BALTIMORE (Stockpickr) -- When Apple (AAPL) released its second-quarter earnings last week, shares rocketed higher on the results. Not only did Apple make money hand over fist for the quarter, but the firm also announced a massive $130 billion capital return program.
But after the pop, it didn't take long for Apple bears to chime in on why now is the time to sell take those gains. But are they right? Is it time to sell Apple now?
Not even close.
The very best reasons to sell AAPL are total bunk. Today, I'll show you why now is a great opportunity to add onto an Apple position -- not to unload shares.
This isn't the first time I've chimed in on Apple. And so I'll share my standard disclaimer: I own the stock. I'm not an "unbiased" journalist -- I'm an investment professional, and I'm talking my book. But that still doesn't make anything I'm about to say any less true.
Without any further ado, here's why the bears say you should sell Apple -- and why there are actually good reasons to buy more.
1. Apple Can't Innovate Anymore
Searching for the phrase "Apple can't innovate" returns a whopping 104 million results on Google. It's been one of the chief criticisms of Apple for the last couple of years.
And it's a fair concern.
After all, the last "blockbuster" product that Apple released was the iPad, which came out way back in 2010. We've been sitting through a long stretch of incremental upgrades and updates without a big new device release. But that's not out of line with Apple's previous new category launches: There were three years in between the iPhone's 2007 launch and the iPad's 2010 debut, and another six years back to the introduction of the iPod in 2001.
That haphazard release timeline is the result of a product lifecycle that's driven by innovation rather than some sort of marketing calendar. And yet somehow, it's out of the ordinary that one of the most secretive tech companies in the world hasn't pulled back the curtain on their next big launch?
Apple's historical launch timeline also jives well with Tim Cook's comments about Apple getting closer to entering a new product category in 2014. Consider this: If you'd sold Apple four or five years after the iPod was released, you'd have missed out on the iPhone because "Apple wasn't innovating anymore."
Even if new things are on the way, there are still some real concerns about sluggish innovation hurting market share in existing categories, such as the iPhone. In the last year, Apple's share of the smartphone market slipped from 17.5% down to 15.3% according to data from Strategy Analytics.
And that's a real cause for concern -- if you don't understand Apple's business.