Should you buy Apple stock before January 30?

January 30 will be a huge day for Apple (AAPL 0.75%) stock, as that’s when the company reports results for the first quarter of fiscal 2025 (ending around Dec. 31). This is a huge deal, as it includes the all-important holiday quarter, which could make or break Apple’s stock.

Apple needs to change the narrative surrounding its stock, as the company has delivered rather stagnant growth over the past few years. The news could mark a big shift in sentiment for Apple stock, and it needs a strong report to maintain the status quo.

Apple needs to kick-start its revenue growth this year

Apple is one of the most recognizable consumer electronics brands worldwide. It has built a powerhouse on an ecosystem that connects seamlessly with each other’s devices and successfully captured the most important audience for any company: young consumers.

This drove significant growth for many years, but since 2022 revenue has not really grown.

AAPL Revenue (TTM) data of YCharts

These are years of stagnant revenue, which is not a good sign for a company. However, Apple is one of the best companies in the world, so that hasn’t stopped it from growing its earnings through a combination of share buybacks and improved profitability. Still, there’s only so much juice to squeeze when making a company more efficient, and Apple may be approaching its limit.

AAPL operating margin (quarterly) data of YCharts

This leaves share buybacks as the primary way to boost earnings, but the impact of those buybacks may begin to wane. In the fourth quarter of fiscal 2024 (ended September 28), Apple spent $25 billion on buybacks. But it happened at a time when Apple was valued near its highest point in five years.

AAPL PE Ratio data of YCharts

This makes share buybacks less efficient because the company has to pay a higher price to buy back its own stock. This reduces the program’s effect on the growth in earnings per share (EPS).

So with two of Apple’s primary ways to grow earnings potentially running out of steam, the conversation is turning back to revenue growth, which Apple has struggled with over the past few years.

Expectations for the 1st quarter are not high

Fiscal Q1 includes the holiday quarter, and it will be an important moment for Apple to see if its iPhones and Apple Intelligence made a difference to consumers. Apple is experiencing increasing competition from Android phone makers, and this could weigh on Apple’s results.

Wall Street analysts are not expecting much from Apple in Q1 as they expect sales growth of 3.9% and EPS growth of 7.8%. Investors can be very critical of Apple even if it posts results that everyone expects.

So should investors buy Apple stock before January 30? I would say no.

There isn’t much optimism surrounding Apple’s business right now, and even if it reports a blowout quarter, expectations are so high that Apple’s stock is unlikely to budge. It trades for 32 times forward earnings right now, which is usually a level reserved for a company growing earnings and revenue at least into the mid-teens.

Apple is nowhere near that, so there is a lot of risk and not a ton of reward left in the stock. There are many cheaper alternatives with better growth than Apple, and investors should invest their money in them before buying Apple stock.