Tuesday, June 10, 2014

Apple Stock is Now Much More Affordable

Due to a 7-for-1 stock split, Apple (AAPL) is now under $100 per share. Last Friday it was $645. If you want volatility, this may be a good buy. The beta is 0.74, so it goes up and down frequently. Steve Jobs' innovations like the i-pod, i-pad and i-phone have made Apple the go-to tech company with fiercely loyal followers. The stock has been amazingly successful, rivaled only by another tech stock, Google (GOOG). The 52-week range has been between $55 and $95 per share so one can get in and get out and make a tidy profit, or hold onto it for the long haul. The stock scouter rating on msn.com gives this a 10 out of 10. The chart above shows the monumental rise of Apple since 1992, and it is nothing short of amazing. In 2007 it was $100 per share and it has shot up to over $600 since then. A plus for investors is the fact that this stock gives a good dividend too, of 13.16 and a yield of 2%. As of 9/28/13 the total assets are $207 billion and the total liabilities are $83 billion, so the debt load for this company is not too high. Investing in a company that is drowning in debt is not a good move. Looking at the amount of debt compared to assets is a key indicator of whether or not a stock is a good investment. Debt can sabotage monetary success, whether we are talking about a business, or personal finance. Many will be interested in buying this stock at a "bargain" price. At over $600 per share, it was out of reach for many. Google stock is currently $555 per share. Will they follow suit and also exercise a stock split to make their stock more affordable? Information on the implications for Apple shareholders who exercise options can be found here.

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