Apple stocks

Never try to catch a falling knife means that a stock or index should not be purchased while it is falling (decreasing in value), but rather should be purchased when it bounces off its lows and begins an upward trend (increasing in value).

Making money in the stock market was difficult in year 2022. Apple shares have had a rough start to the new year. Apple appears to be experiencing bottlenecks in a number of projects, and also other external factors have recently increased volatility in the stock. Apple is currently trading near a 52-week low and is down roughly 30% from its all-time high. Nonetheless, despite the sell off, Apple continues to outperform the other FAANG companies.

The most plausible explanation for Apple's stock decline is that its business faces numerous challenges in 2023. In retrospect, the pandemic clearly increased demand for consumer electronics. Given its slowing growth, it's understandable that investors would not want to pay or invest too much in the current market. Apple stock deserved to fall, but it is now trading at a price that is appealing to long-term investors.

In the past, Apple used its large cash reserves to buy back its own stock and reinvest it in the business. This time, it may be under pressure to use free cash flow to pay down debt rather than buy back its own stock. Furthermore, the company's growing debt position comes at a time when interest rates are rising and consumer demand is weakening.

Given the reasons stated earlier on, it is understandable that Apple stock has dropped. However, given the recent sell-off and the Apple’s fundamental strength, now may be a good time to begin dollar cost averaging (DCA) into Apple stock.

Investments are subject to investment risks, including the possible loss of the principal amount invested. Remember to DYODD (Do your own due diligence) when making any investment.