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BlackBerry and Apple Are Down, But Only One Is Out

Stocks in this article: BBRYAAPLGOOGSBUXMSFT

Apple can't release an Earth-shattering, groundbreaking new product every year. Despite what investors want, it simply can't happen. But beginning in October and over the following 15 months, we're going to see a slew of new products and I will wait to pass judgement on Cook until then.

Thorsten Heins is another story.

Getting back to the battle of the stocks, Apple makes such a better investment, in my mind. People love Apple products. When you walk around to, say, a Starbucks (SBUX) or bookstore, do you see PlayBooks and BlackBerrys everywhere or iPads, Macs and iPhones? I think the answer is rather obvious.

The Apple ecosystem is only continuing to increase, with the number of current iOS devices estimated to increase from 346.5 million devices in 2012 to over 570 million by 2017. The 65% surge is far more than the horrendous 30% decline that's expected for BlackBerry over the same period.

With new, innovative and, most important, successful products, why choose the loser? Apple has a plethora of cash, to the tune of $146 billion. Although using it to buy back $60 billion worth of stock and shell out $3.05 per share in quarterly dividends is arguably not the best way to use it, the tech giant has more than enough to spend on acquisitions and research while maintaining its plan to return cash to shareholders.

Here's my gripe: BlackBerry bulls continue to argue that the stock can only go so low until it trades at the same level as its cash. Well, my friends, that's at about $5.86 per share, or another 35% downside before that level would be hit. Apple bulls made that argument, too. The difference is, Apple's products remain in demand.

I recognize that Apple has certainly had its flaws over the past year, but it's where I would (and have) put my money between the two companies. With both stocks down close to 20% on a year where the S&P 500 is up over 18%, I'm going to bet that the successful one is going to continue being successful.

The smartphone market is crowded and the big players in it are likely going to continue being leaders. Names like Google, Samsung and Apple are the juggernauts. Companies like BlackBerry and Microsoft (MSFT) are among those that are not.

Recent events, such as pitiful earnings results, price reductions and product flops (mainly the PlayBook tablet) make BlackBerry hard to own. Apple has had its missteps, too. But given its much brighter future, high product demand and new products coming to the market over the next 18 months, I think I'll put my money on the latter, rather than the former.

At the time of publication the author had a position in AAPL.

This article was written by an independent contributor, separate from TheStreet's regular news coverage.

Bret Kenwell currently writes, blogs and also contributes to Robert Weinstein's Weekly Options Newsletter. Focuses on short-to-intermediate-term trading opportunities that can be exposed via options. He prefers to use debit trades on momentum setups and credit trades on support/resistance setups. He also focuses on building long-term wealth by searching for consistent, quality dividend paying companies and long-term growth companies. He considers himself the surfer, not the wave, in relation to the market and himself. He has no allegiance to either the bull side or the bear side.
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