Is Apple Stock Outperforming the S&P 500?

With a market cap of $4.6 trillion, Apple Inc. (AAPL) is one of the world’s most valuable and recognizable technology companies, built around a tightly integrated ecosystem of hardware, software, and services. 

Companies worth $200 billion or more are generally described as “mega-cap stocks,” and AAPL definitely fits that description, with its market cap exceeding this threshold, reflecting its substantial size, influence, and dominance in the consumer electronics industry. Its iconic brand commands remarkable loyalty and premium pricing, while the seamless connection between the iPhone, Mac, Apple Watch, AirPods, and services such as iCloud creates an ecosystem that keeps customers coming back for more. 

Despite its notable strength, AAPL stock has retreated 8.7% from the 52-week high of $344.57 on July 29. Over the past three months, AAPL stock has gained 1.2%, underperforming the S&P 500 Index ($SPX), has rallied 2.8% during the same time frame.

Shares of AAPL climbed 15.7% on a YTD basis and rose 36.5% over the past 52 weeks, underperforming SPX’s YTD gains of 12.9% and 19.3% returns over the last year.

To confirm the bullish trend, AAPL has been trading above its 200-day moving average for the past year and above its 50-day moving average recently. 

Apple has outperformed the broader market over the past year primarily because of a powerful resurgence in iPhone demand, accelerating Services revenue, and strong profitability. The iPhone 17 cycle helped drive robust sales growth, while record Services revenue, higher average selling prices, and margin expansion reinforced investor confidence in Apple’s ability to grow earnings even in a challenging consumer environment. 

Apple shares rose 2.3% on Aug. 19, after the company unveiled a major overhaul of its App Store terms for European developers, easing concerns around its long-running regulatory battle in the region. Apple plans to replace its controversial Core Technology Fee with a simpler 5% commission on certain digital transactions, a move investors viewed as reducing legal and financial uncertainty. Sentiment was further boosted by Rothschild & Co Redburn’s recent upgrade of the stock to “Buy,” citing potential upside from Apple’s AI ambitions and a possible foldable iPhone.

In the competitive arena of consumer electronics, Sony Group Corporation (SONY) has lagged behind Apple, with a 6% downtick on a YTD basis and a 13.5% loss over the past 52 weeks.

Wall Street analysts are reasonably bullish on AAPL’s prospects. The stock has a consensus “Moderate Buy” rating from the 41 analysts covering it. Its mean price target of $328.62 suggests a 4.5% upside potential from the current market price.