“As the leaves turned this fall… Apple investors went from mania to panic. The stock plunged from its all-time high north of $230 per share to under $150,” Logan Kane writes for Seeking Alpha. “Meanwhile, the company booked billions of dollars in profit and record EPS.”
“Now, the stock has recovered off its lows and is headed up again, with optimism around the trade war and an earnings report that honestly wasn’t negative. Apple investors have been there before,” Kane writes. “For multiple times in the past 10-15 years, the stock has plunged to 10-11 times earnings amid rampant sell-side analyst and mainstream media negativity. I think that Apple investors should keep calm and hold onto the stock.”
“Apple is a highly cyclical stock, and there is endless money to be made trading cyclical stocks with good fundamentals. There is also the potential to get scared and sell your shares in Apple every time the media thinks it can’t delive,” Kane writes. “Apple is cheap. The company has levers it can pull to boost demand for the phones and maximize revenue. Wall Street isn’t giving credit for it yet, but it will. Apple’s low valuation is a reflection of volatility in the stock and not entirely of the risk of permanently losing one’s investment. Apple shareholders should take a page out of Journey’s playbook and ‘don’t stop believin.'”
Read more in the full article here.