Turned $1,000 into over $1.7 million in one stock

Every investor will agree that the stock market is an excellent asset class for people to accumulate life-changing wealth. Compound interest can work wonders and bring huge gains.

However, there are some specific business existStandard & Poor's 500indices (S&P 500(used for emphasis)Definition of absolute overpowering the market . Look at the tech giants. Apple Inc. (NASDAQ resonance code: AAPL)as soon as Got it! The iPhone maker has generated an aggregate return of 170,000% for its shareholders since it began trading on the open market in December 1980. Since the iPhone maker began trading on the open market in December 1980, it has generated an aggregate return of 170,000% for its shareholders. This staggering return means that what was a $1,000 investment in the past is now worth a staggering $1.7 million.

Apple is undoubtedly one of the most remarkable success stories in American business, and it is worthwhile to look back and try to understand what factors contributed to its rise. Only then can we answer the question of what made this company so successful. Consumer stocks at the presentis or isn't It is worth adding the name of the person.

One of the world's most valuable companies

As of this writing, Apple has a market capitalization of $2.7 trillion. Only Microsoft Corporation The market value of the company is even higher. It is impossible for a company to reach such a valuation without doing something right.

Apple's stock price has performed so well precisely because the company's revenue and net income have historically soared. Perhaps the most important factor driving Apple's business is its incredible brand strength, which has supported Apple's economic moat The company's ability to sell hardware devices that are popular with consumers also provides Apple with pricing power, which keeps competitors at bay. The sale of popular hardware devices also provides Apple with pricing power.

When it comes to hardware, this company is probably the best at product innovation. The iPhone is probably the greatest product in modern history, both economically and in terms of its impact on society. Apple's ability to do this extends to other areas, including hardware and services.

Apple may be a U.S.-born company, but there is no denying that it has become a global icon. In fiscal year 2023, the majority of the total revenue will come from outside the United States.

Should You Buy Apple Stock Now?

Even in the recent past, Apple stock has been a big winner. Over the past five years, Apple shares have risen 2,49%, a gain that has overwhelmed Nasdaq Resonance IndexThe great Warren Buffett is a big fan of this business. The great Warren Buffett is a big fan of this business, making Apple nowadaysexistBerkshire Hathaway(used for emphasis)Name of the personcenterIt has a significant weighting of 43%. The

But with the stock price down 12% from the peak reached late last year, is Apple a smart buy? To be clear, I don't think investors should add this company to their portfolio. There are two reasons why I strongly believe this.

The first is Apple's growth prospects. Today, it is an extremely mature company. It still relies heavily on the success of the iPhone, and hopes that consumers will continue to upgrade their devices as often as possible, even though the new features may not be as game-changing as they were a decade ago.

Yes, the Services Division's sales have been steady but improving. But that won't be enough to prevent Apple from experiencing a revenue decline in fiscal 2023. There's no reason to believe that the business unit will be able to launch revolutionary products that will lead to meaningful revenue growth in the future.

Apple's current valuation also leads me to believe that its earnings potential is limited. Today, you can take 27.3(used form a nominal expression)PE ratioBuy Apple Shares The It's reasonable to think that a company with such a competitive advantage and superior profitability deserves this kind of valuation. However, I think this is an expensive entry point, and one that greatly reduces the likelihood that Apple will outperform the S&P 500 over the next few years.

This stock has been a big winner in the past. I am not sure if this trend will continue.

Should you invest $1,000 in Apple now?

Before buying Apple stock, consider the following:

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Neil Patel and his clients do not own any of the stocks mentioned above.The Motley Fool holds shares of Apple, Berkshire Hathaway, and Microsoft.The Motley Fool recommends the following options: long Microsoft January 2026 $395 calls and short Microsoft January 2026 $405 calls.The Motley Fool has a disclosure policy. The Motley Fool has a disclosure policy.

1 Stock Turns $1,000 Into Over $1.7 Million was originally published by The Motley Fool.