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Why Investors Should Be Cautious of the Pessimism in the Markets

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Let's take a look at one high-quality name right now, Apple (AAPL)

TheStreet's Jacob Sonenshine and J O Hambro's senior fund manager, Giorgio Caputo, joined TheStreet to discuss Apple and Caputo's advice when it comes to finding opportunities in lower-volatility stocks.

"Well, there've been several reasons. So one of late, it's become pretty clear and we'll see in the December quarter that iPhone 11's are selling really well. 5G cycles expect to be pretty good in 2020. Those are some nice things and another nice thing is that there's been trade optimism that's powered the entire market. But the most important thing, and it became really, really clear in Apple's last quarter, investors are finally starting to appreciate the fact that services are going to soon account for over half of the company's earnings. They are higher growth for now for the next several years and they're much higher margin. That's why you're seeing Apples multiple expand around 20 times forward earnings. And so that's been the most important thing for the stock," said Sonenshine.

Watch the full video for Caputo's advice. 

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