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Apple 'Healthiest Tech Co. Ever,' Amazon 'Spectacularly Well' Positioned

Posted Apr 24, 2008 12:07pm EDT by Aaron Task in Investing, Electronics

Despite posting quarterly results that bested expectations, shares of both Apple and Amazon.com were falling early Thursday. (Apple shares have since rebounded sharply but Amazon.com was recently down 3.3%.)

Apple's fiscal third-quarter earnings guidance was below expectations, and analysts expressed concern about their gross margins. Meanwhile, traders overlooked Amazon.com's raised revenue guidance and focused instead on its weak operating income guidance and gross margins.

The reality is both stocks are richly valued, which also helps explain why short-term traders are focusing on the negatives.

But long-term investors should not lose sight of the big picture, which is "spectacular" for both companies, says David Kirkpatrick, senior editor of Internet and technology at Fortune.

Apple is "one of the healthiest tech companies I have ever seen," Kirkpatrick claims, noting the firm's "awesome" 43% revenue growth and 51% growth in Mac sales.

Amazon.com, meanwhile, is "a great company to own" in an economic slowdown because of its low prices, he says. Also, the company is executing the long-term strategy Jeff Bezos laid out when he founded the company in 1994.

17 Comments

jim
jim - Thursday April 24, 2008 12:14PM EDT

Eat dirt and cry all ye who bashed the stock previously...

adel
adel - Thursday April 24, 2008 12:19PM EDT

appl is the best stock to bay ever i love the stock

That other guy....
That other guy.... - Thursday April 24, 2008 12:20PM EDT

Henry Blodget and Aaron Task called AAPL @ 119 basically as the bottom back in February, thats when I got in and am sure glad I did!

Dale
Dale - Thursday April 24, 2008 12:31PM EDT

Need to update your tittle AAPL is up more than 2.5%

Aaron
Aaron - Thursday April 24, 2008 12:33PM EDT

Dear That other guy.. Thanks much! Glad somebody remembered and (better yet) profited. - Aaron

PeterM
PeterM - Thursday April 24, 2008 12:42PM EDT

Nowhere to go but up for AAPL: -Creating new Markets. -Changing old market standards. -Buying new chip manufacturers and innovative companies. -Growing market share by multiples. -Charismatic CEO makes deals with other industry giants. -CEO's from other companies seated on Board of Dir. (Google) Of course that means nowhere to go but down for MSFT: -Concentrating on saturated low margin market. -Trying to keep old market standards proprietary. -Trying to do hostile takeover of innovative companies. -Trying to hold on to shrinking market share. -Self centered spastic CEO rants and ridicules other industry giants. -Who is on the Board of Directors?

Peter
Peter - Thursday April 24, 2008 12:50PM EDT

AMZN is like any other retailer in a recession, its sales are going to slow. Period.

__A_YAHOO_USER__
__A_YAHOO_USER__ - Thursday April 24, 2008 12:53PM EDT

apple... yes baby!!!!

Diamonte
Diamonte - Thursday April 24, 2008 01:20PM EDT

u like.

Yahoo! Finance User
Yahoo! Finance User - Thursday April 24, 2008 01:35PM EDT

I really like Yahoo and I think this stock has an upward trend to make in the near future. I think Yahoo is doing a great job. Why can't they be another Google someday? Just look at APPL right now!

Yahoo! Finance User
Yahoo! Finance User - Thursday April 24, 2008 01:36PM EDT

I really like Yahoo and I think this stock has an upward trend to make in the near future. I think Yahoo is doing a great job. Why can't they be another Google someday? Just look at APPL right now!

Yahoo! Finance User
Yahoo! Finance User - Thursday April 24, 2008 02:10PM EDT

Yahoo began with a bad idea: "Instead of using search engines, we'll use people to classify the contents of the Internet, like a library catalog." Wrong. Now they have a me-too search engine that will never catch up to Google. They lack real innovation. Google maps rocks. Yahoo maps bite. All Yahoo has is a "portal" based on it being the default home page for people who don't know how to change their home page -- like AOL, it survives on people's ignorance and self-doubt. No future. All they really have is Yahoo Groups. And anyone who wants to badly enough can take that business over. There's nothing hard or innovative about the software behind it. They own it because they give it away -- no competition because no profit in it. Yahoo stumbles on, but with no vision, no product, and little to offer. Apple on the other hand invents something totally amazing every year, then makes it better, and performs well as a business. Does anyone think they're done? They're just getting started. The sky's the limit. And Amazon sells everything on-line and ships it to your door. That's the future of commerce. What Sears Roebuck was to the 19th and early 20th century, Amazon is to the 21st. It's hard for them to miss; with over a million products, they're bound to have some hits. And like Apple, they execute well as a business. Google is less well organized, but they're the smartest people on the planet. They generate ideas the way Apple generates products. And their search engine generates beaucoup bucks and pays the bills. It's a wild card. But Yahoo? I don't think so.

Frederick R
Frederick R - Thursday April 24, 2008 02:47PM EDT

Talk about a long time coming. Steve Jobs and Steve Wozniak took a position in the mid 80's and bid the farm on it. "People do not want to learn computers, they want to use them." The company went in the opposite direction of the industry and a quarter of a century later, the path is paying off. Thanks guys for following an old adage ... If you want to succeed, never follow the other guy!"

Wa
Wa - Thursday April 24, 2008 03:33PM EDT

If I were buying Yahoo, I would consider buying them on the strength of Flickr and Del.icio.us. Both were great acquisitions, and Yahoo was smart enough with both of them to let them continue with their own culture that made them special. I also like their Tubes, but not many people know about them, something that I do fault Yahoo for.

Yahoo! Finance User
Yahoo! Finance User - Friday April 25, 2008 12:33AM EDT

apple=annoying cult members

Borremans
Borremans - Friday April 25, 2008 11:24AM EDT

At the end of the year AAPL=200$

datsthat
datsthat - Saturday April 26, 2008 12:35PM EDT

Apple is the shiznit! if you are in 32 or younger (the younger the better) and simply buy 1 share a week and once you retire, you will be very wealthy. Don't believe me? Go back when AAPL IPO'ed and do the math...this works with a lot of other companies that made a positive difference in history......MSFT, GE, BA, GOOG, XOM, COP, SPY (one of the earliest ETF, etc.........

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