I’m not talking about the iPhone 4S or the iPad 2, I’m talking about the stock. On January 3rd 2012 (the first day of 2012 equity trading) Apple opened at $409.40 a share. Today, March 15th Apple is about to hit $600 a share, a gain of 46%. Wow! If you are a happy owner of Apple is this a good time to sell? Maybe. If you are thinking about buying Apple stock is it too late? Maybe. Remember six weeks ago Apple was at $500 a share. Can Apple rise to $700 over the next six weeks? Maybe. My point being if you decide to step in and buy Apple have an exit strategy. I repeat have an exit strategy. If you don’t DON’T BUY IT! Way way back in 2007 another large stock, Google was making an amazingly similar move (see PDF). The euphoria around Google was enticing investors from every walk of life to own the next $1000 stock. Unfortunately after reaching $747 a share in November that year, Google shares fell 62% over the following twelve months ($280 per share). Can the same thing happen to Apple? I doubt it but the market doesn’t care what I think. If you asked me on January 3rd whether Apple could hit $600.00 before St. Patrick’s Day I would have said I doubt it; proving the market doesn’t care what I think. Finally take a look at the PDF comparing Apple’s 2012 rise with Google’s 2007 rise and ask yourself: Can the same thing happen to Apple? Maybe.
Happy St. Patrick’s Day to all!