dent revenues by $1.5 billion year over year, largely due to U.S. dollar appreciation.
Market Impact
Following the results on Apr 30 after market close, shares of Apple climbed around 1.3% as of May 5. The stock currently has a Zacks Rank #3 (Hold).
Apple ETFs to Watch Out For
ETFs having the highest allocation to this tech titan have been in focus post its earnings announcement. While there are several ETFs in the space with Apple in their top 10 holdings, we have highlighted the ones that have Apple at the top or second position, with double-digit allocation:
Technology Select Sector SPDR Fund (XLK - Free Report) – The fund has AUM of $27.22 billion and a Zacks ETF Rank #1 (Strong Buy). Apple makes up for 20% of the assets (read: Buy 5 Solid Tech ETFs At Least 10% Away From 52-Week High).
Fidelity MSCI Information Technology Index ETF (FTEC - Free Report) – This fund has a Zacks ETF Rank #1 and AUM of $3.42 billion. Apple has 18.8% allocation (read: Stay-At-Home Fuels Microsoft Q3 Earnings: ETFs to Buy).
Vanguard Information Technology ETF (VGT - Free Report) – It has AUM of $26.60 billion and sports a Zacks ETF Rank #1. Here, AAPL takes 18.3% share.
iShares U.S. Technology ETF (IYW - Free Report) – The fund has amassed $4.87 billion in its asset base and carries a Zacks ETF Rank #1. Apple accounts for 17.8% of the assets.
iShares Global Tech ETF (IXN - Free Report) – The product has accumulated $3.24 billion in its asset base. Apple accounts for 16.2% allocation.
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 >>