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Federated Investors senior vice president Phil Orlando gives his outlook for Apple and tech stocks.
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Well the good times keep on -- for after all of the tech giants had the record for the most valuable public company.
At 624 billion dollars the stock.
Is on the has been up again today and but hesitate joining us now to answer that Phil Orlando senior vice president chief equity market strategist.
At Federated Investors and we'll put you on the spot.
People have been saying this for -- very long time and do would you get out of it here and we.
In the interest of full disclosure apple is a stock that we own and it's been one of our favorite stocks.
This company has a history of being one of the most innovative companies that we've invested it.
And and it's had a tremendous run even this month the stock's up about fifteen or 20%.
But let's take a step back and look at the bigger picture.
Over the course of the next year.
We're expecting new -- out of both the iPad and the iPhone and we think that we're gonna see some apple TV at some point over the next twelve or eighteen months as well.
As well as the stock is dawn.
It's only trading at about fourteen and a half times earnings compared to the S&P at thirteen and a half times or -- You've got a growth discrepancy.
Such an apples growing its earnings and about twenty to 23% the S&P at about six or 7%.
So on that basis.
You're trading at a very naral premium to the S&P we think something close to a 30% premium is is appropriate so could we see a pullback given this very strong one we've seen near term absolutely over the next -- -- so.
Something in the 75760.
Neighborhood certainly makes laws silence broadly do you like technology stocks we get.
Technology is one of our favorite areas along with consumer discretionary in financial services.
Because we expect that the economic soft -- we saw on the second quarter is temporary.
And we're starting to re accelerate out of that and technology -- a sector we think is one of the groups that's gonna perform well as the economy begins to look -- Consumer discretionary even with gas prices going back up even with as a country where -- facing a record annual price this year.
Well certainly the that the spike in gasoline prices and food commodity -- to -- watching very closely.
Understand that as the situation on Iran unfolds if if that situation gets resolved diplomatically.
You're gonna have something in the order of sixteen million a -- and barrels of crude floating market which would reverse this temporary spike that we've seen that they might actually placing known as well I mean you're betting on -- -- -- Iranian regime not -- -- to be reasonable did did the reality is the gasoline prices right now -- -- may be about -- gallon nationally are -- and they -- over the summer but they're not.
Poisonous they're not at the point -- little choke off consumer spending.
However if we can get some relief at the pump certainly -- if we can get some improvement in food commodity prices over the course of the next year or so that will.
Essentially serve as a tax cut for consumer -- -- it's great to say thank you are not much Phil Orlando with Federated Investors and by the way on the -- Apple Stock is down we had it up on the strains on but it's down.
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