Time to get excited about Apple (aapl)


I have been following Apple’s stock for over twelve years, since working for a hedge fund that purchased the stock when it was less than $10. And I’ve been known for having some controversial views on the stock.

Despite all of the fanfare surrounding Apple going into this year — on this blog, for the early part of 2013, I told everyone to sell Apple. In fact, my views on Apple were so against consensus that I’ve even been called an Apple bear by Fortune.com and CNN Money — not true, by the way. I’m not a bear or a bull. Rather, I’m just a realist.

All of that said, for those of you that are consistent readers of my BillionairesPortfolio.com blog, you know that on May 18th, I flipped the switch on this stock. In fact, I said flatly that the bottom for Apple was in.

That’s been dead on. Not only did the bottom hold, but today we’re getting a breakout in Apple, just as I forecasted in late July (here). We’ve now completed an inverse head and shoulders pattern (bullish!) and my target for aapl is now north of $500. In fact, I think we see $550 before the year is over.

Remember the most important thing that moves a stock is money flow, psychology and sentiment. All three of these factors have been extremely positive for Apple over the past two weeks. With stocks breaking above 1700 last Friday, the mutual fund managers of the world have no choice but to plow any cash into the market – average investors too. And guess what’s first in line for mutual fund managers that are getting new inflows and have cash to put to work: Apple.

Will Meade
President, The Billionaires Portfolio