Apple's Allure Just a Barroom Fantasy

NEW YORK ( TheStreet) -- We have all been in this situation. Especially those of us who grew up a stone's throw from what they call the "Canadian Ballet."

You find yourself in one of these taverns where attractive women disrobe after a salacious introduction from a guy who kept Casey Kasem posters on his wall as a child. With Motley Crue cranking and beers flowing, you're feeling good. One of these ladies approaches you and, in no time, she's telling you that you look like a movie star. Whispering in your ear. Letting you know she wants you.

Of course, it's her job to take your money from you so she'll say just about anything. Here's where the Apple ( AAPL) analogy comes in.

The smart guys take what she's giving and walk away with no illusions. The guys who end up emotionally scarred at some point in their lives keep coming back. They buy into the notion that the things these girls in bars say to them represent a reality somehow lost on most of the rest of the female population. It's a recipe for financial and psychological implosion that helps illustrate what happens to investors in situations such as the one AAPL presents.

If you're a long-term investor, you cannot consider this run in AAPL real. That's dangerous.

Tim Cook tantalizes with a pumped-up dividend and buyback. The stock rises. That's the equivalent of sweet nothings whispered in an ear that requires validation. Granted, the move sets AAPL up as one type of stock for the long haul (nice value, great capital return and a floor thanks to a rock-solid balance sheet and present dominance), but don't allow the return of absurd price targets to pull you in.

Keep throwing money at AAPL and you might wind up in the same situation traders and investors were in at $704, a time when so many considered $1,000 inevitable. Remember how painful that was. It absolutely can happen again because, at day's end, this dividend/buyback move is a temporary Band-Aid solution to larger long-term concerns.

Let's hope Cook's move to prop up AAPL stock doesn't return the elephant to the corner of his room. I know AAPL fans like to shoot messengers, but we were better off when we talked openly about the elephant.

Don't lose sight of what really matters, over the long-term, at Apple. Can Tim Cook pick up the innovation and the new product pipeline where Steve Jobs left off? That's the question.

It amazes me -- based on the Twitter flow and recent articles, particularly here on TheStreet -- that so many people are willing to uncritically associate this move to return more capital via a debt offering with the notion that Apple's Worst Days Are Finally Gone.

First off, the worst days are not here. We saw them somewhere between Steve Jobs's first and second tenures at Apple. Remember, Apple remains the dominant force in the hearts and minds of people who spend considerable amounts of money to buy computers, tablets and smartphones.

It's still not clear if the worst is yet to come. The last few days have done absolutely nothing to shed light on that most important question. If you think they have, you really will believe anything she (or a whimsical market) tells you.

-- 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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