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At times like these, I like to remind investors about my friend "Pete."
I last told you about him and the colossal mistake he made in our Dec. 15 chat.
You may recall that the former Wall Streeter actually passed on Apple Inc. (NASDAQ: AAPL) in the summer of 1997 because he felt the storied computing firm had already seen its best days.
Of course, we now know that Apple is one of the great investing success stories of all time.
I'm bringing this up today because I see a similar mindset taking hold among investors. After a rapid selloff in February and March, the market has been rebounding nicely.
And yet, many are afraid to pull the trigger, even on a company as valuable and built for the long haul as Apple.
But at the very least, the Silicon Valley legend should be on your bear market watchlist because the stock is set to double again from here…
Apple Stock's Solid Foundation
Now then, let's be clear. We're not getting the opportunity to buy the stock for pennies on the share as you could have back in 1997.
At the time, Apple looked like it was headed for bankruptcy. Today, despite the recent selloff and an impending recession, the firm still has plenty of cash in the bank and boasts a market cap of nearly $1.2 trillion.
Please don't think I'm being naive. I realize all too well that Apple faces some challenges ahead. But I believe they are short term in nature and brought on by the coronavirus panic.
Yes, the factories of Apple and its suppliers were shut down for several weeks as China went into quarantine.
In fact, Apple was one of the first to announce that the COVID-19 outbreak would affect its business. It also decided to close all its retail stores, first in China, then in the rest of the world.
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But those factories and stores in China are back online, and Apple seems at worst a few weeks behind on the supply side.
Let's look at the challenge from the customer demand side. Two-thirds of Apple's sales come from the U.S. and Europe, areas that have been under heavy economic lockdowns for several weeks.
But here at home a $2.2 trillion stimulus bill – the largest in American history – was recently signed into law. I believe this will go a long way towards reversing any damage.
And remember, not only is Congress talking about another stimulus bill, the Fed says it will pull out all the stops to get the nation moving forward quickly.
Meantime, Apple watchers like me say it's a good bet the firm won't release its news iPhone until around Thanksgiving. I'm happy to report I still see plenty of demand for Apple's signature smartphone.
The reason is simple: 5G broadband wireless.
The New Standard in Wireless Connections
See, the newest releases are expected to include the first-ever 5G-enabled iPhones. 5G is the next generation of wireless communication. It promises to boost download speeds by 10 times or more compared to existing 4G LTE networks.
Even better, 5G will reduce congestion and improve signal strength and clarity. It also will cause massive shifts in how we use our smartphones.
With much faster connections to the Internet, iPhones will be able to leverage smarter AI, use Augmented Reality to provide real-time information about our surroundings, and much more.
This jump to 5G is what will drive people to upgrade their iPhones, as many have waited for this generational shift before replacing their older phones.
Remember, Apple sets the standard by which the rest of the mobile world is judged. For that reason alone, industry analysts expect the 5G iPhone to serve as a catalyst for the whole field.
But more important than that for tech investors is the fact that Apple is today much more than just a hardware company.
An Endless Revenue Strategy Will Drive Apple Stock
About the Author
Michael A. Robinson is a 36-year Silicon Valley veteran and one of the top tech and biotech financial analysts working today. That's because, as a consultant, senior adviser, and board member for Silicon Valley venture capital firms, Michael enjoys privileged access to pioneering CEOs, scientists, and high-profile players. And he brings this entire world of Silicon Valley "insiders" right to you...
- He was one of five people involved in early meetings for the $160 billion "cloud" computing phenomenon.
- He was there as Lee Iacocca and Roger Smith, the CEOs of Chrysler and GM, led the robotics revolution that saved the U.S. automotive industry.
- As cyber-security was becoming a focus of national security, Michael was with Dave DeWalt, the CEO of McAfee, right before Intel acquired his company for $7.8 billion.
This all means the entire world is constantly seeking Michael's insight.
In addition to being a regular guest and panelist on CNBC and Fox Business, he is also a Pulitzer Prize-nominated writer and reporter. His first book Overdrawn: The Bailout of American Savings warned people about the coming financial collapse - years before the word "bailout" became a household word.
Silicon Valley defense publications vie for his analysis. He's worked for Defense Media Network and Signal Magazine, as well as The New York Times, American Enterprise, and The Wall Street Journal.
And even with decades of experience, Michael believes there has never been a moment in time quite like this.
Right now, medical breakthroughs that once took years to develop are moving at a record speed. And that means we are going to see highly lucrative biotech investment opportunities come in fast and furious.
To help you navigate the historic opportunity in biotech, Michael launched the Bio-Tech Profit Alliance.
His other publications include: Strategic Tech Investor, The Nova-X Report, Bio-Technology Profit Alliance and Nexus-9 Network.