Apple stock outstrips most techs
Most technology stocks have taken their lumps over the past several months as a part of the larger economic downturn. Apple is bucking this negative trend and is performing very well indeed.
In a market that has seen the Dow lose thousands of points, and some major companies require bailouts or go bust, there are a few bright lights. In the technology sector, one of the brightest lights of all is Apple, Inc. According to Matthew Shannon of SeekingAlpha this might the right time to buy not just Apple hardware, but Apple stock as well.
Shannon says that Apple is doing a number of things right, despite a few negatives, and on balance the company seems to be in excellent financial shape. There have been rumors about CEO Steve Jobs, though nothing has come to pass and he is seen largely as a figurehead anyway. Still, the health rumors have lowered stock prices. The sale of desktop workstations are down, but that is true of almost all computer manufacturers in terms of non-business sales. Finally, lowered consumer spending often means lower sales of high-end goods, like Apple products.
Looking on the bright side, though, we see a company that is selling more high-priced laptops now than they were a year ago, probably more than making up for weaker desktop sales. The Apple customer base is very loyal. Many consumers of computers and electronics move up to Apple products; very few of them ever leave the fold. Apple’s computer sales are based on it’s excellent operating system, OS X, as much as on their excellent design skills and hardware, so they are not competing with everyone for the reduced-dollar Windows dollar. Finally, Apple offers a wide variety of very popular products, from MacBooks to iPhones to iPods. Therefore, they have a very wide revenue base.
When added to the tendency for technology sector stocks to recover more quickly than most coming out of a recession, the current situation might be ideal. Apple stock is undervalued when measured against sales and most of the signs say that sales will either stay stead or rise. With any money you have left over from getting your kids new iPhones and iPods for Christmas, you might want to consider some Apple stock for yourself.
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