Is Apple Inc. (AAPL) the Best Fundamental Stock to Buy According to Billionaires?
April 8, 2025
We recently published a list of 10 Best Fundamental Stocks to Buy According to Billionaires. In this article, we are going to take a look at where Apple Inc. (NASDAQ:AAPL) stands against other best fundamental stocks to buy according to billionaires.
As per Fitch Ratings, the US tariffs are now at levels that continue to transform the global economic outlook, meaningfully increasing the US recession risks as well as constraining the US Fed’s ability to reduce the interest rates further. The ratings agency believes that tariff hikes are expected to result in increased consumer prices and reduced corporate profits in the US. The increased prices can squeeze real wages, impacting consumer spending, with reduced profits and policy uncertainty weighing over business investments. Notably, upward pressure on goods prices due to tariffs would mean that the US Fed is likely to become more cautious when it comes to further rate cuts.
In the base case (to which UBS assigns a 50% probability), the firm anticipates tariffs to be reduced from the levels that have been announced. That being said, the process is expected to take some time. UBS anticipates that there can be a tariff-related slowdown in growth in Q2 and Q3. Even if tariffs get reduced by the end of the year, the shock and related uncertainty can result in a near-term slowdown in the broader US economy, impacting FY 2025 growth.
UBS believes that market uncertainty is expected to remain elevated, with investors focusing on potential downgrades to consensus US economic and earnings growth projections, the risk related to the tit-for-tat escalation, among others. Therefore, there can be an extended period of volatility for the broader US equities.
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.
Despite the uncertainties, UBS expects that the market will end the year higher. Apart from themes of AI and Power and resources, the firm has identified longevity and companies benefiting from the megatrend as the third Transformational Innovation Opportunity. The investors can also consider using yield-generating strategies so that they can benefit from current increased levels of volatility. UBS says that since the tariffs have been announced, negotiations to soften can now start.
Furthermore, the tariff revenue can be utilised to offset the cost of extending tax cuts. Additionally, the Fed may respond to weakening growth by cutting interest rates. Morningstar believes that some of the leading mega-cap stocks rated as “wide moat” have experienced a decline this year. The firm believes that wide-moat stocks are the most attractively valued, and it sees value throughout the entire range of such stocks.
To list the 10 Best Fundamental Stocks to Buy According to Billionaires, we sifted through Vanguard S&P 500 ETF and Insider Monkey’s exclusive database of billionaire stock holdings to shortlist the companies that have at least ~8% revenue and net income growth over the past 5 years. For the stocks with the same number of billionaire holdings, we have used the number of hedge fund investors as a secondary metric to rank the stocks, as of Q4 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A wide view of an Apple store, showing the range of products the company offers.
5-year Revenue Growth: 8.13%
5-year Net Income Growth: 10.8%
Number of Billionaire Investors: 21
Number of Hedge Fund Holders: 166
Goldman Sachs reiterated a “Buy” rating on Apple Inc. (NASDAQ:AAPL)’s stock with a maintained price objective of $294.00. The shipments of foreign-branded smartphones, including the company’s iPhone, in China went up by 9.2% in February YoY, as per Reuters calculations. Goldman Sachs’ strong support for Apple Inc. (NASDAQ:AAPL)’s stock reflects its confidence in the company’s performance despite the evolving market conditions in China. Notably, the market share dynamics as well as the recent product release remain the key factors in the firm’s analysis of Apple Inc. (NASDAQ:AAPL)’s stock. Elsewhere, Tigress Financial Partners exhibited optimism, with the firm maintaining a “Strong Buy” rating and increasing the price objective to $300, highlighting the company’s growth in services and innovation.
The integration of advanced AI capabilities into iPhones provides a strong growth opportunity for Apple Inc. (NASDAQ:AAPL) to fuel future upgrades and revenue growth. The features, including advanced image recognition, enhanced natural language processing, and personalized AI assistants, can offer reasons for customers to upgrade their devices. This can fuel iPhone sales and engagement with Apple Inc. (NASDAQ:AAPL)’s services ecosystem.
Columbia Threadneedle Investments, an investment management company, published its Q4 2024 investor letter. Here is what the fund said:
“The fund maintained a position in Apple Inc. (NASDAQ:AAPL) throughout the quarter through the release of the company’s new iPhone 16 in September. Company leaders were excited about the release of the new model, as this is the first model that will feature enhanced AI capabilities through the Apple Intelligence features. Sales for the first few weeks in October and November trailed behind year over year sales from the iPhone 15, as availability of Apple Intelligence was not compatible with all iPhone models. Apple announced a partnership with OpenAI that has allowed the integration of ChatGPT into the Apple ecosystem, separate from the core Apple Intelligence features. This partnership highlights continued progress from Apple to introduce AI capabilities into its products and we expect the iPhone 17 to have even more expansive AI capabilities, increasing potential demand for the new model that is on track to be released in 2025.”
Overall, AAPL ranks 9th on our list of best fundamental stocks to buy according to billionaires. While we acknowledge the potential of AAPL as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for a deeply undervalued AI stock that is more promising than AAPL but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
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