Post MWSF: Buy AAPL?

[matix]

Hey all.

I've got some money ($2500) and am wondering if buying apple stock is a good idea right now. I am not a professional investor of course, but is anyone able to recommend doing this? I'd like to invest in my favorite company if it's a good idea.

BTW, I am a student, and 20 years old if that makes any difference in your advice.

 

[Zeke]

I bought some before the expo and it went up 20% in 2 weeks. It's as high as it's ever been right now but I think it'll probably keep going up with everything people are expecting from them this year. Just remember, if you have confidence in Apple then just buy as you're expecting them to do well and the stock price should reflect that. I'm expecting this to be a high growth year from Apple with the new computer lineup. Just my $0.02. Good luck.

Edited for addition: As for being 20 and a student. You can afford higher risk investments (read: higher potential return) because you have more time to make up for losses. Generally, people who are older have to be more conservative as retirement is much closer and TVOM (time value of money) makes it more difficult for them to recoup losses.

 

[Chaszmyr]

Normally buying stocks at their all time high isn't necessarily a good idea. What would I say about Apple's stock though? I wouldn't recommend buying it, but I also wouldn't advise against it.

 

[johnnybluejeans]

Has anyone else noticed this?

Just a word of caution. AAPL tends to take a nose dive (6-8%) after their earnings reports, even though last 4 quarters have been spectacular it keeps happening at each report. A lot of the earnings news is already built in to the price (for instance, the 20% increase since the first of the year). Earnings come out Wednesday COB.

 

[matix]

Is it possible that if the stock stays high (or goes up more) there will be another split?

If so, does it help the shareholder?

 

[h0e0h]

Is it possible that if the stock stays high (or goes up more) there will be another split?

If so, does it help the shareholder?

I've never been on the bad end of a split. generally when there's a split its because the company's stock price is too high, so they split it drop the price by issuing more shares. You actually wind up owning more shares for a lower price that either is equal, or of more value. According to the SEC, if you own 12% of a company, then you are still entitled to 12%, so if you have 12/100 shares and they decide to go up to 300 shares then you get 36 and this is possible because 100% of a company's stock at any given time is never owned. GE does it all the time, as well as amazon and google. I've been trading for 2 years and am 1 year away from an accounting degree... i hope i relayed that correctly... its kinda late and i don't feel like proofreading this post like normal...

 

[geekologist]

I'm No Stock Expert....

I'm no expert in stock or anything, but if I was to buy stock right now I would buy Apple. There stock will go up when they release the rest of the Intel Macs throughout the year and especially if they release a cheap Intel iBook. There is also a rumor of a new iPod with a bigger 3.5 inch screen to watch video. Whenever they release a new iPod there stock goes up.

 

[sw1tcher]

I'm no expert in stock or anything, but if I was to buy stock right now I would buy Apple. There stock will go up when they release the rest of the Intel Macs throughout the year and especially if they release a cheap Intel iBook. There is also a rumor of a new iPod with a bigger 3.5 inch screen to watch video. Whenever they release a new iPod there stock goes up.

Actually, the new iPod will have a 10-inch screen and will weigh approximately 8 pounds. Steve said so during the keynote.

 

[geekologist]

Actually, the new iPod will have a 10-inch screen and will weigh approximately 8 pounds. Steve said so during the keynote.

I know. I hope he will do another episode of Super Secret Apple Rumors. Who is this Steve anyway? He said he has pretty good sources in Apple. He doesn't want to say his last name because Apple will sue him.

 

[maxterpiece]

It'll drop once some big press people post negative reports (whether they are accurate or not) about the intel macs. I'd say buy it if it drops below like $77.

 

[rikers_mailbox]

Just a word of caution. AAPL tends to take a nose dive (6-8%) after their earnings reports, even though last 4 quarters have been spectacular it keeps happening at each report. A lot of the earnings news is already built in to the price (for instance, the 20% increase since the first of the year). Earnings come out Wednesday COB.

True, this has happened after the last few AAPL earnings releases. BUT when talking about the stock market, the past is not a reliable indicator for the future. The cause for the "nose dive" is more due to Apple's forecast for the coming quarter(s), not past performance. That being said, if Apple decides to forecast significant growth in Mac sales volume due to the Intel switch, I expect that we will NOT see a reduction in stock price. Furthermore, if the Mac sales forecast is conservative, there could likely be a run up due to speculative buying (which AAPL is so famous for).

Also consider the rumor for an AAPL stock split. This generally has a positive effect on stock price (even though it shouldn't!).

All I know is that I'm hanging on to my current shares, and I'm not changing my position anytime soon. I'm comfortable with my current level of risk.

 

[sw1tcher]

Well, AAPL stock just took a major dive today (~ 7.5%). Might want to consider buying now that it's down. It'll probably go down a dollar or two tomorrow too.

 

[Zeke]

What was that all about today? Were the first quarter results much less than expected?

 

[Le Big Mac]

Well, AAPL stock just took a major dive today (~ 7.5%). Might want to consider buying now that it's down. It'll probably go down a dollar or two tomorrow too.

Most of that is aftermarket sales. Those are always bad indicators. People want to sell out now, so take a sharp loss to do so. It will be down on the open, but not much.

To the OP question: I think the price is fairly high right now. I bought at $13. Unfortunately, I sold at $33. Both pre-split prices. So what do I know.

 

[asherman13]

What was that all about today? Were the first quarter results much less than expected?

No, Apple met expectations. They did, however, say that their 2nd-quarter earnings were going to be lower than those from Q1. The rest of the drop, along with the drastic dive on the NYSE and a lot of tech stocks is due to a hike in oil prices, and less-than-expected results from Intel and Yahoo.

I hope AAPL goes up; my MBP purchase is riding on it...

EDIT I'd say wait for the split; however, def. buy before March if you can...I have a feeling (not rumors, just a feeling) that some big stuff is going to happen in March/April (30th anniversary of Apple...).

 

[sw1tcher]

Don't worry about the split. I wouldn't wait for it. If you buy now and it splits, you've just doubled your shares. Just buy what you can afford. Besides, who knows when the split will be. It might not happen until AAPL his $100 or more.

 

[buffalo]

Is there any kind of explanation for the $3.45 drop today and ~$2 drop yesterday? I'm young with virtually no investor experience, so I don't know much about the stock market.

Besides, who knows when the split will be.

I though I had read somewhere that it was set for a date in March. Was this just speculation?

 

[ITASOR]

I'm also thinking about buying my first stock in Apple soon (before the rest of the intel line is released).

Is it really better to buy after it splits as opposed to right now? Say it's at $70 right now (I know it's not) and it splits making each stock $35. Would an advantage to that be that instead of my one share that I could afford (not really) of $70 increasing $2, BOTH of the $35 stocks would increase $2 each, essentially earning me $4? I'd better take a class on this.

 

[skunkworks]

I would wait a bit before buying I think there is more downside to the stock possibly $70 by end of month in my opinion. Apple will be a good stock to own toward the end of the year, at the moment I don't see any upside considering that their new machines are a big disappointment in terms of speed according to SJ.

 

[therevolution]

Say it's at $70 right now (I know it's not) and it splits making each stock $35. Would an advantage to that be that instead of my one share that I could afford (not really) of $70 increasing $2, BOTH of the $35 stocks would increase $2 each, essentially earning me $4? I'd better take a class on this.

It helps to not think of it in terms of dollar increases, but in percentages. Let's do an example:

If you have 1 share at $70, and the price goes up 10%, you've got 1 share at $77. Total worth: $77.

If you have 2 shares at $35, and the price goes up 10%, you've got 2 shares at $38.50. Total worth: $77.

What's the net result? None. The split has no effect on the valuation of the shares. Does that help?

 

[Dr_Maybe]

First of all, it is generally considered a good idea to have a diversified portfolio. This mean, having stocks in several companies and several industries, even several markets (not just US).

But for instance, for a smaller amount of money, it doesn't make sense to buy 100 different stocks, because you would spend $700 at Scottrade just in transaction fees.

On the other hand, since you are young, you can tolerate more risk. I would probably invest the ~$2500 a few different stocks, maybe 3-5 different ones, maybe with %50 in AAPL and the others in other industries. It is a bit risky though.

My guess is that AAPL costs $100+ next year, but you can't know for sure. Maybe the market takes a dive, and maybe it takes 2 or 3 years. So make sure that you don't need to sell in a few months or a year. In 5 years, I highly doubt that AAPL will be woth less than today.

I haven't invested a lot, but a few years ago, I guess I was 20 years old too, I invested in a tech stock. Just one stock. And it fell 30% or so. I sold it at a loss because I needed/wanted a computer. Had I hold it and sold it today, I could have gotten almost 4 times as much for it as I sold it for. So invest for the long run.

 

[therevolution]

First of all, it is generally considered a good idea to have a diversified portfolio. This mean, having stocks in several companies and several industries, even several markets (not just US).

But for instance, for a smaller amount of money, it doesn't make sense to buy 100 different stocks, because you would spend $700 at Scottrade just in transaction fees.

There are these pretty cool things called "mutual funds." You might want to check them out.

 

[BlueT]

Buy at 70-75

I agree with waiting until it hits 70-75. It wil keep dipping because people from last year anticipated that MWSF would cause a 10% rise in a couple of days, which it did. Now those same people are cashing out, along with others who think that apple is currently overpriced, leading to a huge decline.

Let the market clear out a bit more and buy...over the next year, I'm not sure about the the split, but Apple's stock is definitely a strong buy. Their music/ipod model is only getting stronger and they've yet to see a substantial competitor, which will lead to continued growth beyond expectations.

 

[buffalo]

How much longer do you think apple will keep falling? Do you think it will find support at $75 or closer to $70?

 

[stevep]

I'd like to invest in my favorite company if it's a good idea.

This is the bit that bothers me - sentiment has no place in share trading. Apple are a tricky company to invest in as there are so many unknowns (they are based in the US, they sell to US, Asian, Australasian and European markets, they depend on labour in SE Asia, esp China, and they have a large number of global component suppliers). Any change in any one of those factors could be risky - remember the fire in the chip factory that sent RAM prices sky-high?
Good advice from Dr_Maybe on a diversified portfolio and sticking out for the long haul. I too have some high tech shares in a reputable and successful company, but they dropped 75% 3 weeks after buying. That was 3 years ago and they're just about back up again. Luckily some of my other shares have worked a little better!
PS Buy low, Sell high !!!