Apple Inc. (AAPL) reported third quarter fiscal 2021 earnings last night. And they were incredible. I'll give you a rundown of the highlights and then give a near-term outlook.

Two weeks ago, I wrote how I was expecting more upside for Apple heading into earnings. Let's see how things shook out.

Key Takeaways

  • Apple reported stunning earnings last night.
  • Leading up to earnings, the stock was seeing Big Money buying.
  • Strong fundamentals and momentum in the stock keep the long-term narrative intact: up.

Apple reported a June quarter record revenue of $81.4 billion. That was up 36% year over year and easily beat consensus estimates of roughly $73 billion. iPhone revenues alone rose nearly 50% to over $39.5 billion.

The tech giant also reported diluted earnings per share of $1.30 for the quarter. Compare that to consensus estimates of $1.01, and you get an idea of how big this beat was.

Let's be honest: for a company with a $2.45 trillion market cap, this is incredible growth. And while these numbers are eye-popping, let's check in on how the stock has been trading leading up to this report.

I focus a lot on how a stock trades. Oftentimes, it can clue you into the fundamental trend. Apple's stock has been cranking in 2021 with a performance just shy of 11%. And most of that gain came over the past month, with shares ramping 8.9% in that time frame.

This brings me to my favorite indicator for a stock, Big Money activity. Apple shares saw six Big Money buy signals in July leading up to this report. All that means is that there was unusual trading in the shares, which could be institutional buying.

And while I look at a lot of proprietary gauges for a stock, below I'll show you the times my system flagged those Big Money signals. Typically, an investor wants to be on the same side as where the money is rushing … at least in the near term.

Below, you can see in the chart where Apple's stock traded in an unusual way. Lots of shares traded as the stock increased in price. Additionally, you can see how the accumulation indicator lines up with that narrative.

Share price performance of Apple Inc. (AAPL)

So, the million-dollar question is what's in store for Apple going forward. Based on the beat in earnings and the momentum in the stock, the long-term outlook is rosy.

But keep in mind that we're in the middle of summer, which means market liquidity is low … making volatility higher than usual. Shares will likely bounce around as traders digest earnings season.

Once the near-term jitters are out of the way, though, I expect that more new highs will be in store for this tech behemoth. There's a reason Apple is the largest company on planet earth: it has amazing products, a trend of crushing earnings, and it's a Big Money magnet.

The Bottom Line

Apple released a stunning earnings report. Leading up to it, shares were ramping higher with Big Money activity. This author believes that the long-term narrative for the stock is similar to trends of years past: up.

Disclosure: The author holds no position in AAPL at the time of publication.