Apple, Facebook and RIM: Three Paths, One Destination
Moustafa is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Three companies that have taken very different paths have arrived at the same point in early 2013. They are all looking very attractive to investors right now.
After Apple (NASDAQ: AAPL) posted its first quarter earnings report the stock plunged 12%, and investors big and small shuddered at the possibility that the six-year growth story has finally come to an end. In the meantime, two companies who have been more hated then any two tech companies in recent memory have seen incredible gains over the last 6 weeks. Facebook (NASDAQ: FB) was the victim of lawsuits and negative press after their much-anticipated IPO tanked. Research in Motion (NASDAQ: BBRY) has been left for dead for the last two years, their handsets deemed obsolete and their only option to sell what remained of the company. Now both seem to be getting their proverbial ducks in a row and are setting up for what could be a huge 2013. All three pose attractive potential investing opportunities.
Facebook comes of Age
Facebook rolled out their big news of the New Year with their release of their graph search. The graph search is an update to Facebook’s long outdated search function allowing a slew of new search abilities that will help users to search their friend base much more in depth. Though initially the market responded with little enthusiasm, what many missed is how important this new tool will be to Facebook moving forward. The main issue that initially crushed the share price of FB post-IPO was the fear that they would not be able to properly monetize their user base and make the switch to mobile. The graph search function is a major step into monetizing not only ad revenues but creating even more user interaction within the Facebook ecosystem. It will blend perfectly into the mobile evolution of the Internet. Though hard to picture today, Facebook could in the not-so-distant future be competing head to head with Google.
RIM is back
Research in Motion has seen their stock increase over 100% in the last two months, all on anticipation of the release of BB10. Thorsten Heins has demonstrated an ability to navigate the company through some of the darkest waters any tech company has had to face recently. Now with the release of the new BB10, RIM is poised to bring its Blackberry handsets back to relevancy in North America. If not relevancy, it will bring it to the point where it will be sold for a premium. In both cases recent investors will be rewarded. The beauty of RIM at this point is the fact that with a comparable handset line, their patents, and network, the company has many different options moving forward. There is an excitement surrounding RIM that was once reserved only for Apple.
Apple Falling out of Favor but not to Far
Though Apple beat many of the estimates in its first quarter report, the slowing sales of iPads and iPhones caused investors to jump ship. This seems very overblown, as little has changed in the fundamentals of the business, and they have enough cash to purchase Greece. Apple is one product away from wooing back all those who have begun to say the growth story is over. Though the iPad and iPhone will follow the path of all products through their product life cycle that does not mean Apple is done innovating great products. As they were not the first to produce MP3 players, nor were they the first to produce smartphones, they have made a business out of putting their spin on products that are already in the market. They make them better, cooler, and market the heck out of them. The Apple T.V. is something that has been swirling through the rumor mill for quite some time, and could be exactly one of the products that puts Apple back into another growth cycle. This is combined with the fact that it has been reported that when Steve Jobs passed away he left behind a slew of products that will be rolled out over the next couple years. With the most recent pullback Apple looks very attractive for a long term investor, though it seems things will be rocky in the short term.
Three is a Charm
Apple may have hit a rough patch in regards to investor confidence. This can cause some short term buying opportunities, as it is trading near 52 week lows, but in the long term Apple still looks like a great investment. FB and RIM have been left for dead over the last year, but are poised to pop in the short term. RIM in particular may be the target of a buyout or partial purchase after their release of BB10. FB is poised to be a long-term multi bagger and could easily be on the same path Apple had been on over the last six years. FB, RIM, and Apple are all in a good range for investors today. Each provide an opportunity for a run up in 2013.
mooseelz owns shares of Apple, Facebook, and Research in Motion. The Motley Fool recommends Apple and Facebook. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Is this post wrong? Click here. Think you can do better? Join us and write your own!