Buy Apple Right Now

As the credit crisis takes a toll on the stock market, companies that have no exposure to the credit markets become more attractive than ever. Apple, the consumer icon that has tremendous horizontal integration among its portfolio of great quality products, is in a position to grow earnings even in times when consumers are cutting back on discretionary spending. The brand recognition Apple has built up through its genius marketing is unmatched and any downward pressure on the stock as a result of the overall market should be looked at as a buying opportunity. The company has no debt and over $28 billion in cash. How’s that for a strong balance sheet?

From an investor’s perspective, the stock is a screaming buy after the drop in value following the announcement of Steve Jobs’ leave till June. Although Steve Jobs is essential to Apple’s success, his leave does not change the company’s fundamentals one bit. Investors should be concerned for his health but not to the extent that it skews their perception of the company’s fundamentals. Apple trading at around $80 immediately after the announcement is an extremely attractive entry point for traders and more so for long term investors. Apple’s product portfolio is strong and the company is growing at a much faster multiple in comparison to its competition. Its products remain in strong demand and are unrivaled in simplicity and design. The iPhone is still strides ahead of competition despite competing products in the market such as the Blackberry Storm. The iPhone’s dominance is tough to compete with and the company will continue to reap in benefits through its exclusive agreement with AT & T as well as from the App Store.

The new pricing structure of iTunes music downloads is strategically promising as loyal customers will continue to purchase popular music from Apple despite the minimal price increases. The software is the best of its kind and is so intensely integrated with all its products that Apple has in a sense created an obsession among its customers. Those who try an Apple product tend to be drawn into the cult known as the Mac faithful.

Considering that the fundamentals and the product offerings of Apple remain strong, the stock is grossly undervalued under $80 a share and all the negative news is priced in, at least until further announcements are made regarding Steve Jobs’ health. The pile of cash enables Apple to continue to pour money into product development, which leads me to speculate that the company might have another blockbuster product in the works, perhaps the much rumored iPhone Nano. While others sell in panic on Steve Jobs’ leave notice, the time is right to jump in for a few shares. The fact of the matter is that Tim Cook was already handling day to day operations and has the ability to manage the company and make sound decisions just as well as Jobs. The upside potential is big.