Doug Kass Has 10 Reasons Why Investors Should Worry About Apple

doug kassDoug Kass

Photo: CNBC

Doug Kass, President of Seabreeze Partners, has a new post on RealMoneyPro titled The Bear Case For Apple.”The upcoming quarter will be big for Apple,” writes Kass. “The fastest ever rollout for iPhone 5 will be accompanied by higher-than-expected margins, as there are two separate cost-reduced models now. Soon everyone will know that, and if not fully in analyst numbers, it will be in buy-side expectations.”

Having said that Kass offers 10 concerns he has about the stock. We summarize four of them here:

  • “Quality vs. price: Apple is now selling less or equal for more money.” Kass argues that competitors have caught up with Apple in terms of technology.  As such, they are now only offering a similar or worse product at a premium price.  Kass doesn’t think this is sustainable.
  • “The Oracle of Cupertino: Steve Jobs is no longer around to convince consumers that his products are magical.”  Kass notes that there appear to be internal disagreements, and that Apple lacks a clear voice.
  • “Increasing product homogeneity: Apple no longer has a huge ecosystem advantage.” Most desired apps are available on competing operating systems.
  • “Economic headwinds: Some of the markets served by Apple are saturated, and in a worldwide economy facing strong headwinds, consumers may balk at a product that can be purchased at much lower prices from competitors.”


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