“A little over a month ago, I sold half of my Apple shares,” Michael Henage writes for Seeking Alpha. “I started acquiring shares in 2013 at about $60 per share. In the spirit of full disclosure, I sold at about $155, which isn’t far from where the stock trades today. With an annual return of nearly 17% not including dividends, I’ve been pleased with Apple’s performance.”
“I sold my shares because quite honestly, I couldn’t get comfortable with the fact that Apple wouldn’t be reporting unit sales figures going forward. When a company stops reporting a key metric that investors and analysts have come to rely on, it’s rarely a sign of positive future results,” Henage writes. “However, there are a few details that have come out over the last few weeks that are making me rethink my position.”
MacDailyNews Take: That’s how a normal company should be perceived. Apple is not a normal company. Apple is rare. When they do something like stopping the reporting of unit sales, it’s not to hide something, it’s to illuminate something else.
“With investors on edge, the shares may or may not have hit bottom,” Henage writes. “However, there are a few reasons to believe the long-term bull thesis behind the company is damaged yet not completely broken.”
MacDailyNews Take: When Apple warned, they said revenue for the quarter would come in at $84 billion. Right there are 84 billion reasons why the company is nowhere near “completely broken.” Revenue of $84 billion in a single quarter! Apple is “damaged” only in the eyes of investors who cannot see the forest for the trees.
“Apple made it very clear that weakness in China was responsible for all of the slowdown in iPhone revenue and then some. Last quarter, sales in China represented over 18% of the company’s overall revenue. It’s a near certainty that the weakness in China is a short-term issue. I don’t know of one credible source that would suggest that China will decline over the long-term,” Henage writes. “With shares selling at roughly 13 times 2019 estimates and paying a yield of just under 2%, investors don’t need blind faith to see that it may be time to buy Apple shares again.”
Read more in the full article here.
MacDailyNews Take: Someday, Apple investors will look back on this period that Apple’s stock price is currently enduring and laugh while they count their money!
Be fearful when others are greedy and greedy when others are fearful. — Warren Buffett