Apple stock safest tech stock, experts say

According to Gene Munster of wealth manager Deepwater Asset Management, Apple stock will likely be the safest tech stock over the next six months.

In an interview with the TV channel “CNBCon Wednesday, Munster downplayed the recent rise in the Nasdaq, which posted a 17 percent jump in the first two months of the year.

This movement is unlikely to continue for the next six months, Munster said. However, he believes Apple’s stock will be a safe haven in a market currently plagued by a banking crisis.

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“Apple is still probably doing the best job of any big tech company when it comes to weathering this storm,” Munster said.

Apple stock could benefit from plans with suppliers

He referred to Apple’s plans to increase spending on its suppliers. This could be reflected in a higher output. He expects the iPhone maker to beat industry growth forecasts of 1 percent.

“No company is immune, but I think Apple stock is probably the best bet for getting through at least the next six months,” Munster said.

This assessment comes after a tumultuous week for the market, which was overshadowed by the collapse of the Silicon Valley Bank (SVB) last Friday. Their collapse had triggered a sharp sell-off in other bank stocks. This increased the pressure on the US Federal Reserve to ease its tightening measures in order to avoid overburdening the financial system. Tech stocks, which came under pressure from interest rate hikes in 2022, could also benefit from this.

Inflation remains a key issue for the Fed

Amid the recent turmoil, markets have lowered their forecasts for the Fed’s next rate hike. They are now expecting a quarter point hike and expect rate cuts of up to 100 basis points by the end of the year.

Nonetheless, inflation would remain the key issue for central bankers. Munster said they would likely not raise interest rates again until the labor market calmed down. That means tech stocks could face more trouble in the first half of the year.

“I wish there was more optimism,” he said. “Glad to hear about a possible pause in rate hikes. In terms of investing in tech stocks in the short term, this could be a bit of a fallacy.”

Munster has called Apple “one of the greatest companies in the world.” He praised the company as a beacon in the technology sector. Previously, he said that Apple stock has a true value of $250 per share. That would be more than 60 percent more than the current price of 153 dollars (143 euros).

Disclaimer: Stocks and other investments are always associated with risk. A total loss of the invested capital cannot be ruled out either. The published articles, data and forecasts are not an invitation to buy or sell securities or rights. They also do not replace professional advice.

This text was translated from English by Jannik Rade. You read the original here.

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