“It’s one of the stocks I feel better about in a very turbulent market.” — Steve Weiss, Short Hills Capital
Transcribed from Weiss’ appearance on CNBC’s Halftime Report Tuesday:
I’ll give you five reasons:
- I like the fact that [Tim] Cook tends to have the ear of the President. He’s one if the few people that can walk both sides. He transferred some production recently to China, but yet he still has Trump’s ear and Trump spoke positively about the arguments he made about the competitive disadvantage to Samsung they would suffer if they continue with the tariffs.
- One of my major criticisms of Apple was that historically they’ve been very arrogant in their launch of competing technology, such as functionality on phones versus the competition’s. In other words, they relied on their brand to unseat the competition by coming out with a camera Samsung had come out with before. I’m noticing a decided change in this strategy because they’ve recently become more aggressive. They bought Intel’s modem business and that will allow them to get their 5G launch quicker… I think 5G will be the biggest upgrade cycle that we’ve seen in many many iterations of the iPhone. Bigger than had been expected for the iPhone X but didn’t occur…
- I also had concerns about the budget that they were putting toward streaming. It was going to be a billion dollars. Now if reports are true coming out of that’s now $6 billion… [Apple disputing]
- In line with the aggressiveness, they traditionally don’t reveal pricing until the product comes out. They released it [?] today, apparently. They’re not waiting for the competition, they’re going head to head with Disney.
- If you take a look at a long-term chart of their stock, you’ll see that they’ve always outperformed down markets, and they’ve always outperform the indices. Now we make a big deal it being up since the bottom in January, but if you look at the gap, it’s closing divergence. And this can go again to not just a—forget about the multiple—but to outperforming consistently versus the averages.
So I do see the stock making new highs. I do like the fact that they are buying back shares because that increases your holdings per share without having to have the growth. So for all those reasons I added to [my holdings] significantly. It’s one of the stocks I feel better about in a very turbulent market.
— CNBC Halftime Report (@HalftimeReport) August 20, 2019
My take: Last time we heard from Weiss, Apple was in free-fall and he was happily piling on. See Watch CNBC bears kick Apple on the way down (video)