Apple: Poor Risk/Reward For New Investors


  • Apple reported its Q1 results a couple of weeks ago, showing declines in revenues and margins, along with a 10% decline in EPS compared to the prior year.
  • With a market cap of $2.4T, I don’t see how Apple will be able to produce returns for investors like they did over the last five years.
  • Shares are expensive today with a price/earnings over 25x despite projections of slowing growth.
  • Apple dumped $19B into buying back stock despite the rich valuation. I’m curious to see how the 1% buyback tax (which came into effect on January 1st) impacts the company moving forward.
Apple Faces Shortages In iPhone Supplies Amid Turmoil In China

Scott Olson

Last time I wrote an article on Apple (NASDAQ:AAPL) was a couple of months ago, and I explained why I would rather own Berkshire Hathaway (BRK.A) (BRK.B), which also has a large stake in

Disclosure: I/we have a beneficial long position in the shares of BRK.B either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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