The world’s largest company sees shares slump 7 per cent

By Tahmina Mannan News of the day, FE Tips

Updated on Monday, 24 August, 2015

 

 “Yesterday’s sharp vertical drop in Apple’s share price will obviously concern investors with any substantial exposure to the tech behemoth. Shares in the California-headquartered multinational firm slid around 7 per cent in afternoon trading following its latest quarterly results.

 

“The shares dipped due to the Q3 figures failing to live up to investor expectations, despite profits being up. Revenues for the three months ending June were up 33 per cent to $49.6bn, just ahead of analysts’ forecasts. Earnings were up 45 per cent – making that the ninth consecutive quarter that Apple has exceeded estimates. Net income grew 39 per cent to $10.7bn.

 

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“There were also concerns over Apple’s ability to weather the recent volatility in the Chinese markets – and what that could mean for Apple’s biggest consumer base - and the fact that the company did not disclose the anticipated sales figures for the Apple Watch.

 

“Given that Apple is the world’s largest publicly traded company by market valuation, the notable dip in the share price wiped off as much as $66bn in value at one point. Apple also has the largest weighting of any company in the S&P 500 – so investors holding a tracker following the US benchmark will also be feeling the pain.

 

“Due to Apple’s prominence in the global market, this latest dip in share price will no doubt fuel many analysts’ column inches, but for some investors it may be a time to take stock on whether the price slide is a time to buy.

 

“For investors looking for exposure to Apple, but within the relatively safer confinements of an investment fund, CIS Sustainable World is one option.

 

“Apple makes up 2.8 per cent of the fund’s holdings and sits in its top ten holdings, although investors should note that there are other funds with higher levels of exposure to Apple.

 

“CIS Sustainable World, recommended by the FE Research analysts as part of FE Select 100, invests in a mix of equities and bonds – managed by FE Alpha manager Mike Fox.

 

“Fox aims to identify mispriced companies that meet both investment performance but as the name suggest the fund has a clear socially responsible objective. With this in mind – Fox immediately excludes companies involved in armaments, nuclear power generation and tobacco.

 

“The fund has returned more than 55 per cent over the past three years, and more than 86 per cent in the past five, beating the IA Mixed Investments 40%-85% sector by more than 17 and 27 per cent, respectively.

 

“The fund has been awarded four FE Crowns, and has an FE Risk Score of around 77 at the moment (0 is cash, while the FTSE has a risk score of 100). Investors should aim to hold the fund for at least five years.”