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Tuesday, July 19, 2011

some thoughts... AAPL, IBM

AAPL - Intraday activity most likely suggests the big boys are questioning whether Apple can meet the whisper numbers of $26.5B in revenue and $7.09eps. (These are some pretty sizable whisper numbers.) IMO, potential weakness is short-sighted, as any number higher then the current (normal) consensus will pin AAPL at a very favorable valuation.  So even if it does sell off after they report, I will be a buyer. I will not wait for dust to settle, I will just be a buyer because valuation is still very very attractive (despite its move) and the one division where growth is a concern for investors has an $80B opportunity in China Mobile and China Telcom alone.

IBM - Its seeing a well deserved appreciation from the street. I will not be a chaser, and will be patient. I have been in this stock, one-way-or-another, since it was in the low 120s to the low 170s. There will always be an opportunity to re-enter this name. (IMO, the only way it keeps rising, from its current appreciation, is if the street rewards it with an immediate and sizable multiple expansion.)