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Apple Inc. (AAPL - Free Report) reported solid first-quarter fiscal 2024 results, wherein it beat estimates on both earnings and revenues. The iPhone manufacturer returned to quarterly sales growth after four straight quarters of declines. However, a decline in China sales pulled down the stock.
Apple shares dropped as much as 3% in after-market hours on China concerns, erasing $84 billion of the company's market valuation. This has put ETFs having the largest allocation to the tech titan in focus. Technology Select Sector SPDR Fund (XLK - Free Report) , Vanguard Information Technology ETF (VGT - Free Report) , MSCI Information Technology Index ETF (FTEC - Free Report) , iShares US Technology ETF (IYW - Free Report) and Vanguard Mega Cap Growth ETF (MGK - Free Report) have Apple as the top or second firm with a double-digit allocation and carry a Zacks Rank #1 (Strong Buy) or 2 (Buy).
Apple Earnings in Focus
Earnings per share came in at $2.18, beating the Zacks Consensus Estimate of $2.09 and improving 16% year over year. Revenues grew 2% year over year to $119.6 billion and edged past the estimated $117.6 billion. The revenue growth ended the four straight quarters of sales declines and was boosted by iPhone 15 handset sales and services growth (see: all the Technology ETFs here).
iPhone sales grew 6% to $69.7 billion. Services revenues, comprising iTunes, Apple Music, iCloud, Apple Pay and Apple Care, rose 11% year over year to an all-time high of $23.1 billion. Revenues from Wearables, Home and Accessories, which includes Apple Watch, AirPods, HomePod, Apple TV and Beats headphones, declined 11% to $12 billion. Mac sales rose a fraction to $7.8 billion, while iPad sales declined 25% to $7 billion. Apple is still struggling in China, with sales falling 12.9% year over year to $20.8 billion.
The tech giant offered a cautious outlook for the ongoing quarter. Apple CFO Luca Maestri indicated that iPhone sales in the March quarter would be similar to last year’s $51.33 billion in revenues. This excludes $5 billion in sales attributed to outperformance a year ago as supply recovered from COVID-19 shutdowns and caught up to demand.
Technology Select Sector SPDR Fund targets the broad technology sector and follows the Technology Select Sector Index. It holds about 64 securities in its basket, with Apple making up for 20.4% share. Technology Select Sector SPDR Fund has key holdings in software, semiconductors and semiconductor equipment, and technology hardware, storage and peripherals.
Technology Select Sector SPDR Fund is the most popular and heavily traded ETF, with an AUM of $62.4 billion and an average daily volume of 7 million shares. The fund charges 9 bps in fees per year.
Vanguard Information Technology ETF manages $62.2 billion in its asset base and provides exposure to 312 technology stocks. It currently tracks the MSCI US Investable Market Information Technology 25/50 Index. Here, Apple accounts for 21.5% share. Systems software, technology hardware storage & peripheral, semiconductors, and application software are the top four sectors.
MSCI Information Technology Index ETF is home to 303 technology stocks with an AUM of $8.8 billion. It follows the MSCI USA IMI Information Technology Index. Apple accounts for a 21.6% share in the basket.
MSCI Information Technology Index ETF has an expense ratio of 0.08%, while volume is solid at 245,000 shares a day.
iShares Dow Jones US Technology ETF tracks the Russell 1000 Technology RIC 22.5/45 Capped Index, giving investors exposure to 133 U.S. electronics, computer software and hardware, and informational technology companies. Apple makes up 15.8% of the assets.
iShares Dow Jones US Technology ETF has an AUM of $15 billion and charges 40 bps in fees and expenses. Volume is good as it exchanges 668,000 shares a day.
Vanguard Mega Cap Growth ETF offers diversified exposure to the largest growth stocks in the U.S. market. It tracks the CRSP US Mega Cap Growth Index and holds 82 securities in its basket, with Apple accounting for 14.8% of the total assets (read: 5 Best Top-Ranked ETFs of 2023 Set to Soar in 2024).
Vanguard Mega Cap Growth ETF charges 7 bps in annual fees and trades in a good volume of around 337,000 shares a day on average. The fund has an AUM of $17.6 billion.
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Apple Returns to Revenue Growth: 5 ETFs in Focus
Apple Inc. (AAPL - Free Report) reported solid first-quarter fiscal 2024 results, wherein it beat estimates on both earnings and revenues. The iPhone manufacturer returned to quarterly sales growth after four straight quarters of declines. However, a decline in China sales pulled down the stock.
Apple shares dropped as much as 3% in after-market hours on China concerns, erasing $84 billion of the company's market valuation. This has put ETFs having the largest allocation to the tech titan in focus. Technology Select Sector SPDR Fund (XLK - Free Report) , Vanguard Information Technology ETF (VGT - Free Report) , MSCI Information Technology Index ETF (FTEC - Free Report) , iShares US Technology ETF (IYW - Free Report) and Vanguard Mega Cap Growth ETF (MGK - Free Report) have Apple as the top or second firm with a double-digit allocation and carry a Zacks Rank #1 (Strong Buy) or 2 (Buy).
Apple Earnings in Focus
Earnings per share came in at $2.18, beating the Zacks Consensus Estimate of $2.09 and improving 16% year over year. Revenues grew 2% year over year to $119.6 billion and edged past the estimated $117.6 billion. The revenue growth ended the four straight quarters of sales declines and was boosted by iPhone 15 handset sales and services growth (see: all the Technology ETFs here).
iPhone sales grew 6% to $69.7 billion. Services revenues, comprising iTunes, Apple Music, iCloud, Apple Pay and Apple Care, rose 11% year over year to an all-time high of $23.1 billion. Revenues from Wearables, Home and Accessories, which includes Apple Watch, AirPods, HomePod, Apple TV and Beats headphones, declined 11% to $12 billion. Mac sales rose a fraction to $7.8 billion, while iPad sales declined 25% to $7 billion. Apple is still struggling in China, with sales falling 12.9% year over year to $20.8 billion.
The tech giant offered a cautious outlook for the ongoing quarter. Apple CFO Luca Maestri indicated that iPhone sales in the March quarter would be similar to last year’s $51.33 billion in revenues. This excludes $5 billion in sales attributed to outperformance a year ago as supply recovered from COVID-19 shutdowns and caught up to demand.
ETFs in Focus
Technology Select Sector SPDR Fund (XLK - Free Report)
Technology Select Sector SPDR Fund targets the broad technology sector and follows the Technology Select Sector Index. It holds about 64 securities in its basket, with Apple making up for 20.4% share. Technology Select Sector SPDR Fund has key holdings in software, semiconductors and semiconductor equipment, and technology hardware, storage and peripherals.
Technology Select Sector SPDR Fund is the most popular and heavily traded ETF, with an AUM of $62.4 billion and an average daily volume of 7 million shares. The fund charges 9 bps in fees per year.
Vanguard Information Technology ETF (VGT - Free Report)
Vanguard Information Technology ETF manages $62.2 billion in its asset base and provides exposure to 312 technology stocks. It currently tracks the MSCI US Investable Market Information Technology 25/50 Index. Here, Apple accounts for 21.5% share. Systems software, technology hardware storage & peripheral, semiconductors, and application software are the top four sectors.
Vanguard Information Technology ETF has an expense ratio of 0.10%, whereas volume is solid at nearly 494,000 shares (read: Tech Leads S&P 500 to Highs: Does Further Rally Await ETFs?).
MSCI Information Technology Index ETF (FTEC - Free Report)
MSCI Information Technology Index ETF is home to 303 technology stocks with an AUM of $8.8 billion. It follows the MSCI USA IMI Information Technology Index. Apple accounts for a 21.6% share in the basket.
MSCI Information Technology Index ETF has an expense ratio of 0.08%, while volume is solid at 245,000 shares a day.
iShares US Technology ETF (IYW - Free Report)
iShares Dow Jones US Technology ETF tracks the Russell 1000 Technology RIC 22.5/45 Capped Index, giving investors exposure to 133 U.S. electronics, computer software and hardware, and informational technology companies. Apple makes up 15.8% of the assets.
iShares Dow Jones US Technology ETF has an AUM of $15 billion and charges 40 bps in fees and expenses. Volume is good as it exchanges 668,000 shares a day.
Vanguard Mega Cap Growth ETF (MGK - Free Report)
Vanguard Mega Cap Growth ETF offers diversified exposure to the largest growth stocks in the U.S. market. It tracks the CRSP US Mega Cap Growth Index and holds 82 securities in its basket, with Apple accounting for 14.8% of the total assets (read: 5 Best Top-Ranked ETFs of 2023 Set to Soar in 2024).
Vanguard Mega Cap Growth ETF charges 7 bps in annual fees and trades in a good volume of around 337,000 shares a day on average. The fund has an AUM of $17.6 billion.