logo
  Join        Login             Stock Quote

Top Stocks 2013: Apple & Freeport

 December 28, 2012 09:33 AM
 


by Russ Kaplan, editor Heartland Adviser

Apple, Inc. (AAPL) is a good case for the role psychology plays in investments, and this is when my B.A. and M.A. in Sociology comes in very handy.

Meanwhile, Freeport-McMoRan Copper & Gold (FCX) is a classic illustration of the difference between short-term thinking and long-term thinking, or making a quick buck vs. making a good investment.

In 2012, Apple broke the $700 level and analysts were saying it was the greatest thing since sliced bread.

After a 25% correction, analysts are now saying it is mature company past its prime. Honestly, has the company really changed in such a short time, or is this another speculative algorithm from the Quantitative Analysts?

[Related -Sobering Quarter and Guidance for Long-Time Apple Bull]

By all my measures of value, Apple is a good buy. Is price/earnings ratio is 11, which is less than the total market, and about one half of Apple's normal p/e ratio.

Yes, there is constant change in the computer industry, but Apple, with its management skills and huge trove of cash, should be able to adapt to this in its usual seamless manner.

Apple pays a dividend of about 2%, so if you are looking solely for income this is not a stock for you.

Freeport-McMoRan Copper & Gold recently fell sharply on the news that it was going to spend $9 billion to purchase two oil companies. These acquisitions are an attempt to expand their business.

Was this a good move? If you were looking towards the next quarter's earnings you are probably would not be interested in investing in this stock.

[Related -What does Istanbul have to do with AAPL?]

Now, let's take a long-term investment view of the company. What Freeport-McMoRan has done is diversified its business from being solely into mining, to a mining and oil exploration.

Therefore, if you want a quick profit, you should avoid this stock. But if you want a good investment for the long run, then Freeport-McMoran is for you.

iOnTheMarket Premium
Advertisement

Advertisement


Post Comment -- Login is required to post message
Name:  
Alert for new comments:
Your email:
Your Website:
Title:
Comments:
 

rss feed

Latest Stories

article imageChart Says This Retailer's Comeback Isn't Finished

One of the surprises, at least on the surface, of the market's recent swoon was the outperformance of read on...

article imageETF Performance Review: Major Asset Classes | 19 Dec 2014

It’s all about real estate investment trusts (REITs) these days when it comes to bullish performance among read on...

article imageOil and Global Stock Markets Rebounding Sharply

So far so good on our expectation of a 4 to 5% pullback and then a resumption of the bull read on...

article imageGrading the FOMC

Love its members or loathe them, you have to admire the gradual impact the policy-making committee has had read on...

Advertisement
Popular Articles

Advertisement
Daily Sector Scan
Partner Center



Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.