Apple Inc (AAPL)

A stock split would not impact the valuation in his opinion. It is an institutional darling and the top of its class.

Apple has gone parabolic, which suggests it’s vulnerable to a pullback. Usually see a runup into its fall event (September 10 this year), and then a selloff. Don’t get into it now, wait for tech seasonality in October.

(A Top Pick Aug 4/17, Up 45%) It is in his top 5. His model price is $243.96 or a 9.5% upside. Warren Buffet is buying a little more.

(A Top Pick Sep 20/17, Up 40%) He stuck with it. He thinks they are doing a lot of the right things. The subscription and services model has been a good model for them. There is an announcement coming in September which he thinks will be positive. They are returning money through buybacks and dividends.

He owned a lot of it after the recession, but now they have no unit growth. He's concerned about what would happen if unit volumes went negative. Product launches in September should benefit them, though. Also, they have a lot of runway to expand services (e.g. apps, streaming music).

Cash flow is incredible. Repatriated a ton of cash. Pretty fairly valued. Could continue to run up to $250-60. Happy to own at these levels. Still a good buy here.

The caller has a large profit in Apple and is considering selling half his position. Hurst commented that he loves the strategy of de-risking. Then he commented on the high quality of Apple’s performance. It is delivering in technological development, growth of revenue stream, stock buybacks, dividends, etc. He also thinks that the market has not yet appreciated the potential of Apple’s augmented reality technology, which is just in its infancy today. So, even though he would de-risk a position that had grown large because of a big profit, he would not exit Apple and sees strong reasons to continue to invest in it.

Covered call selling DEC 210 calls. First company to reach the trillion-dollar market cap. He really likes this company. They are kicking on all cylinders. A cash hoard that is staggering.

This is a great company but its business has evolved. Its penetration in developed markets is very high and so its sales are replacement cycle. In less-developed markets, the phone is so expensive that it is difficult to increase penetration. The company has a lot of cash, but it is not using it. In addition, the company has grown so quickly over the last few years that continuing the momentum will be a challenge. For someone who has owned this company for a while, he would recommend taking the cost basis off the table. He doesn’t expect this to have a huge correction, which is what he expects for Twitter, but he does expect Apple to become range-bound.

He puts it in the same boat as AMZN-Q. How long can it maintain that competitive dominance?

What will Apple do with their cash holdings? They will either grow the dividend, buy back shares, or they will continue on acquisitions and R&D. They will not likely do only one, but a combination of all three. A great stock to hold long term.

(A Top Pick July 11, 2017. Up 33%). He continues to love Apple. He sees a 17.5% upside.

(A Top Pick March 14/17 Up 37%). This hase been a rock star, with a name that continues to defy the critics. He does not own it presently and will expect to trade into it again soon.

(Past Top Pick, January 25, 2018, Up 8%) It's his longest-held position (since 2006). Valuation is 14x. It's becoming less dependent on the iPhone, and doesn't need to rely on its future growth as much now. At current levels, it's a little off its high. $170 is its 200-day average, so it would be a screaming buy at that level.

(A Top Pick August 4, 2017. Up 20%). His model price is $216 and Buffet apparently buys it every day. If he owned it now, he would certainly keep it.