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Michael Kramer and the Clients of Mott Capital own the shares of AAPL
2019 is nearly here, and that means it is time to roll out my ten predictions for the new year. As I did last year, I will start with number 10 and work our way up to number 1 over the last month of 2018. Enjoy!
Prediction #3 – Apple is The Comeback Stock of 2019 and Rises 70%
Apple’s stock has fallen 33% since October from their highs. But with the Fed on hold, interest rates and the dollar falling, and oil rising, the stock markets risk appetite comes back in a big way in 2019. Not only that but once again Apple proves the skeptics wrong and the iPhone Xs, X max, and Xr will deliver record-breaking iPhone revenue when the company reports fiscal first quarter results in February.
Service Revenue
On top of the strong iPhone revenue, Apple services continue to show strong growth and impressive gross margins. Investors finally realize that Apple is more than just a phone maker, but a consumer services business. As a result, investors finally re-rate the stock, boosting its PE ratio to 20 times forward earnings, in line with other consumer stocks.
AAPL PE Ratio (Forward 1y) data by YCharts
The Comeback
The result is a stock that recoups all of its losses, reclaims the crown of the most valuable company and a market cap of over $1 trillion. Shares end up rising to roughly $265, an increase of 70%.
It makes Apple the comeback stock of the year and our prediction #3 for 2019.
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This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.