“When it comes to investing, CNBC’s Jim Cramer maintains one key guideline: when the market gives you a chance to buy a high-quality stock, you must take advantage of it,” Elizabeth Gurdus reports for CNBC. “‘You literally have to take action right into the knee-jerk negativity to get the best buys, and that confuses a lot of people,’ the Mad Money host said.”
“To clarify the strategy, Cramer turned to the stock of Apple, one of his favorite long term investments. In September, Apple’s shares fell from $164 to $150 on worries that the new iPhone would not live up to expectations,” Gurdus reports. “But the stock has recently regained momentum, surging to $159 on Monday. In his search for a reason, Cramer kept hearing that nothing was ever really wrong with Apple, it had just run too much.”
“Some people also pointed the Mad Money host to a research note from Keybanc, which upgraded Apple’s shares to overweight from sector weight on the expectation that the $999 iPhone X would boost the company’s profits,” Gurdus reports. “‘Sure enough, when I got the upgrade, there wasn’t anything in therethat we didn’t already know: Apple’s got good pricing power on its phones, excellent app store growth [and an] ever-expanding service revenue stream,’ Cramer said. ‘So why did Apple’s stock roar higher then? My conclusion: it never should’ve been knocked down in the first place.'”
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Read more in the full article here.
MacDailyNews Take: Once again:
AAPL is like a buoy. Quick, it’s back on the surface! You there, analyst, and you, too, swim down and tug on the chain! Drag it under… lower, lower… Good! Now, quick, everybody jump on, and we’ll take a ride back up to the top again! — MacDailyNews Take, January 9, 2012
At the most basic level, it’s extremely simple: Pump, then dump. Foment, then buy. Rinse, lather, repeat as the SEC sleeps.