One, I bought Apple stock and AAPL has treated me well. Two, I buy most of whatever my father buys from Wall Street. He’s from Scotland and knows his way around a penny, has a good nose for what goes up, and the good sense to take profits and move on to greener pastures. He started to sell some Apple winnings, and, well, you know; like father, like daughter.
What Goes Up
The original Mac of the MacKenzie family subscribes to the basic theory of stock evolution. What goes up, must come down. That means stocks do well for awhile, but not forever. And Apple’s stock has done very well recently.
Daddy’s view of Apple is simple. The company appears well run, has a diverse and profitable product line, and the future looks good.
But he also notes that Apple’s biggest trick is the iPhone’s stellar performance since 2007, the one instigator of AAPL’s stock market success, and even with a steady stream of cool gadgets in the pipeline, well, what goes up, must come down. The Watch won’t sell anywhere near iPhone numbers and once word gets out that’s it’s not the next iPhone product, that could have a short term impact on AAPL, which, though, may present another buying opportunity.
Anyway, that’s the common perspective among the MacKenzie family investors, hence, a chunk of profits from AAPL are being moved elsewhere; ipso facto, we’re selling some AAPL.
Where Apple and AAPL could surprise market analysts, stock market gurus, and the technorati elite is with a product pipeline that surprises positively. An Apple Watch that sells in numbers approaching the iPad would help. So would a full on attack of the cable television industry by Apple TV.
An Apple car might tantalize the market, but not many companies make as much money manufacturing and selling cars and parts as Apple does just selling the Mac, let alone all the other profitable business segments that bring billions in cash to the company each quarter.
Wall Street seems irrational at times, throwing caution to the wind on one trick pony businesses like Google, throwing money down a sinkhole called Amazon, while not rewarding as much those few companies that grow and are profitable at the same time. That’s Apple.
Daddy also says that the best and fastest way to make a small fortune buying into Wall Street’s herd mentality is to start with a large fortune. Personally, I think he’s selling a bit of AAPL because he like to count his winnings.