Apple Inc. (AAPL) – To Be or Not To Be?

Apple’s shares began to rapidly lose altitude while Google’s shares started to gain strong momentum. As Google’s share price hits $900 for the first time, Apple’s free-fall continues. It is hard to ignore the coordinated movement in opposite directions occurring almost simultaneously. Money is being pulled out of Apple and poured into Google. I strongly believe that large hedge funds are responsible for this correlation, but it is difficult to provide a definitive proof for this assumption.

While most of the market’s attention has been given to Google and Apple, one of its most important competitors is coming back under the radar. Shares of Microsoft Corporation (NASDAQ:MSFT) have been up more than 30% this year.

Microsoft has maintained a superior business over three decades. When the two giants have gone head-to-head, however, Microsoft has come off worse. In tablets, music players and smartphones, Microsoft lags behind. On the other hand, Google’s Android is clearly crushing both Apple and Microsoft in the mobile device market. It’s putting the squeeze on Microsoft Corporation (NASDAQ:MSFT) as well as on Apple, which sparked the smartphone and tablet revolutions in the first place.

The similarities between Apple and Microsoft also lie in management and leadership. Steve Jobs was the ultimate visionary leader, and without him Apple looked more like a sheep without a shepherd. Microsoft experienced a similar phenomenon; when founder Bill Gates stepped down, the company was looking for a new direction with Steve Ballmer. It took a while, but it seems that Microsoft is finally back. I certainly believe that soon enough Apple will hit paydirt again as well.

The foolish bottom line

I strongly believe that the sharp decline in Apple’s share price is temporary. From a long-term perspective, the company is financially solid and has repeatedly proven its strong reputation for creativity. In addition, the above combined with a high dividend yield makes Apple a strong buy. Therefore, the big Apple is poised for a comeback.

Yaniv Hirsch has no position in any stocks mentioned. The Motley Fool recommends Apple and Google. The Motley Fool owns shares of Apple, Google, and Microsoft. Yaniv is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

The article Apple – To Be or Not To Be? originally appeared on Fool.com is written by Yaniv Hirsch.

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