Apple Is Blowing Minds Again by How It's Using Its Cash

Date | 14-12-2017 - 12:11 PM Article Type | Stock Markets Region | United States

ByBrian Sozzi
Dec 13, 2017

Look what Apple is doing: Unsure why nobody is talking about this, but they should be: Over the course of one week mighty Apple (AAPL) has spent a reported $400 million to acquire music tech company Shazam, while Wednesday brings news that Apple has invested $390 million in laser chipmaker Finisar (FNSR) .

In effect, Apple has signaled a few things to the market. First, it will need help to engineer the next groundbreaking product. This doesn't mean Apple is done innovating, it means Apple realizes that to stay ahead of strengthening rivals it must use its biggest advantage -- its balance sheet. Can't wait until Apple buys Salesforce (CRM) to take on Microsoft (MSFT) and Amazon (AMZN) in the cloud.

Another aspect is that tech valuations may not yet be frothy despite a year of big gains for FAANG (Facebook (FB) , Apple, Amazon, Netflix (NFLX) and Alphabet (GOOGL)) and various robust valuations on tech IPOs. From a pure investing standpoint, these are favorable signals. Thanks Apple! Surely, Apple investor Warren Buffett is happy about all of these things. 

Author: Heng V. Mony
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