Prediction: This Is What a $1,000 Investment in Apple Will Be Worth by 2030

Apple (NASDAQ: AAPL) has been a difficult company for investors to evaluate recently, in part because it trailed the S&P 500 in two of the past four years, largely due to concerns that it was missing out on the artificial intelligence boom.

But some of those concerns have subsided, and Apple's shares are now up 113% over the past four years, compared to the S&P 500's 95% gain.

So, where is Apple stock headed by 2030, and can it continue outpacing the market?

Image source: The Motley Fool.

Apple stock could continue rising, though more modestly

There's no way to know for certain what Apple's share price will be in 2030, but a look at its historical returns can tell us how much better it has performed than the S&P 500.

For example, over the past 15 years, Apple shares have delivered annualized returns of about 25% compared with the S&P 500's annualized returns of about 14% (including dividend reinvestment in both figures).

There's no guarantee it will keep delivering similar levels of long-term returns, of course. But given the current expansion of the AI market, Apple's strong position in consumer tech hardware and services, and the company's high-margin business, I think it is well positioned to continue beating the market.

Over the past four years, Apple's annualized total returns of over 15% were only slightly ahead of the S&P 500's 13.5% returns.

If I had to guess, I'd say the stock will have even lower annualized returns over the next four years -- perhaps about 12% -- than it did over the previous four. If that happens, a $1,000 investment made in Apple stock today would grow into a position worth about $1,464 in September 2030.

This assumes the company continues to increase its revenue at its current pace, and benefits from its expanding services business, its new Siri AI, and an expanding iPhone lineup that includes the new iPhone Duo.

That forecast also assumes that geopolitical instability, rising U.S. debt, higher interest rates, and concerns about rogue artificial intelligence could cause volatility in Apple stock and the broader market over the next few years.

Why it's worth buying Apple right now

While it's impossible to know where Apple stock will be in four years, the company's track record of success and current trajectory should give you confidence that it's worth owning.

Apple had about $117 billion in operating cash flow over the past nine months, giving the company plenty of funds to make acquisitions or invest in product development. And even though its margins are under some short-term pressure, the company estimates that its current-quarter gross margin will be about 48%. All of this suggests that Apple will remain highly profitable over the coming years.

At a time when its competitors are spending heavily on AI infrastructure -- with projections for the six largest hyperscalers to lay out $1.3 trillion in capex next year -- Apple is not investing in either developing the latest AI model or building enormous data centers. Instead, it's banking on consumers wanting to buy its high-end devices to access its AI agents.

If history is any indicator, betting on Apple's success will prove to be a wise move for investors.

Chris Neiger has positions in Apple. The Motley Fool has positions in and recommends Apple. The Motley Fool has a disclosure policy.