Apple’s (NASDAQ:AAPL) incredible run to the $300 level now puts the value stock at odds with the long-term upside potential. At a P/E in the 25 times range, markets are now pricing in unquestionable growth ahead. Apple’s iPhone and services revenue will surely grow in the quarter but investors predict Apple TV+ will take Netflix’s (NASDAQ:NFLX) market share.
Assuming that Apple TV+ will enjoy at least 50 million subscribers subscribes might be too optimistic. Apple does not have a hit title to rely on. Conversely, the newly-launched Disney (NYSE:DIS) Plus has The Mandalorian. This may at least keep trial users on the Disney platform.
Beefing up the executive ranks with a former HBO boss, Richard Plepler, might help grow the Apple TV+ division. The streaming service will need television series and feature films that are on par with AT&T’s (NYSE:T) HBO Max. That Game of Thrones lifted HBO’s value to new highs suggests Plepler may do the same for Apple TV+.
For now, it is too early to forecast the success of Apple’s streaming ambitions. Investors will need to look at iPhone unit sales for the holiday quarter to justify the stock running above the $300 level. From there, revenue from streaming services, app sales, MacBook, iPad, and Apple
Watch sales might just give the stock another lift.