
NASDAQ:AAPL
Sell Amazon and Apple now? The stock has stagnated the past two years, but it makes more money. Apple keeps investing in near projects, which is a good sign. Hold onto both of them for the long haul. He owns a lot of each.
Apple reported after the bell and overall it was a beat--he's happy. They beat earnings by 8 cents a share; revenues beat; and their revenue projections for the next quarter are surprisingly bullish. What impressed him most was how the non-iPhone revenues are growing, namely services. Services are annuity revenue, keep giving. 10 years ago, people wrote off Microsft, but they missed the story. MSFT transformed itself into a utility--you have to pay MSFT each year for the service. Same with Apple which is now making money in services. Also, their wearables division is exploding, says their CEO. He's happy with their report today. And their iPhones in 2020 will be 5G-equipped, which will encourage customers to upgrade. The only cloud on the horizon is Trump.
(A Top Pick Jun 05/18, Down 7%) Slowing iPhone sales and there are concerns over consumer privacy with their products, but way safer than Facebook. He likes their cash holding and the dividend they pay. The membership service business is growing as well. He would buy on weakness.
It is so ingrained in the consumer that is not going away. They have a massive amount of cash. The cash on their balance sheet is bigger than 25 countries’ GDP. Not expensive valuation if you take out the cash. You have to watch if they get too big and they can't grow. They are not there yet. Maybe in 10 years.