February 6, 2008

Wednesday, February 06, 2008 at 02:10 PM | Posted by kazouz

Let’s talk stock. Apple’s stock. It’s my favorite topic when I am with peers who want to know about the company. Long-time readers will know that I have made several predictions about Apple’s stock, and most all have been quite accurate. I predicted that the stock would break $200 per share in 2007 and it did.

Today, I want to offer another prediction.

Apple, along with several other publicly traded companies, has taken a very hard hit this year. As of this publishing, Apple’s stock is in the mid-120’s. What is the outlook? As a veteran shareholder of AAPL, I have some advice to everyone who has concerns about the stock. Hold it - and if you don’t own any, buy it.

I think Apple’s stock may drop as low as 120 before it rebounds. But when it does, I foresee quite a bounce. Apple is in a position unlike any other time in the company’s history. Let me explain a few factors that will propel the stock in 2008.

1. Leopard - Apple’s new operating system is the most advanced operating system in the world, and the adoption rate of Mac OS X is faster than it ever has been in the past. Not to mention that in comparison, it cripples Windows Vista.

2. Product line - Apple’s product line is strong. No, Apple’s product line is extremely strong. The Mac line-up is diverse, and appeals to all age groups, and all lifestyles. From pro users, to desktop and office use, to ultra-portable use.

3. The iPod - While many discount the potential of the iPod’s future, keep in mind that only a small percentage of the population actually owns an iPod. iPods are great gadgets with a bright future, and most people who own them would upgrade to a new one. Apple is about to push its iPod touch as a wireless wi-fi communicator, and not just a music player. This new device appeals to a much larger audience and is much more functional than previous models.

4. The iPhone - Apple’s iPhone is hot. It is better than any other phone in its price range, and arguably the best phone ever made. The ‘unaccounted’ iPhones that are being sold on the black market are a valid indication of how popular the phone is overseas and how sought after the phone has become. Apple is just scratching the surface with this iPhone and it has only been available for a few months, not to mention that it’s grabbed 28% of the US smartphone market as a rookie.

5 Apple TV - Apple TV is a real player in the movie industry as content is about to be added to the device. In a software upgrade due in about a week, Apple will offer users the ease of renting a movie or buying a song from the comfort of the living room chair. Movies are in high definition, and can be transported to many other digital devices. As this device becomes the clear front-runner, Apple TV will pave the way as the standard for renting movies. As millions of people adopt this device into their homes, Apple will make a percentage off of each movie rented, further adding to its bottom line.

I haven’t even mentioned the cash reserve that Apple has or the fact that Apple always holds special events throughout the year. But rest assured, that buying the stock, and holding onto it will reward those nicely. Steve Jobs is very conscious of the stock’s price and has advised shareholders to “hang in there.”