In recent weeks, there has been some concern over technology giant Apple [stckqut]AAPL[/stckqut] due to a slowdown in China, its fastest growing market. As a result, a number of Apple suppliers have seen their shares pull back a bit, including Skyworks Solutions [stckqut]SWKS[/stckqut].
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Shares have pulled back along with Apple.
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Business remains strong, margins improving nicely.
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Lower share price means higher dividend yield and stronger buyback.
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Valuation seems a bit depressed considering expected growth profile.
Should we really consider Apple, Skyworks, etc. when China’s economy is so unstable?
Zack – I am, in essence, a momentum investor. Right now, Apple and Skyworks are not momentum plays so I am not suggesting that you increase your investment in those companies. However, I feel that Apple and Skyworks are significantly undervalued as I write this. Once I am confident that the momentum has shifted in the positive direction, I will probably consider adding more to my stake. The investment philosophy that I explain in my book, The Confident Investor, does have me in a very enviable position right now as all of the money that I have invested in Apple and Skyworks is “free” money and I GOPM (growing on other people’s money) so when the stock does start to grow, I will continue to be growing on other people’s money.