Is It Too Late to Buy Apple Stock?

For much of 2026, Apple (NASDAQ: AAPL) stock looked like a laggard. A drawdown earlier in the year had shares down by mid-single digits at one point in April. But sentiment has flipped quickly following the iPhone maker's recently posted record fiscal second-quarter results, which have helped the stock rally over the past month, putting shares at an all-time high on Friday.

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I don't think so. Below are a few reasons the stock could still have room to run.

Apple's fiscal second-quarter results, posted on April 30, showed how quickly the company's narrative has shifted. Total revenue rose 17% year over year to $111.2 billion -- the company's best March quarter on record -- with double-digit growth across every geographic segment and growth across every product category. iPhone revenue grew 22% to nearly $57 billion despite supply constraints. Cook described the iPhone 17 lineup as "the most popular lineup in our history" on the earnings call.

But Apple's strong growth was broad-based. Services revenue hit an all-time high of about $31 billion, up about 16%. And sales in its important Greater China market jumped 28% to $20.5 billion. Further, Apple's gross margin climbed from 47.1% in the year-ago quarter to 49.3%, helping push earnings per share up 22% -- a rate that exceeded Apple's revenue growth rate, highlighting the company's operating leverage.

And the trajectory looks intact. Management guided for revenue growth of 14% to 17% in the current quarter -- a pace that would mark a third straight quarter of double-digit top-line growth, after several years when Apple's growth had stalled. Sure, the company continues to face supply constraints related to some chip parts. But that also means investors can rest assured that demand for Apple's products is clearly strong.

The other big shift is Apple's posture on artificial intelligence (AI). After lagging on AI features for much of 2025, the company struck a multi-year deal in January with Alphabet's Google to use a Gemini models and cloud technology to power the long-promised personalized Siri. And Apple is now saying that its revamped assistant is expected to roll out later this year.

A revitalized, AI-infused Siri could mark the beginning of more powerful AI integrations for Apple and prove to be a major tailwind.

Apple's installed base of more than 2.5 billion active devices is among the most monetizable distribution networks in tech, and a more capable Siri may accelerate both device upgrades and innovation in services over time.

And to support its growth initiatives, Apple is ramping up spending. Research and development spending climbed 34% in the most recent quarter to $11.4 billion.

"AI is a really important investment area for Apple, and we're going to be doing that incrementally on top of what we normally invest in our product roadmap," said chief financial officer Kevan Parekh during the company's fiscal second-quarter earnings call.

Last month, Apple announced that Cook will become executive chairman on Sept. 1 and that John Ternus, the company's senior vice president of hardware engineering, will take over as the new CEO. Ternus, 51, has been at Apple since 2001, serving under both Steve Jobs and Tim Cook. His fingerprints are on the iPad and AirPods launches, and he played a crucial role in the multi-year Mac transition to Apple silicon -- arguably the most successful platform pivot the company has executed in over a decade.

On the earnings call, Ternus said "this is the most exciting time in my 25-year career at Apple to be building products and services." That's the right tone for a moment when product execution, including a potential foldable iPhone, the AI-powered Siri rollout, and likely an introduction of a range of new AI features, is all on the table.

Of course, none of this comes without risk. With a forward price-to-earnings ratio of about 33, the stock isn't cheap by any means. This introduces some valuation risk; if unexpected issues arise, like iPhone 18 demand disappointing or Apple's Siri overhaul fumbling, the stock's valuation multiple has meaningful room to fall.

On the other hand, between a business that's inflecting, an AI strategy that is building momentum, and an incoming CEO who could revitalize the company's product innovation, I think the stock is worth its premium today, as there are ways the company could surprise to the upside, too.

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Daniel Sparks and his clients have positions in Apple. The Motley Fool has positions in and recommends Alphabet and Apple. The Motley Fool has a disclosure policy.

Is It Too Late to Buy Apple Stock? was originally published by The Motley Fool