Apple’s (NASDAQ: AAPL) stock price has generated robust gains throughout the pandemic year, driven mostly by Apple’s revenue diversification strategies along with the introduction of 5G supported devices.
The broader tech market rally has also supported the upside gains. Apple stock price rallied 80% in 2020, accelerating the five-year gains to 388%. Its market cap stretched to $2.2 trillion this year, while valuations are also standing at record levels.
Its share price gained momentum during the second quarter while strong financial performances helped sustain those gains rest of the year.
Revenue diversification strategies backed 2020 gains
Apple’s financial numbers were previously dependent on iPhone sales. However, the company has started investing in other areas to expand the revenue base over the past two years.
Despite pandemic and a drop in iPhone sales, the world’s largest tech giant has set record September quarter revenue, earnings per share, and free cash flow, thanks to non-iPhone revenue.
Its iPad revenue came in at $6.8 billion, while Mac revenue stood around $9.03 billion. Wearables, Home, and Accessories revenue came in at $7.9 billion while services revenue hit an all-time high of $14.5 billion in the September quarter.
Expect more gains for 2021
The largest technology company is in a strong position to extend share price gains ahead. This is because of the 5G supported smartphones and other devices. In addition, the latest development of entering into the auto market has further enhanced the future fundamentals.
“We believe based on our investor conversations over the last few days that many on the Street would rather see Apple partner on the EV path, than start building its own vehicles/factories given the margin and financial model implications down the road, coupled with the strategic product risk around such a gargantuan endeavor,” Wedbush Securities analyst Dan Ives said.