Why I'm Seriously Thinking of Buying Apple

LONDON -- I'm not an Apple fanboy. I don't like the "closed world" of Apple's technology, and I've never bought one of its products. 

I did have an iPod Shuffle, when it first came out, but that was given to me. It was certainly impressively small and light. (So light, in fact, that I didn't notice it in a pocket, and it went through a complete wash cycle. Small and light it may have been, but waterproof it was not.)

But not liking a company's products is not necessarily a good reason not to buy the shares. I'm not wild about Coke, but I'd be very happy (and rather wealthier) if I'd bought Coca-Cola shares when Warren Buffett did.


I didn't buy Apple shares at the end of the '90s because I didn't think much about the company at all. At worst it seemed washed up -- at best it made niche products for trendy people and graphic designers.

When the iPod came out, I thought it'd also be a niche product for trendy people, and that the mass-market for such things would be seized by more mainstream electronics companies, such as Sony or Philips.

Ditto the iPhone. Surely a big player such as Nokia would easily dominate the smartphone market?

I didn't think that a company such as Apple -- a company that had come close to ceasing to exist, really, toward the end of the '90s -- could possibly become the world-bestriding colossus that it has. 

As the share began its upward trend under Steve Jobs, it always seemed that it just couldn't continue, and so I resisted buying. As Apple's price climbed and climbed, my resistance to buying grew with it, because surely it couldn't go any higher. But it did, and I should be kicking myself. (But that wouldn't change anything and might hurt.)

And then Apple fell.

Plummeted might not be too strong a term. Closing at $450.50 last night, Apple is now a whopping 36% down from its peak of September 2012.

I reckon it's fallen too far for a company of this quality and growth record, and too far for a company with nearly $140 billion -- almost a third of its market cap -- in the bank. Irrational negativity about the company has taken hold and the sell-off has been too big. At its current price, Apple is on forward P/E of under 9. That's just wrong.

And that's why I'm seriously thinking of buying Apple.

Finally, let me just add that Apple's stock rallied from $3.28 to $700 between 2003 and 2012, creating a life-changing 213-fold return for investors smart enough to spot the opportunity. Such enormous gains are the subject of this special Fool report, which outlines the steps you might take if you, too, are aiming to become seriously rich from shares.

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The article Why I'm Seriously Thinking of Buying Apple originally appeared on Fool.com.

Jon Wallis has no position in any stocks mentioned. The Motley Fool recommends Apple and Coca-Cola. The Motley Fool owns shares of Apple. The Motley Fool is short Sony. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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