Stockchase Opinions

Gerald Allaye-Chan Apple Inc AAPL-Q TOP PICK May 29, 2009

Excellent momentum. Sold 11 million iPods last quarter with 9 million as the estimate. Also sold 3.9 million iPhones with the estimate at 3.35 million.
$135.810

Stock price when the opinion was issued

electrical electronic
It's the ideal tool to help you make quicker, more informed decisions for managing and tracking your investments.

You might be interested:

TOP PICK

Global tech behemoth. His son always tells him that it's all about the ecosystem. That's what drives customer loyalty and recurring revenue. Innovation continues to drive earnings and customer loyalty. Services are where it's at on a go-forward basis. Apple Music is very high margin and recurring revenue, offsets sporadic cyclicality in hardware sales. 

AI initiatives offer good growth potential. Balance sheet is bigger than many countries combined. FCF generation very strong. Shareholder friendly initiatives. Sees 15% earnings growth going forward. High, high quality for long-term investors. Yield is 0.4%.

(Analysts’ price target is $250.59)
TRADE

They generate $110 billion in free cash from services to buy back shares. Eventually they will get AI right. He trades this like crazy. Very positive.

BUY

Will be fine, if they could work with other companies to build AI into their products. Does it matter to earnings if they aren't the first out of the gate with applying AI? Not really. What matters is they make the best version of whatever anyone has made in the past three years. 

BUY

It leads the Mag 7 this week. The quarter was fine. In response to tariffs, they are moving some supply chains to Indonesia and Indian, away from China. Chinese phones are taking market share, but we've gotten past this news. Apple services were +14% this quarter and beat the top and bottom with an 8% growth rate. He will ride it up.

PARTIAL SELL
Partially sell a 70% gain, making up 30% of a RRIF?

30% is too high, even the greatest stock of all time. Don't sell all of it, but gradually sell it down to 5% weight.

BUY

They will spend over $500 billion in the US in the next 4 years to manufacture in the US. Have faith in CEO Tim Cook, given his track record.

BUY
Which Mag 7's will weather current market adversity?

The ones that are nice to King Trump. He'd hope that TSLA and AAPL would escape additional tariffs on China. 

Except for TSLA, the other Mag 6 have come down to very reasonable valuations. For example, AMZN's trading at a discount to WMT, which makes no sense. GOOG is trading at 19x earnings. Thinks AAPL growth will be double digit. This is your chance to buy quality companies at reasonable valuations. See his Top Picks.

HOLD
AAPL vs. AMZN

Down 19% from recent highs. PEG ratio is 2x. Discounted due to concerns over momentum in China, but he thinks that's overplayed. If he had to choose today, he'd choose AMZN because it's a bit cheaper.

premium

This is a Panic-proof Portfolio opinion which is available only for Premium members

Curated by Michael O'Reilly since 2020.
1550+ opinions with 4.81 rating (one of the best performing expert).

PAST TOP PICK
(A Top Pick Apr 09/24, Up 25.1%)Stockchase Research Editor: Michael O’Reilly

Our PAST TOP PICK with AAPL has triggered its stop at $212.  To remain disciplined we recommend covering the position at this time.  When combined with our previous guidance, this will result in a net investment gain of 25%.

BUY

Bears don't like Apple here. Now trades at 30x PE. But Apple has 1.3 billion users. They will have a foldable phone next year.