There's No Good Reason to Own Apple Stock

NEW YORK (TheStreet) -- I always thought investing was about making money, not proving a point.

When we discuss the notion of emotion in investing, it's about more than cheerleading for a stock or averaging down on a dip in a misguided attempt to save a position. It's as much about losing sight of the reason why you invest in the first place.

When you take that perspective, it renders Apple ( AAPL) a stock not worth owning, at least not to a level approaching anything that resembles a core position. Why step in front of the train of negative sentiment and uncertainty? There's no good reason.

In January, I made an appearance on CNBC's "Fast Money" program where, afterward, viewers claimed the experienced panel schooled me. I have no problem admitting that nervousness and anxiety, at times, get the best of me. But, it's imperative to point out my primary takeaway that day: Do Not Buy Apple Ahead of Earnings.

At the time, one of the Fast Money panelists told us that "in the short run Apple could go to $550." Another countered my contention that cost basis matters in buy/sell decisions. In retrospect, it's a shame my jitters -- and their aggression -- prevented me from getting my take across clearly.

Here's where I stood on AAPL back then:

Two out of three ain't bad, Meatloaf.

Horrible stock for long-term investors to hold. Check.

Too much anxiety surrounding the stock. Check.

Give Apple some breathing room for CEO Cook to gain footing. That's where I have since shifted opinion.

I hold out hope that Tim Cook can deliver results with true innovation sometime before the end of the year, however, I fully realize it's a fairy tale to think it will go down that way. As Springsteen riffs, There ain't no storybook story/There ain't no never-ending song. Chances are Tim Cook cannot duplicate Steve Jobs' success. That much has become clear, albeit sadly.

We'll be talking about Tim Cook losing his job as Apple CEO before we're wowing over a new piece of hardware that rivals iPod, iPhone or iPad.

I might be wrong. I might be right. Opinions range and rage all over the place . . . wildly.

This is the embodiment of an uncertain, emotion- and psychology-driven battleground stock. Why mess with it? If making money as an investor to pay for things such as retirement, your kid's college, a house, a car, a vacation, whatever is your goal, you're almost irresponsible to invest any significant amount of money in AAPL right now.

When you're dealing with dollars that matter to you and your future -- as an investor, a human, a spouse, a parent -- look for some level of certainty. That doesn't mean you take no risks. That doesn't even mean you don't own some collection of volatile and/or speculative stocks. But put some certainty in your core.

Not only should you limit your AAPL exposure; there's really no longer good reason to own any in the first place.

For more than the last year, I have touted the virtues -- and relative outperformance -- of media stocks, particularly big media companies. To a name, they undressed AAPL, which underscores two of my core themes:
  • Are you in AAPL for the right reasons? Or are you trying to prove a point to yourself or somebody else?
  • Look for a broad narrative of certainty and invest in stocks that are out front in telling that story.

    There's not a more certain space than big media. I get into the reasons why in the above-linked articles. But, in the shell of a nut, these are the guys that own and control the most premium media in the world. Intact narratives. Clear futures. Great balance sheets and capital structures, including, in many cases, dividends/buybacks. But not without the potential -- really the likelihood -- for massive growth.

    Yet many investors are still busy messing with Apple? It's a fun stock and company to follow, but a suspect investment choice. It's been that way for a while and will likely stay that way for the foreseeable future.

    -- Written by Rocco Pendola in Santa Monica, Calif.

    Rocco Pendola is TheStreet's Director of Social Media. Pendola's daily contributions to TheStreet frequently appear on CNBC and at various top online properties, such as Forbes.

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