Apple Inc. (AAPL)’s Short vs Long Term Performance

Apple Inc. (NASDAQ:AAPL) has been a leading company in terms of both innovation and profits, but the company has a challenge ahead. Sarat Sethi, managing director at Douglas C. Lane & Associates, said in an interview on CNBC that Apple Inc. (NASDAQ:AAPL) will have to struggle to realize its long-term perspectives, which are the ground foundation for its revenues and competitive advantage.

AAPL Apple Store

“[…] Shorter term, the stock’s had a great run. It’s inevitable that people take money off the table ,especially with the market being at all-time highs, so that doesn’t really worry me as much. It’s really coming forward how well these products are received, and really what the take it is. That’s going to be really important […],” said Mr. Sarat Sethi.

Since, Apple Inc. (NASDAQ:AAPL)’s price declined yesterday, it might be a good idea to start buying its shares, in the event that the price will explode soon. Confidence over the fact cannot be attained at the moment, but the company’s performance shows a promising trend. The problems that might arise are at the competition level, where companies like Samsung, directly compete with Apple Inc. (NASDAQ:AAPL).

Consequently, there are predictions related to diminishing margins compared to the market for the Cupertino, California-based company. This threat can prove futile in case people expect the whole range of their devices to be connected together, that is, they want to enter a whole new ecosystem through the purchase of one device. Moreover, margins will be at a lower value since the company’s currently focused on production and capacity, but they might rebound soon.

The report further dismissed the possibility of Telecoms to gain bargaining power with respect to hardware manufacturers in order to cut into their margins, on the grounds that the services provided by these companies are currently perceived as commodities.

Apple Inc. (NASDAQ:AAPL) is currently selling at about $99 per share, and might decline further as uncertainty about their release exists and people expect fewer profits in the short period around the launch. However, assuming that iPhone 6 will be a success, the stocks might jump to a new all-time high.

Disclosure: none

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