Read this before you even think of selling your Apple Inc. shares

“With Apple stock trading a whopping 67% higher than it was 12 months ago and management gearing up to report second-quarter earnings next Monday, some investors might be tempted to sell shares and take their gains,” Daniel Sparks writes for The Motley Fool. “But shareholders should think carefully before they do so. While it might be difficult to comprehend how a company with a market capitalization over $730 billion could still be undervalued, there are concrete reasons to hold on to this winner for the long haul.”

“While Apple’s capital return program expires later this year, in the company’s first-quarter earnings CEO Tim Cook said Apple would announce an update to the program when it reports second-quarter results,” Sparks writes. “Indeed, Apple’s updated capital return program could be at least as aggressive as its predecessor.”

“Since Apple began paying dividends, the tech giant has increased its payout two times, by about 15% in 2013 and by 8% in 2014,” Sparks writes. “Apple can easily afford to continue to increase its dividend by 8% annually. But with shares trading significantly higher in 2015 than they did in 2013 and 2014, stock repurchases are less enticing and management might opt to be more aggressive with its dividend increase in 2015 than it was last year.”

Read more in the full article here.

21 Comments

  1. Not one bit of original information or analysis. Motley Fool “articles” are just long advertisements for their paid services. There is enough advertising on MDN without linking to more of it.

  2. I sold some in Oct. 2014 after holding a MIGHTY long time and kind of regretted it after about a month (but I’d warned myself that might happen). But there’s a significant amount left and I’ll be sitting on those for a while longer.

  3. Take your gains if you need them, otherwise hold your Apple shares. It doesn’t take a genius to see that much. Any analyst that tells you to sell Apple shares based on how high they’ve gone over the past year is just being a jackass. You’re still going to be getting your dividends. I don’t focus on the stock as much as I focus on what the company is doing. If Apple’s share price falls off, then so be it.

    Apple is arbitrarily valued by Wall Street. Even today, Microsoft carries a higher P/E than Apple which makes little sense. I’d hardly think Microsoft is firing on all cylinders, so what’s the higher premium for. I hope they’re not valuing Microsoft on high Windows 10 sales. There’s no guarantee that’s going to happen. AppleWatch has just as much of a chance of being a hit than Windows 10. At least AppleWatch cash is already starting to trickle in whereas Windows 10 cash might not come in for another year.

    1. Apple’s Watch business will be bigger than all of Microsoft in a few years. All Microsoft has going for it these days are a video game console which people like but which doesn’t make any significant money, a financially lucrative business selling operating systems and productivity software for a type of computer that is in decline, and patent trolling for Android royalties.

  4. Motley Fool is creepy, and MDN is a party to that.

    When I’ve visited the Motley site after a link like this, I’ve seen the story for what it was, and decided to close the page. Suddenly, there was an official-looking Safari message box with the question/warning, ‘DO YOU REALLY WANT TO CLOSE THIS PAGE AND THIS MOTLEY FOOL ARTICLE?”

    The reader then had to choose one of the two buttons, and that was when I decided on neither and force-closed Safari. Nobody else I visit does that.

    Oh, got enough ads on the page, MDN?

  5. Last June 9 Apple Inc split its shares 7 for 1, each holding a value of 92.22 (+/-). In the following 10 months our broker (not to mention every one of my closest friends) advised us to grab our phenomenal gains (from 1.77 per share over the years) and SELL, SELL, SELL!

    Yeah, right. As of today’s close, we have realized a 37.6% gain in our AAPL shares from last summer alone, a figure nothing else in our portfolio comes close to touching. We are sick and tired of everybody on earth knowing more about AAPL and its parent company than we do. So, that said, we’re crying all the way to the bank. Screw analysts, all of them, amateur and professional! Do your research, buy, hold, and believe!

  6. Annual S&P 500 EPS growth: 2.1%. AAPL EPS growth: 28.9%. My calculations for the June quarter: Revenue up year over year 39.7% and EPS up year over year by 55%. Why is market PE >20 and AAPL around 17? Getting frustrated by the BS…

  7. Most articles about Apple are to get you to sell your stock. Most everyone wants to buy the stock but if they can get it cheaper they write a great article why all their ideas and products will fail. Can’t remember an article praising anything made by Apple.

  8. We all know AAPL is undervalued. The question we would like to know is whether the market is going to send the stock up or down.

    It really could go either way. Apple Watch sales may surprise and help push the stock up. On the other hand the brokers may be primed to shot the stock down for a bit.

    It was interesting to see that the rumor of an Apple Car had a greater effect on increasing the stock price than all the stellar results and potential of the Apple Watch.

    FWIW I sold a 1/4 of my stock when it reached $130. Panicked when it went up to $133 and then 5 days later bought back in at $126. Gained another 5 shares but a risky game to play.

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