You can clearly see the difference in the stock price
performances of leading technology players Apple ($AAPL), Microsoft ($MSFT) and
Google ($GOOG) since the lows they made when the markets bottomed back in march
2009. Apple has definitely outperformed in a dramatic way. Apple was up nearly 700% when
it was trading above $700, while Microsoft managed to double itself and Google
moved as high as 140% from 2009 lows. At present, all the three stocks have given
away some gains in the recent market fall. Take a look at the chart before I
once again boggle your heads.
Apple shares have seen a crazy re-rating in the past four years. And guess what, investors are still hoping it to cross $1000 by 2013 end. Isn't that too much to ask after such a stellar run? Why not look at Google and Microsoft as long term stock picks over Apple?
Usually, retail investors are sucked in when punters leave a
stock after pumping it hard, and then they keep complaining that this market is
being manipulated. This may well be the case with Apple once it enters a bear
market by breaching below $500. We saw a similar rise in Microsoft shares back
in late 90's and the stock is still trading at half of the highs posted in the year
2000.
Recently, I have been writing bearish forecasts on Apple,
and as expected I am still getting very harsh responses in my mail box every
day. Well, that doesn't bother me as I have learned from my silly mistakes and
won’t repeat them no-matter how lucrative trades keep popping on my screen. (This time kindly use the comments section to express your rage :)
Why Apple might fall
to $300 in next few years?
In a recent post I had made a forecast of $300 on Apple, and that’s
a 2-5 year target on this stock. Right now, it has just started to get
volatile, and from my experience I know what will happen next. People keep
telling me to look at the size of the company. I know it getting too big to
fail, but many other companies have grown that big in the past and we all know
what follows next. Do have a look at how Microsoft traded after it topped-out
in the year 2000. Apple might find a similar range for it and I expect $300 to
be the lower end of that range.
Also Read:
I won't be too harsh on Apple, $300 is just way too much. Rather, I would trim positions on apple and maybe look at Google and Microsoft as you have rightly pointed that they are undervalued. I don't share the view with the rest of the crowd that Apple is undervalued, but I don't think it will fall that much :)
ReplyDeleteGoogle is a sure shot long term bet, while Apple is being manipulated for sucking retail investors money. No idea what will happen to Microsoft in the long run. Windows 8 might take it to fresh 52 week highs in near term.
ReplyDelete