Paul Graham's stock pick, March 2005

[jaydub]

I was looking at an old essay, "Return of Mac" where pg discussed the reemergence of Apple.

"So Dad, there's this company called Apple. They make a new kind of computer that's as well designed as a Bang & Olufsen stereo system, and underneath is the best Unix machine you can buy. Yes, the price to earnings ratio is kind of high, but I think a lot of people are going to want these."

Have a look at the stock prices of Apple, Google, and Microsoft between then and now: http://preview.tinyurl.com/23a4vd , that's a pretty solid call

[ssharp]

AAPL experienced significant growth during that 2005-2008 stretch. Volatility comes with the growth. Anyone investing in AAPL during that time should have been buying with the intention to hold and realize the returns on the grwoth. My biggest regret with AAPL was not buying more of it when I got my first Powerbook is late 2003.

The 2008 decline was a factor of questions exponentially raised into panic (by the current economic conditions) about the iPod's sales growth as well as the iPhones ability to gain market share. Even with those questions, it's still a stock worth holding onto and buying more of. That stock dropping to 119 recently was an absolute joke. Once the stimulus checks start going out, iPhone apps take it to the next level, and the the 2nd gen. iPhone with 3G hits shelves, AAPL will be back around 200 -- probably sometime in July.

[aston]

Volatility is one of AAPL's trademarks. Had you bought in January '05 , you were already at a decent loss halfway through the year. Same sort of big loss from the beginning of 2006 to halfway in. Not to mention the huge drop since the beginning of this year.

Had you had the balls to buy and hold AAPL these 3 years, you'd be happy, I guess, but with a few years off your life worrying whether they'd rebound. Meanwhile, MSFT has been pretty steady, all along paying dividends...