3 Reasons Apple's Still a Buy Today

Despite Apple's stock decline, Andrew Tonner thinks there's still a lot to love about the company. In this video, Andrew points out three specific things he thinks will drive Apple higher in the future.

  • The dividend yield is currently 2.5% and will probably grow, given Apple's cash hoard of $137 billion.
  • Apple will roll out its iPhone 5S and probably a low-cost iPhone to help penetrate emerging markets.
  • It could also release a new product such as the iTV or iWatch this year or in 2014, either of which would stand to deliver substantial earnings.

Apple may be taking its lumps today, but Andrew thinks things could turn around nicely by this time next year. Check out the video for more details.

 

There's no doubt that Apple is at the center of technology's largest revolution ever and that longtime shareholders have been handsomely rewarded, with more than 1,000% gains. However, there is a debate raging as to whether Apple remains a buy. The Motley Fool's senior technology analyst and managing bureau chief, Eric Bleeker, is prepared to fill you in on both reasons to buy and reasons to sell Apple and what opportunities are left for the company (and your portfolio) going forward. To get instant access to his latest thinking on Apple, simply click here now.


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  • Report this Comment On April 14, 2013, at 10:59 AM, TangoXray7 wrote:

    Andrew, the problem with Apple is that their technology is now built out. Unless they uncover a large new market (and low end phones in third world countries aren't going to be it) or reveal a significantly new product they're going the way of Microsoft, General Electric, cisco, Texas Instruments, Hewlett-Packard, etc. They become evolutionary rather than revolutionary tech companies and they get boring. Their price comes down until their P/E starts shouting "Value Stock!" and people buy them for their dividends. The stock price has a long way to fall before that happens.

    iTV, even if it ships, will not be a revolutionary technology. Folks that want an Apple based media center have been able to buy one for at least 6 years (I own one for example). If we take a lesson from existing consumer A/V products we see that the market favors specialized components rather than integrated solutions. People like to be able to upgrade their TV without upgrading their computer. That's why I'd say the market for iTV, which I expect is a flat screen with a Mac in it, will be limited.

    I just don't see Apple coming up with something like OSX again soon and unless they do, the party's over.

  • Report this Comment On April 14, 2013, at 11:24 AM, 1ponder wrote:

    I think AAPL is already a good value play. Current level of earnings should be more or less sustainable due to brand and loyal base while almost any valuation multiple you can derive is substantially lower than S&P. The benchmark is not AAPL yesterday or Samsung, but investment alternatives. AAPL has lost half its value relative to the S&P in just over six months, yet technologists are still piling on.

  • Report this Comment On April 14, 2013, at 12:15 PM, DeWinter21 wrote:

    It's funny to me how I know so many people who don't even know how to stream movies. Reminds me of years ago when no one I knew had an mp3 player until Ipod. I truly think one of the reasons Apple didn't prop up the stock price is because they have something game changing coming along. Again, perhaps not entirely new, but something to get the technophobes on board. Satellite and cable subscriptions are going down. Young people don't come home and just switch on a television. They decide what they want to watch via computer or streaming.

    But I was very wrong with the stock price all fall, thinking $600 was the new low!

  • Report this Comment On April 18, 2013, at 2:53 AM, Orcarr wrote:

    I don't agree. Apple is becoming another Microsoft.

    Years ago I bought an iPhone and it was the ONLY phone able to do a lot of stuff.

    I bought several MB Pro, 2 Apple TV, an iMac, another 2 iPhones, an iPad...

    But the last time I bought something from Apple was OSX Lion in 2011. After that, I uninstalled it and got my money back. Since then I moved from iTunes to Plex Media Server under Linux, from ATV to Raspberry Pi, from iPhone to Samsung Galaxy2. I still have my 2007 iMac for the Adobe suite, but Mountain Lios is so crappy that once my iMac dies I will move back to Linux for everything except Adobe (which I will run on Windows).

    Apple products used to be revolutionary. In 2012 Apple promoted Mountain Lion as the "most advanced OS" that included new features like... SAVE AS.

    Embarrassing.

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