After rising to an all-time high of nearly $138 in September, shares of Apple (AAPL 2.86%) have pulled back a bit. The stock is now trading close to $120 -- 13% lower.  

Not only is Apple down from its all-time high, but the company has a fresh lineup of new products and even some new services that are about to launch. Is this a good time for investors to get in on the tech stock?

iPhone 12 Pro and iPhone 12 Pro Max.

iPhone 12 Pro and iPhone 12 Pro Max. Image source: Apple.

Strong business momentum

While we don't know yet how well Apple performed in its recently ended fiscal fourth quarter since the tech company hasn't reported earnings for the period yet, we do know that Apple's momentum in the prior quarter was exceptional.

Even amid the challenges brought on by the coronavirus, Apple's fiscal third-quarter revenue jumped 11% year over year and earnings per share rose 18%. Additionally, the company saw growth in every one of its product segments during the period. 

Services -- Apple's second-largest segment after iPhone -- continues to be a major catalyst for the company. Total services revenue in fiscal Q3 increased 15% year over year.

"We had strong performance in our digital services with all-time revenue records in the App Store, Apple Music, video, and cloud," said Apple CEO Tim Cook in the company's fiscal third-quarter earnings call.

Looking ahead, Apple has two more services it's about to launch to further bolster the lucrative segment. Apple Fitness+, a Peloton-like virtual fitness service, launches late this year. Further, a bundled offering of Apple's native services (including Apple TV+, Apple Music, iCloud, and more) called Apple One is launching sometime this fall. 

Apple Fitness+ displayed on an iPhone and Apple Watch.

Apple Fitness+. Image source: Apple.

Then there's all the new hardware Apple has launched recently and will continue to launch in the coming weeks. In September, Apple refreshed its Apple Watch, iPad, and iPad Air. Then, in an October event, Apple announced a new smart speaker, the iPhone 12, the iPhone 12 Pro, and the iPhone 12 Pro Max. These new products should help Apple's important hardware business keep growing nicely.

A pricey valuation

Though Apple stock is down about 13% from its all-time high, the tech company's valuation is still quite pricey. Apple has a price-to-earnings ratio of 37. This valuation metric looks more reasonable when compared to earnings estimates for next year. Apple currently trades at about 32 times analysts' average forecast for next year's earnings.

But this is still a hefty premium to pay for a company growing at Apple's rate. Analysts, on average, expect Apple's earnings per share to compound at an average annual rate of about 13% over the next five years -- impressive but not stellar when viewed next to the stock's current valuation. Simply put: The stock isn't trading at a meaningful discount today.

On the other hand, high-quality market leaders rarely trade at levels that make them look like a steal.

So, is Apple stock a buy, sell, or hold? I'd say it's a buy, albeit in moderation.

In light of Apple's long history of innovation and customer loyalty, shares of this top-notch tech company may still be worth buying at this valuation -- as long as the stock is a small portion of your portfolio. There is simply too little margin of safety for things to go wrong to make Apple stock a big position. Further, with a pricey valuation like this, Apple investors should be willing to endure lots of volatility in the coming years.