Monday, February 14, 2011

Get Ready to Sell Apple

If you bought Apple stock in January 2010 at $192/share when I predicted that Apple's iPad (which wasn't released until April) would "better accommodate much of what we currently do, uncomfortably, on our computers",

...or if you bought Apple stock when it hit $300 last October, and I
wrote "while that price bakes in an obscene level of positive expectation, I think Apple will beat it",

...or when I,
urged you a few weeks ago, to pick up a bargain when Apple's stock dipped on news of Steve Jobs' medical leave - and it fell from $348 to $326, well, congratulations. Today it's about $360. And it's getting to be time to sell.

I'd suggest $375 if you're the nervous type, or $400 if you're the brave type. Understanding of iPad's huge, paradigm-shifting nature has mostly sunk in, even though sales are still steeply accelerating. And while Apple surely has other surprises up its sleeve (and I'm not sweating Jobs' medical leave at all), the previously underestimated potential is now built into the stock price, so, barring another flat-out home run this year (which I don't expect), there's nowhere to go but down.

Plus the market is due for a downturn. Plus yet another tech bubble has been building to a ripe point (not directly involving Apple, but it may be collateral damage in a burst). Plus zillions of unknowable factors. Sometimes you have to acknowledge that the party's over.

Unless you're contrarian by nature, I realize that it's hard to sell when something's shooting up and everyone's exuberant. Just as it might have been hard to buy Apple at $115 a few years ago, as I did, when it was in a listless lull. But non-contrarians shouldn't be actively investing.

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