Some Perspective on AAPL

By Tim Knight

It wouldn’t take a person long this morning to see what the big news was:

 

I have no position in AAPL, but since it’s one of the largest companies on the planet (and, until recently losing FOUR HUNDRED BILLION in market cap, the most valuable) it’s certainly worth a look-in.

Below is Apple’s performance since its IPO in December 1980. Apple was actually a fairly middling stock for almost the first quarter century of its existence. For many years, it was an outright dog. The ‘sweet spot’ was from 2003 to 2012, when it pretty much went vertical. There was a new inflection point about six years ago when the ascendency went a little less crazy.


performance since the IPO in 1980

It’s this most recent chunk of time that is the most salient. AAPL channels remarkably well, as you can see. And, dreadful as the performance has been in recent months, if a person actually wanted to own some AAPL, it seems like a fairly opportune time to do so. Of course, this channel will ultimately be broken, but the fact is that, relative to this channel, AAPL is getting near bargain-priced at this point.


exceptional channel

There are going to be a couple of deciding factors this month which dictate whether (a) AAPL is indeed “on sale” right now or (b) that channel fails and AAPL starts going the way of Sun Microsystems: those factors are, first, the China trade talks, and second, the earnings announcement for the quarter after the close on the 29th.

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Gary

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