Moody’s lifts Apple’s rating to ultra-elite status

On December 21st, Moody’s upgraded Apple to its highest “AAA” rating, a debt upgrade that comes on the heels of an equity upgrade by Bank of America.

Apple Park in Cupertino, California
Apple Park in Cupertino, California

Billy Duberstein for The Motley Fool:

After the upgrade, it is one of only three companies to enjoy that ultra-elite status, along with Microsoft and Johnson & Johnson.

The honor is quite a change from just five years ago, when Apple was regarded by many as nothing more than a cyclical device maker, rather than a sticky brand ecosystem with highly loyal customers and an emerging recurring-services division.

Of course, Warren Buffett (who also owns Moody’s stock, coincidentally) was smart enough to see Apple differently, and began buying the stock back in 2016, with a current split-adjusted average cost basis of $34.25, compared with a price around $178 today…

While the Moody’s upgrade reflects a better view of Apple’s safety profile, the company also received a positive note from equity analysts at Bank of America (another Warren Buffett holding!) on Dec. 14. Analyst Wamsi Mohan thinks Apple is in for a strong iPhone upgrade cycle in fiscal 2023, and he predicts it will also introduce a virtual reality headset that year as well.

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