Apple Shares — An Apple a day
09 February, 2015
Forget the debate over whether iPhones are better than androids - that argument will continue for years. The real debate is whether there will ever be a time when selling your Apple shares makes sense. There have been so many potential catalysts to end Apple's dream run - the death of Steve Jobs, the plateauing of iPad sales, the increasing popularity of Samsung products, criticism over Apple's pricing, the security breach targeting celebrities, and the bendy iPhone 6 - but the company and its shares keep performing. The analyst who in 2013 said "Apple is not a viable business model: it is, like Jobs, an unrepeatable corporate freak show" must want to eat his words.
Apple Inc's latest quarterly results surpassed even the most optimistic expectations. The company reported record-breaking earnings of US$18 billion for the three months to December 2014, on revenue of US$74.6 billion. Analysts had expected Apple to achieve revenue of US$67.69 billion, and many were skeptical the company would get there. The company's performance was especially impressive in China, where it was the top smartphone seller during the quarter, with revenue from greater China, which includes Taiwan and Hong Kong, rising 70% during the quarter, to $16.1 billion. That means that the region is close to overtaking Europe as Apple's second-biggest market.
For a successful company that already has a significant market share to achieve increased sales, at a higher price and with a larger profit margin on those sales is seriously impressive. Many companies would kill to have Apple's commercial footprint - 74.5m iPhones sold in three months, which equates to more than 34,000 phones an hour, 567 per minute or 9.4 units a second!
The Apple share price has rallied 40% in the past year and lifted a further 7% after the result. You'd think that some investors would want to take some money off the table after its incredible run. But a quick Google search of "Buy Apple shares" yielded 104 million results versus just 50 million for "Sell Apple shares". And most of the Sell Apple results were from a few years back. This company and stock seem, at least for the moment, to be able to keep on keeping on.
For those of you wanting a small piece (or should that be slice) of the Apple, we have an exposure to the company through our Investment Series range. Do contact us if you would like to know more.