Twenty years ago, investing in Apple Inc. (AAPL) might have seemed like a fairly unremarkable decision. At the time, the tech giant was still finding its footing in the early days of the personal computing revolution.
However, hindsight reveals that those who took a chance on Apple two decades ago would reap incredible rewards today. But, how rich would you truly be?
Over the past twenty years, Apple's stock value has experienced significant growth, driven by the company's innovative technology advancements and leading presence in the global market. Investing $1,000 in Apple stock back then would have resulted in a substantial return today.
How rich would you be if you bought Apple 20 years ago?
Throwing just $1000 into Apple twenty years ago would have you sitting on more than $501,500 today! This works out to be an annualized return of 36.43%, nearly 6x the returns of the S&P 500
Here is a chart to put it into perspective.
Why you probably didn't buy Apple stock 20 years ago
Twenty years ago, Apple was a modestly sized technology company, far from the trillion-dollar behemoth it is today. An investment in Apple back then would have rewarded long-term shareholders handsomely.
However, at the time, it was a company amid an operational turnaround, and its share price had done nothing for a very long time. From 2000 to 2003, the stock lost more than 63% of its value.
If you bought on the turnaround in 2003, you've realized exponential returns
Since then, Apple's market capitalization has grown from just $5.2 billion to around $2.75 trillion, making it the most valuable public company in the world.
One of the factors contributing to this immense growth is Apple's strong revenue and earnings performance over the years. Product launches such as the iPhone, iPad, and Mac computers have increased revenues for the company. In addition, Apple's focus on services and software has diversified its income streams, providing stability and additional growth potential.
Dividends also played a role in the wealth creation for Apple shareholders. In 2012, the company started paying a quarterly dividend, providing additional income for investors. Over time, these dividends have grown, and reinvesting them into additional shares of Apple stock has resulted in compounded growth.
Comparing Apple's performance to the broader market, it's evident that Apple has significantly outperformed the S&P 500 index over the past 20 years. If an investor had opted for an S&P 500 index fund instead of investing specifically in Apple, their returns would have been less impressive.
While S&P 500 index funds have generally provided stable and consistent growth, the annualized total return of Apple's stock has dwarfed that of the market benchmark.
What does Apple do?
Apple Inc. is a multinational technology company famously known for its innovative and cutting-edge consumer electronics and software products. Its flagship products include the iPhone, iPad, Macintosh computers, Apple Watch, and Apple TV.
Apple has also ventured into services like the App Store, Apple Music, iCloud, and Apple Pay, cementing its position as a market leader.
In recent years, Apple has also expanded its presence into artificial intelligence (AI) technologies. AI forms a crucial component in Apple's current products, including intelligent voice assistant Siri and the development of advanced chips for use in AI systems, not to mention its potential investments and breakthroughs in autonomous vehicles.
Regarding the company's stock, Apple has consistently outperformed its competitors, such as Microsoft, Intel, Amazon, NVIDIA, Netflix, and Adobe.
Due to its innovative product lineup and strong financials, Apple has become one of the most valuable public companies in the world.
Apple's stock price has grown tremendously, rewarding its long-term investors with substantial returns. It's worth mentioning that, in the past two decades, the company has carried out several stock splits, making Apple shares more accessible to individual investors.
Besides, the tech giant shares a prestigious position with other key US stock players such as IBM, Microsoft, Intel, Amazon, NVIDIA, Netflix, and Adobe.
The journey of Apple's stock over 2 decades
Apple's stock (AAPL) has experienced tremendous growth over the past 20 years. In this period, it has outperformed many other tech giants such as Microsoft, Intel, Amazon, NVIDIA, Netflix, Adobe, and IBM. The company's performance in the stock market puts it far ahead of its competitors, with impressive returns for investors.
New product releases like the iPhone, iPad, and MacBook series have positively influenced Apple's stock price. These revolutionary products have helped the company solidify its position in the global technology market.
Comparatively, during the same time frame, other major tech stocks like Microsoft, Amazon, and NVIDIA have also shown gains but have not reached the exceptional level of growth that AAPL has achieved.
In terms of market capitalization, Apple has been the largest company in the US stock market for quite some time.