Buying AAPL - Apple, Inc.

What Does Apple Do?

Apple (AAPL) designs, manufactures and markets personal computers and related software, services, peripherals, and networking solutions.

The Bulls: Innovation, First Mover, and Gobs of Cash

Apple is one of the most innovative technology companies on the planet. And it has a rock solid, loyal following. It's had this loyal following since the battle against the early Windows systems in the 80's. Apple's Mac computers were almost always superior to those of Windows, but aside from a clever move to put Mac's in schools in the 90's Apple has lagged behind the marketing prowess of Microsoft and Windows.

Today, not only are Apple's increasingly powerful and stylish computers slicing away at the market share of competitors HP and Dell, but so are the rest of Apple's products - just look at the line of fans wanting to get their hands on the latest iPhone release.

The Bears: Stiffer Competition, Cheaper Alternatives

Apple faces too much competition from alternative brands that are open to third party development. As the quality of alternative products increases, and they become ever cheaper, it will become more and more difficult for Apple to defend its commodity branding and 1st party sales. It's true that Apple's computer segment has opened up in the sense that the hardware is no longer all proprietary. But the iPod, iPhone, and other gadgets are relying solely on branding power. Eventually, competing companies will release products that can be extended by third parties to a degree that Apple can't keep up with. Sure, Apple will still have total control over its products, but no one will be paying the premium to own them anymore.