Apple's Original Investors Are Now Among the 1% – ValueWalk Premium
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Apple's Original Investors Are Now Among the 1%

Apple's Original Investors Are Now Among the 1%

For many Apple Inc. (NASDAQ:AAPL) loyalists, they not only show their love for the company by purchasing the latest iPad or iPhone, but they are holding on to the company's stock for the long-term.

In the last year, Apple's share price has jumped more than 77 percent. For long-term investors such as Anton Marinovich, his $1,000 investment 17 years ago is now valued at over $240,000. With Apple's new dividend plan, he could see an additional $1,000 each quarter.

Marinovich, 35, said of the investment, “It's pretty bananas. I always hear about all these people here in Silicon Valley falling into huge luck, but I never thought it would happen to me.”

In addition to his 400 shares of Apple, he owns with his fiancee two iPhones, two MacBooks and an iPad.

Investors such as Marinovich purchased the stock years ago when its share price sat in the double digits. They kept the investment because they loved the company and the products it produced. Their loyalty has been rewarded with a $600 share price and a hefty future dividend payout from Apple's $100 billion mountain of cash.

According to Reuters, after interviewing close to two individual Apple shareholder, many said they plan to keep the stock and its upcoming dividend payout. They won't be cashing out on the stock to take elaborate vacations.

Investment Provides a Safety Net

But it doesn't mean that the Apple investors aren't spending any money. Marinovich said his Apple investment gives him some freedom to spend; he recently purchased a $2,000 Omega watch and plans to upgrade from his Volkswagen Jetta to a new Audi.

On the other side of the coin, retirees are also enjoying their Apple windfall. At 79, retired nurse Pat Harshbarger saw her $13,800 Apple investment increase to $46,000. This has enabled her to take trips to visit her family and enjoy some fun in Las Vegas with her husband.

Another investor plans to keep buying more Apple stock. Stan Merkin, a retired 71-year-old computer programmer, saw his portfolio rise about $100,000 from a late 2011 Apple purchase. He plans to buy an additional 50 shares should the stock reach $650.

Merkin said, “What I have made in Apple gives me comfort about how I can live in retirement.”

Sentimental Value

After watching the dot-com and financial busts, some 30- and 40-something Apple fans keep the stock because they feel it is the responsible thing to do.

Nate Landau, 38, has been a victim of the dot-com bust, working at eight companies, predominately technology ones, since 1996. His attachment to Apple goes back to his family's first Apple computer at age 10.

Landau said, “I just remember using Mac Paint and really being blown away.”  He first invested in Apple a dozen years ago with $15,000. It has grown to $60,000 even as he sold 2/3 of his initial investment.

Kristi Faulkner, 44, had a similar memory of her first Apple computer, a Mac Classic, in high school. She said, “It had this little, tiny four by six screen and it was the coolest art tool I had ever seen.”

Between Faulkner and her two daughters, they are an Apple-saturated family: they have two Mac desktops, three MacBooks, two iPhones and numerous  iPods, iTouches and nanos.

She has a strong connection to Apple's stock, saying, “Apple made computers accessible to me as a girl and as an artist. If it dives tomorrow, I am not selling.”

Financial Advisers Express Concern

Is this attachment to Apple always a good thing? Financial advisers have expressed a little concern. They don't want the groupies to get stuck and have regrets when they're ready to sell.

Last year, Faulkner had her total savings tied up in Apple and Google. Her adviser wasn't happy and suggested that Faulkner sell it. While she did trim her investment, Faulkner, who started investing in Apple back in 2005, has made greater than $82,500 in the stock.

Jeff Gonzalez, a 31-year-old similarly made his Apple investment in 2005, also battles with his financial adviser. He said, My broker is constantly calling me to tell me to sell it. Every week I call him up and say ‘Look you are wrong, it's gone up again'.”

With his almost seven-year-old investment, he's gained $16,500.

For Apple investors with a background in the financial industry, they are also not so objective about their Apple investments.

Matt Reiner, a 25-year-old financial adviser, knows better. His 40 shares of Apple has grabbed about $11,000. He said, “There is so much euphoria around Apple, but it's very hard to sell a stock which seemingly has its products in everyone's hands.”

The Next Generation

So who's missing from this wealth of Apple investors? The 20-somethings. With the current economy, many are investing in Apple products rather than the stock. It's cheaper and many are more interested in the short-term than planning for their futures.

This group will also likely find the next Apple to invest in and see their own riches. But the question for everybody is, “What stock is that?”


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