NEW YORK (
TheStreet) -- For several years, investors bought
(AAPL - Get Report) shares for the growth prospect while I liked the numbers from a value point of view. Many rightly justified the purchases with explanations of removing the cash to calculate the true price to earnings ratio (rarely a smart idea without discounting the cash.)
During the last six months, I witnessed a shift from a growth thesis to a more investment thesis. I found it fascinating, because the more I read that Apple was a great value play, the more I started to think of it as a growth stock. It's almost as if many of the long bias followers and I are 180 degrees out of phase.
Often the gurus in the short bias group will point out that they think Apple faces shrinking margins and that Google's (GOOG - Get Report) Android based phones are gaining market share. To be fair, Apple may actually come under margin pressure, although last quarter is not a good example of it.Last quarter, Apple introduced several new products, and as someone who spent years manufacturing and importing products, I know the first quarter or two are the toughest ones from a profit perspective. If Apple launched as many products as they did without a margin hit, they unquestionably would be able to walk on water. Apple can't walk on water, but then again, they don't need to. Apple doesn't have a margin problem and if margins do shrink they still don't probably have a margin problem. Where else are you going to get a large tech company with Apple's margins? I will save you the trouble; you're not going to find another company with the wide margins Apple enjoys.
AAPL Profit Margin TTM data by YCharts