5 Stocks You Should Sell Before Recession

4. Apple Inc. (NASDAQ:AAPL)

Number of Hedge Fund Holders: 134

Apple Inc. (NASDAQ:AAPL) makes and sells consumer electronics. Although the company beat market estimates on earnings per share and revenue for the second fiscal quarter, Tim Cook, the CEO of the firm, said during the earnings call that Apple was not immune to the “challenges caused by the war in Ukraine and COVID-related disruptions in China”. A senior Apple executive also revealed that the earnings of the firm would be impacted by “supply constraints, silicon shortages, with the value of the constraints between $4 billion and $8 billion”. 

On April 29, Deutsche Bank analyst Sidney Ho kept a Buy rating on Apple Inc. (NASDAQ:AAPL) stock and lowered the price target to $200 from $210, noting that the firm faces “increased supply-chain and demand uncertainty from China looking forward”. 

At the end of the fourth quarter of 2021, 134 hedge funds in the database of Insider Monkey held stakes worth $186 billion in Apple Inc. (NASDAQ:AAPL), up from 120 in the previous quarter worth $146 billion.

In its Q4 2021 investor letter, Berkshire Hathaway highlighted a few stocks and Apple Inc. (NASDAQ:AAPL) was one of them. Here is what the fund said:

“Apple Inc. (NASDAQ:AAPL) – our runner-up Giant as measured by its yearend market value – is a different sort of holding. Here, our ownership is a mere 5.55%, up from 5.39% a year earlier. That increase sounds like small potatoes. But consider that each 0.1% of Apple’s 2021 earnings amounted to $100 million. We spent no Berkshire funds to gain our accretion. Apple’s repurchases did the job. It’s important to understand that only dividends from Apple are counted in the GAAP earnings Berkshire reports – and last year, Apple paid us $785 million of those. Yet our “share” of Apple’s earnings amounted to a staggering $5.6 billion. Much of what the company retained was used to repurchase Apple Inc. (NASDAQ:AAPL) shares, an act we applaud. Tim Cook, Apple’s brilliant CEO, quite properly regards users of Apple Inc. (NASDAQ:AAPL) products as his first love, but all of his other constituencies benefit from Tim’s managerial touch as well.”