Apple’s stock, which seemed unable to do any wrong for the past decade, has stagnated in recent months. In fact, worse than stagnated: shares in AAPL are down more than 35% over the past five months.
Apple isn’t happy about it and the company’s chief executive officer, Tim Cook, wasn’t shy about admitting as much during an annual meeting today. “I don’t like it. The board doesn’t like it. The management team doesn’t like it,” Cook told investors at the company’s headquarters on 1 Infinite Loop.
Cook strongly encouraged investors to focus on the company long term, which is actually good advice for all investors buying absolutely any stock. The CEO hinted at new product categories, but not surprisingly offered no additional details. Rumours suggest a television and smartwatch are in Apple’s future.
The decline in Apple’s share price sucks for those who bought at $700 – it’s now below $450 – but it may present an excellent buying opportunity for those who haven’t yet acquired shares (or are looking to add more Apple to their portfolio): the stock is trading at a shockingly low price-to-earnings ratio of 10.1, far lower than the average of large technology companies and well below the S&P historical average. And that’s without any evidence Apple’s earnings will decrease in future quarters.