Maybe it’s time - at least according to an article I just read on AlleyInsider.
So yes, maybe it’s time: the stock peaked at $200 on December 28th 2007, to fall down to $130 yesterday, exactly a month later. A 35% steep cliff.
The consensus is to hold or buy, for obvious reasons: the company is pretty healthy, sales are up, it’s still sexy, there is no downturn conceivable for Apple right now - besides sailing through the recession, if any.
But there is something else: a feeling. A few years ago, buying a Mac was a luxury, kind of an anarchic and revolutionary action, stating who you were, what you thought of the giant. A marginal scream saying: I am different, I am a Mac. Today, it feels like everyone has one, and that Apple is gaining a LOT of traction by younger generations. 1 out of 2 or 3 of my friends have Macs, or plan to buy one. At Georgetown Uni, 25% of students arrive on campus with Macs. Even more at other universities.
Today, it feels like everyone is on Mac. And you know what ? Numbers tend to corroborate this feeling.
From Gartner in this New York Times article, Apple would soon reach 8.1% of the US computer shipments in 2008. According to Charles Wolf in that same article, Mac even captured 15.8% of home computer revenues during Q2 2007. For every $7 spent in home PC purchases, $1 was for Apple. Wow.
And the core contributors to Apple’s revenues are not iPod, iPhones or iTunes sales. No, it’s Macs. Plain old (sexy trendy) Macs. And with Mac sales growing 40% year over year (also see Apple Insider) and contributing to 40% of revenues, well, do the math: revenues in 2007 were of $24B, with Mac contributing (based on above info) to approximately $10B. This $10B is growing at a 40% rate year over year. At this rate and with a linear 101 forecast, Apple would realize over $25B in Mac sales only by the end of 2010 !
So yes, with a stock at $130, the level of a year ago and 35% less than a month ago, I would buy AAPL. With confidence.
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