Why I Can’t Stop Buying This $3 Trillion Tech Titan Even as a “Rate Shock” Threatens to Tank Wall Street

The post Why I Can’t Stop Buying This $3 Trillion Tech Titan Even as a “Rate Shock” Threatens to Tank Wall Street appeared first on 24/7 Wall St..

I keep hitting the buy button on Apple (NASDAQ:AAPL), and the June panic over Fed Chair Kevin Warsh has only made my finger faster. Momentum traders are dumping high-flying tech indiscriminately, terrified Warsh will hold or hike to stamp out sticky inflation, and Apple has been dragged back under the $300 threshold at $299.24. I am buying that dip hand over fist, and here is why I cannot stop.

The thesis I keep coming back to

Apple is more than a phone maker. It is a tollbooth on 2.5 billion active devices whose owners willingly pay rent every month for Services, Music, iCloud, and the App Store. That installed base is the moat. Every quarter it widens, and every quarter the high-margin Services line takes a bigger share of the mix. When I look at Apple, I see a consumer hardware business wrapped around a recurring-revenue compounder, and the market keeps offering it to me cheaper than it should.

The receipts

Start with the latest earnings report. Q2 FY2026 revenue hit $111.18 billion, up 16.6% year over year, with EPS of $2.01 against a $1.94 consensus, the eighth consecutive quarterly beat. iPhone alone delivered $56.99 billion on extraordinary demand for the iPhone 17 lineup, and Services notched another all-time record at $30.98 billion. Tim Cook called it “our best March quarter ever, with revenue of $111.2 billion and double-digit growth across every geographic segment.” Greater China, the region everyone wrote off, came back to $20.50 billion.

Then there is the capital return. The board approved a 4% dividend increase and a fresh $100 billion buyback authorization, on top of $90.7 billion in FY2025 repurchases. A board does not approve $100 billion in fresh buybacks if it is nervous about demand. That is a confidence signal in size.

Finally, the profitability. Return on equity sits at 141.5%, operating margin at 32.3%, and trailing EPS at $8.27. Q1 FY2026 operating cash flow accelerated 80.14% year over year to $53.92 billion. Businesses that throw off cash like this during a rate scare are exactly what I want in a retirement portfolio.

The risk I will not pretend away

The valuation is rich. A trailing P/E of 36 and forward P/E of 31 leave no room for an earnings stumble, and a Warsh-driven rate shock would compress multiples on every long-duration cash-flow story Apple included. A widely shared Reddit thread asked whether there is “underappreciated risk of AAPL re-rating significantly downward”, and I take that seriously. Add tariff exposure and China manufacturing concentration, and the bear case is coherent. It just is not strong enough to outweigh an 8-quarter beat streak, a widening Services moat, and a board buying back stock at this pace.

What keeps my finger on the buy button

The one-year total return of 51.41% and the ten-year return of 1,278.94% were forged through rate hikes, trade wars, and pandemics, by a company that kept compounding while everyone else explained why this time was different. Thirty of forty-eight covering analysts still rate it Buy or Strong Buy, with a $312.72 target. Warsh can spook the stock for a week. He cannot break a 2.5 billion-device tollbooth, and that is the only timeframe that matters to me.

The post Why I Can’t Stop Buying This $3 Trillion Tech Titan Even as a “Rate Shock” Threatens to Tank Wall Street appeared first on 24/7 Wall St..