How can one decide to buy Amazon.com, Inc. (NASDAQ:AMZN) at the expense of Apple Inc. (NASDAQ:AAPL), which is trading at 16x below the S&P average with a multiple of 19.5? Depending on your investment strategy, according Fox Business, Charles Payne, one could be justified on owning either stock. The analyst, however, remains long on Apple which he maintains has a great business model compared to Amazon.
Apple Inc. (NASDAQ:AAPL) has already clocked record highs in terms of market value with the biggest question being how high the stock could rise, in the months to come. Amazon.com, Inc. (NASDAQ:AMZN), on the other hand, seems to be picking up its pieces having not had the best runs in 2014, seen by the stock losing substantial amount of value.
“For me here the question is are you investing in a great business, or you are investing on whether the stocks pops up tomorrow. Because, essentially a lot of people tell me they’re investors, and they do the exact opposite. […] I love the idea of investing in a great business and not to worry about short term shenanigans,” said Mr. Payne.
At the current market fundamentals, Apple Inc. (NASDAQ:AAPL) looks like a good short term pick as the company continues to enjoy positive sentiments from the Street. Amazon.com, Inc. (NASDAQ:AMZN) on the other hand buoyed by impressive fourth quarter earnings could act as a good long term play waiting to see if investments in growth opportunities initiated by CEO, Jeff Bezos, will pay up.
A good investment strategy according to Payne should be made of 70% in long-term trades with the remaining 30% traded on the levels of volatility. Retail analyst, Hitha Herzog, who sees Apple Inc. (NASDAQ:AAPL) as a long term play believes the stock could double going forward.
“I don’t believe really in doing things short term especially when it comes to trading and that is not really the sort of my real house. […] This guy was looking at the fundamentals and looking at what makes a good company, and I think that is what people should be looking at, the long-term,” said Mrs. Herzog.
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