The Next Big Rally in Apple Stock Could Start Like This

The Next Big Rally in Apple Stock Could Start Like This

Apple (AAPL) has demonstrated powerful rallies historically, with more than 30% gains in under two months occurring in key years like 2012 and 2020. On two occasions, it even surged over 50% within similar short timeframes. If these patterns hold, future catalysts could drive Apple stock to remarkable new highs, offering substantial upside for investors.

Specifically, we see these catalysts:

1. iPhone 17 Demand Surge
2. Greater China Revenue Rebound
3. Entry-Level MacBook Launch

Catalyst 1: iPhone Revenue Surge

• Details: Accelerating revenue growth from the iPhone segment, increased high-margin Pro/Pro Max model sales mix. The trend could continue with impending launch of foldable iPhone this fall.
• Segment Affected: iPhone
• Potential Timeline: H2 2026
• Evidence: iPhone revenue surged 23% year-over-year in Q1 FY'26 driven by higher pricing and mix.

Catalyst 2: Greater China Revenue Rebound

• Details: Re-acceleration of growth in a key geographic segment, Market share gains against local competitors
• Segment Affected: Greater China
• Potential Timeline: Q2 2026 Earnings
• Evidence: Greater China revenue surged 38% in Q1 2026; iPhone shipments in China grew 20% year-over-year in Q1 2026

Catalyst 3: Entry-Level MacBook Neo Launch

• Details: Total addressable market expansion in the laptop segment, increased market share in the education sector.
• Segment Affected: Mac
• Potential Timeline: H1 2026
• Evidence: With Apple handling the current memory crunch better than rivals, it has the ability to win share from Windows PCs. The 12.9-inch MacBook with A18 Pro chip, priced between $599 and $699 launched in March, will help to a large extent.

But The Stock Is Not Without Its Risks

Here are specific risks we see:

• Margin Headwinds from Soaring Memory Costs
• CEO Transition and AI Strategy Uncertainty

Looking at historical drawdown during market crises is another lens to look at risk.

AAPL fell 80% in the Dot-Com crash, 61% in the Global Financial Crisis, and 39% in 2018's correction. Even Covid and inflation shocks pushed it down about 31% each.

Read AAPL Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.

Reference: Current Fundamentals

• Revenue Growth: 10.1% LTM and 4.1% last 3-year average.
• Cash Generation: Nearly 28.3% free cash flow margin and 32.4% operating margin LTM.
• Valuation: Apple stock trades at a P/E multiple of 34.2

*LTM: Last Twelve Months | If you want more details, read Buy or Sell AAPL Stock.

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Footnotes

iPhone 17 Demand Surge
[1] Apple's iPhone shipments in China surge 20% in Q1, data shows, Reuters