Money manager: Three reasons NOT to buy Apple

“Not everyone loves Apple. Take Fort Pitt Capital’s Kim Caughey Forrest,” Christina Medici Scolaro reports for CNBC. “The portfolio manager and equity analyst says it’s a fantastic phone company, but her accolades stop there.”

“Forrest gave three reasons for her lukewarm analysis of Apple,” Scolaro reports. “First, Apple’s record-high stock prices reflect a willingness to believe that the tech giant can reinvent an entire product category every few years, Forrest said.”

“Second, Forrest said Apple will have a tough time shifting consumer tastes back to wrist-pieces when the Apple Watch launches in April,” Scolaro reports. “Forrest added: ‘I don’t really understand how they think they’re going to change behavior other than it’s cool and that’s about it.'”

MacDailyNews Take: “I don’t really understand.” A smart person would’ve stopped there, not appeared on CNBC.

“Lastly, Forrest questions the growth prospects of the iPhone, even after setting sales records with the iPhone 6 last year,” Scolaro reports. “Forrest is neutral on the stock and says she has to question the fact that people are buying the stock based on the notion that market share of iPhones is going to continue to grow. She said that gives her pause.”

Full article here.

MacDailyNews Take: Nobody with a least half a brain is buying AAPL “based on the notion that market share of iPhones is going to continue to grow.”

Apple understands that it’s not amassing market share that matters per se, it’s the demographics of the market share you’ve amassed that matters most.

With iPhone, as they will with Apple Watch, the company will continue to amass the vast majority of the best, most-desireable customers while leaving the dreck for the also-rans, just as they’ve done with personal computers, portable media players, and tablets.

Here’s a list of everything that Fort Pitt Capital’s Kim Caughey Forrest understands about Apple:
 
 
 
 
 

[Thanks to MacDailyNews Reader “Lynn Weiler” for the heads up.]

Related article:
Apple grabbed 93% of mobile industry profits in fourth quarter 2014 – February 9, 2015

31 Comments

    1. Yea right, Apple is losing market share. Just had two.clients order the new 5K iMac. Both were on back order 10 days. That tells me Apple is selling them as fast as they can make.

      Apple is one of the very few companies showing growth in computer sales. It would be foolish to ignore this category and underestimate the revenue potential this adds to Apple’s bottom line.

      I’ll say it again, Apple spends more on R&D than most other companies. Only Apple knows what they have up their sleeves, but something there is. All its competition can do is skim Apple’s IP and innovations or just blatantly steal it, i.e. Samsung, “Biggest rip off artists in the 21st century.”

    2. Read the article (yes she is stupid or selling hits) but I am totally impressed lately where commenters are showing they know more than the authors.

      “What’s troubling about her position is that she presents it as objective and practical. Yet she offers up vague, unveted data points as a cautionary tale.”

      More and more, I am seeing commenters getting it and speaking up. Whole new world. 🙂

  1. Are you f#cking sh#tting me? This person gets paid to give financial advice? here’s some advice: don’t poo poo a stock to your customers that performs like AAPL. They’ll figure out on their own that you’re a dumbass and you won’t be in the business long. Way to screen ’em Ft Pitt.

  2. This person is obviously one of those typical “analysts”… 😉

    > Forrest gave three reasons for her lukewarm analysis of Apple…

    First – Current AAPL price does NOT reflects “a willingness to believe that the tech giant can reinvent an entire product category every few years.” It reflects the potential of what Apple has already done or announced. The ongoing increase in AAPL price is what reflects speculation about future products that Apple has not yet made public.

    Second – Apple Watch is not trying to “shift” anything. That suggests that Apple wants customers to start buying Apple Watch instead of iPhone. That is nonsense and shows how little this “analyst” understands the situation. Apple Watch is an enhancement of the iPhone user experience. Apple Watch is not a separate stand-alone product that is meant to “change behavior” of customers. All potential Apple Watch customers are already iPhone customers; that’s an easy sale to an already friendly and enthusiastic audience (numbering in the hundreds of millions).

    Lastly – “…. she has to question the fact that people are buying the stock based on the notion that market share of iPhones is going to continue to grow.” That’s because people are NOT buying AAPL based solely on that notion. iPhone is certainly a big part of Apple’s success, but it is certainly not the only thing Apple sells (or will sell in the future). ALSO, it’s quite obvious that the overall market for smartphones is growing; more people are buying smartphones instead of lesser mobile phones. Therefore, even if Apple’s iPhone market SHARE does not grow, Apple sells more iPhones into a larger MARKET.

  3. Counter Arguements:

    1. Fresh new high on HUGE Volumne indicates heavy fund buying
    2. If Henry Ford asked folks what they wanted it would of been a faster horse …. People don’t know what they want
    3. Trend setter …. New pro its and ideas …. BEST of BREED

  4. Kim The Genius said, “First, Apple’s record-high stock prices reflect a willingness to believe that the tech giant can reinvent an entire product category every few years.”

    No, it doesn’t Kim. It’s actually a desperate attempt by Mr Market to keep up with Apple’s CURRENT business results. It has nothing to do with whatever the company may come up with in the future.

  5. “Forrest added: “I don’t really understand how they think they’re going to change behavior other than it’s cool and that’s about it.””

    didn’t they say that about the iMac?
    and the iPod?
    and the iPhone?
    and the iPod?

    or is there just an echo in my brain?

  6. Don’t listen to these guys. They probably are getting ready to SHORT massive amounts of APPLE stock by spreading these shit stories. Thats what financial institution do. But Apple Stock isn’t bulging.

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