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April 14th, 2000

[3:40 PM] Apple Remains Strong Despite Market Downturn
by Wes George

Apple's stock price held the line with remarkable strength in the face of today's terrible selling pressures. AAPL traded down 1 15/16 on strong volume to close at 111 7/8. That's a great way to end the worst week in Nasdaq history.

AAPL is partially shielded from the ill effects of the ongoing market correction because AAPL's price to earnings ratio was already in the low 30s going into this downturn. Also, Apple is likely to announce strong earnings next week and next week is likely to be a whole new world. The market is now going to take VALUE seriously for the first time in years!

Investors are aware that Apple has much as yet unrecognized value, such as QuickTime and OS X. Apple is positioned better than any other PC manufacturer, except perhaps Palm Inc. (PALM), to benefit from the next wave in computing--portable wireless Internet devices.

The stocks that are really getting led to the slaughter house are the Internet and biotech stocks with high P/E ratios but little or no earnings. In fact, most of the earnings-less Internet IPO type stocks are not likely to see new all time highs again this year, if ever.

The Mac Observer Spin: The days of the "greater fool theory" of investing and stocks values supported by promises rather than performance are over. A new breed of market leaders--like Apple-- strong companies with growing earnings and dominant positions in their market space are emerging to fill the vacuum left by the fallen high tech wunderkinds.

Many investors and traders, both retail and professional, young and old, dumb and smart have taken serious wounds this week. It could take months to recover. But recover it will, rest assured. Our hearts go out to those who lost everything on a margin call or those who have just recently invested in the stock market. The worst is over and Monday will be the beginning of a new week, in more ways than one.


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