AAPL
📉 Apple faces significant headwinds from potential tariffs impacting its supply chains, despite efforts to diversify away from China following previous pressures.
🤔 The stock’s valuation at 27 times forward earnings appears high, especially compared to peers like Google, raising questions about its justification given its struggles in AI.
🤝 Historical precedent suggests Apple may negotiate concessions with the administration to mitigate tariff impacts, potentially offering a short-term catalyst if volatility subsides.
@bernardodegarcia:
“The tariffs from Trump impact the supply chains that Apple has developed to reduce its dependency on China. This was done because Trump told them previously, ‘Hey, do this, or I’ll hit you.’ They do it, and what happens? He hits them anyway. Chip makers get a pass on tariffs, but the slump suggests risks remain. CEOs believe Trump’s tariff plan is a big mistake. It’s tough with Apple. On one hand, how can I justify investing in Apple versus Google? You see a company like Google with good defense, trading below 18 times forward earnings, doing frankly well now with Gemini 2.5, breaking records. And how can I justify buying a company, Apple, that is fantastic with phones and such, but is a tremendous flop in AI and doesn’t know very well how to proceed? The problem is maybe they arrive late, but Apple has never cared about that. But gosh, 27 times forward earnings? Wow. No, I’d say there are things with less risk. But that doesn’t mean Apple shares… I don’t think Trump wants to destroy Apple, not at all. Apple already promised, in fact, Trump already got what he wanted from Apple. Trump wanted the headline that Apple will invest over $500 billion in the United States, and Trump mentioned this headline several times yesterday in his speech. Trump wants to hang medals on himself to use them. So, I believe most of these things will be reversed. Although I consider Apple, even at 27 times forward earnings, a poorly justifiable purchase, I wouldn’t say that perhaps if this stabilizes and you can buy a couple of calls with a slightly lower volatility index, it might be worth it.”
Watch the exact part of the video where @bernardodegarcia talks about Apple here:
Watch the video on YouTube
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