“What goes up, must come down, ” Sir Isaac Newton laid down the principles to understanding gravity after an apple fell on his head, according to the popular legend. Wall Street was waiting to see the laws of gravity play out in Apple’s stock, and thought the stock was simply following natural and economic laws as it saw some dips. The stock fell below the crucial $108 mark, but rallied to $112.45 right after Carl Icahn explained his long position in the stock, and said it was a “no brainer” on a CNBC interview.
Carl Icahn raised his stakes in the company, even as the stock had fallen despite reports of strong holiday sales. The billionaire hedge fund manager doesn’t see Apple dropping to the ground any time soon, and thinks it will continue to dominate smartphones, despite competition, because it has a superior product.
He told CNBC, “Apple is my favorite stock. We did well with it. I think CEO Tim Cook is doing a great job. It doesn’t mean it is not going to go down, but I do think it is a no-brainer.”
The iPhone 6 is enough reason to believe in the stock, but regardless of Wall Street skeptics, Icahn thinks the iWatch will also be revolutionary. Icahn added, “You are in a company that is in the greatest growth industry in the world, with part of an oligopoly if not a monopoly. I think in the industry they are in, it is extremely difficult to compete with them. They can continue to take more market share as they are a great ecosystem.”