Apple Inc. (NASDAQ:AAPL) on Tuesday closed at US$625.63 per share, up $11.50 or 1.87%, a 19-month high for the consumer electronics giant. In light of this significant movement in the iPhone-maker’s stock, CNBC’s Michael Yoshikami and Kate Kelly talk over why the tech giant is returning in a big way.
In the video below, Kelly asked Yoshikami why Apple Inc. (NASDAQ:AAPL) has rallied and whether or not this is connected to news that the company’s planned acquisition of Beats Electronics for a massive $3.2 billion is unlikely to push through.
Yoshikami said that this is not the case. The rally is more likely because of a recent rumor that Apple is targeting the home automation front, he said.
Recently, the Financial Times reported that sources have told them that Apple Inc. (NASDAQ:AAPL) plans to debut its home automation platform with the iPhone as its core device in a keynote on June 2. According to this report, the new platform will include a new Apple TV, which will be unveiled later this year, as well as the promise of letting users seamlessly control home appliances such as lights, security systems and the like.
Furthermore, Yoshikami said that Apple Inc. (NASDAQ:AAPL) has rallied because of positive news that have been driving its price up amid the negative sentiment people have about the stock. He said:
“I think that Apple as a stock has been so hated and so unloved for so long. Any positive news at this point […] makes them swing the other way.”
Kelly countered saying that the Cupertino, California-based behemoth may not be as unloved as Yoshikami suggests because a lot of people still hold stocks of the company. Yoshikami answered by saying that just because a lot of people still own stocks of the company does not mean that they love the stock. He points out some stock owners saying that they hate the stock because it once breached the $700-mark and has gone down significantly since then.
The team then goes on to talk about how unrealistic expectations about Apple Inc. (NASDAQ:AAPL) stock have become in the past and whether or not the company still has it in terms of innovation.
Watch the video below: