Shares of the consumer tech giant Apple (NASDAQ: AAPL) had blasted over 11% higher, as of 1:55 p.m. ET today, after President Donald Trump announced a 90-day pause on higher tariff rates for most countries and a universal 10% tariff base during the pause, citing progress on negotiations, according to CNBC. The rebound follows one of Apple's worst four-day stretches of trading since 2000.
It's all about tariffs
President Trump's surprising tariff announcements last week sent Apple shares into freefall. Shares sunk over 18.5%, shedding some $770 billion of its market cap at the trough of the fall. Apple is believed to be one of the worst-positioned stocks in the "Magnificent Seven" due to all the revenue it generates and products it makes in countries like China that have been looking at steep tariffs.
While some countries will see a 90-day reprieve, Trump said he would leave high tariffs in place on China and actually raised them to 125% due to the "lack of respect that China has shown to the World's Markets." The U.S. government also had a successful Treasury auction, alleviating some near-term debt concerns and sending stocks positive.
Goldman Sachs Managing Director Sung Cho also recently appeared on CNBC and essentially called the sell-off of Apple an overreaction. Cho believes investors are underestimating the company's pricing power, fortress balance sheet, and "flexibility in its supply chain."
Still one of the biggest and brightest
If the trade war with China is long-lasting, Apple still has many challenges ahead to navigate. However, this recent news at least gives investors some confidence that Trump is willing to negotiate. Given its strong brand power and balance sheet, I think you can buy Apple stock on a long-term investing horizon.
Don’t miss this second chance at a potentially lucrative opportunity
Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.
On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:
- Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $249,730!*
- Apple: if you invested $1,000 when we doubled down in 2008, you’d have $32,689!*
- Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $469,399!*
Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.
Continue »
*Stock Advisor returns as of April 5, 2025
Bram Berkowitz has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple and Goldman Sachs Group. The Motley Fool has a disclosure policy.
