Apple Stock Is Doing Something It Hasn't Done Since 2022. Should You Buy or Run?

Apple (NASDAQ: AAPL) has been one of the most reliable winners in the stock market for a generation. The iPhone, which debuted in 2007, was a revolutionary product, offering a touchscreen and intuitive design that made products made by BlackBerry, Nokia, and Motorola seem obsolete.

How good has Apple been? Had you invested a mere $1,000 in Apple stock at the beginning of 2007 and ridden the wave of the iPhone's dominance, you'd be sitting on a nest egg of more than $82,000.

Image source: Getty Images.

But so far this year, Apple stock is trading down nearly 9% as it and other tech stocks pull back. It's a rare sight for Apple to be in the red; Apple has posted a yearly loss only four times since the debut of the iPhone, with the most recent loss in 2022. So, should investors be concerned about Apple now?

If you've got a long-term horizon, the answer is "no." In fact, now may be the best time to add Apple to your portfolio and profit from the inevitable bounce.

What happens when Apple falls?

First, let's take a closer look at the years when Apple's stock price fell (2008, 2015, 2018, and 2022), and what happened the next year.

Data source: YCharts. *Price shown is the split-adjusted price after stock splits in 2014 and 2020.

Yes, Apple's had a few bad years. The worst in the last 20 years was part of the global financial crisis that enveloped the entire market in 2008. But Apple did a great job of bouncing back, recording a huge 146.9% gain the following year.

I actually thought the 2022 drop was more troublesome, as Apple stock slipped because the company's revenue flattened and raised a lot of red flags with investors. But even then, Apple was able to more than make up for the drop with an even stronger 2023 performance.

What's the lesson here? If you bail out of Apple at the first sign of trouble, you miss the opportunity to profit. Seeing Apple stock today down 9% for the year and 13.3% from its all-time high means that the stock's on sale -- if you have the time to put it in your portfolio and let time work its magic.

Why Apple should bounce back

Remember that 2022 dip when Apple's revenue flattened out? That's not the case today. Apple is doing great and is projecting huge gains on the top and bottom line. Revenue for the first quarter of fiscal 2026 (ending Dec. 27, 2025) was $143.8 billion, up 16% from the previous year. Diluted earnings per share were $2.84, which was up 19% from a year ago.

The iPhone continues to be a big seller, but Apple is also seeing gains from its iPad and its Services segment, which includes Apple's App Store and Apple Music. Overall, the company has 2.5 billion active devices in use by customers.

Data source: Apple.

Apple ended the quarter with $45.3 billion in cash and cash equivalents, up from $30.3 billion a year ago. The company reported $54 billion in operating cash flow, and returned nearly $32 billion to shareholders through dividends and stock repurchases. It issued guidance for the second quarter for revenue to continue to grow at a rate of 13% to 16%.

The company is continuing to roll out new products, including the iPhone 17e and several new versions of its MacBook computer. It also appears on target to roll out the iPhone 18 in September.

Overall, I'm not worried about Apple's short-term drop. I see it more as a reflection of the market's short-term concern for tech stocks in general rather than an indictment of the company itself. If you've been considering a position, this is no time to run in the opposite direction. Apple stock is a buy.

Patrick Sanders has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple and is short shares of Apple. The Motley Fool recommends BlackBerry. The Motley Fool has a disclosure policy.