Don’t bet against Apple, says tech investing legend Alan Patricof

Posted at 12:41 PM, Jul 09, 2019
and last updated 2019-07-09 14:41:30-04

Investors are debating whether or not Apple’s best days are behind it. But one top venture capitalist thinks it would be a mistake to doubt the iPhone maker.

Alan Patricof, the co-founder and managing director of Greycroft LLC and early backer of Apple, Office Depot and AOL, told CNBC in April that Apple’s move into health care and other services open up so many new revenue streams for CEO Tim Cook.

“I wouldn’t bet against Apple,” Patricof said.

Patricof will talk about Apple, the rest of the tech sector and the IPO market with CNN Business editor-at-large Richard Quest on the “Markets Now” live show Wednesday at 12:45 pm ET.

Apple is a great stock for the long haul

Patricof is still bullish on Apple, arguing in a recent Fox Business interview that its exposure to China — despite trade concerns — is another growth opportunity.

Apple is a stock “you want to own for a long time,” he said, adding in the Fox Business interview that he wished he had never sold any of his shares in the company. Patricof said the $300,000 his firm invested in Apple 40 years ago would be worth about $3.5 billion today.

But Apple’s stock price may already reflect all this optimism. Even though Apple warned about slowing demand in China in January, shares are still up more than 25% this year and the company is worth nearly $925 billion.

That’s one of the reasons why Jun Zhang, an analyst at Rosenblatt Securities, downgraded Apple shares to a “sell” on Monday. Zhang will also be talking to Quest on “Markets Now” about his thoughts on Apple and other tech stocks.

Zhang and Patricof may also discuss the state of the IPO market. Patricof has expressed concerns about Lyft and Uber, citing what he says are legitimate worries including increased competition in the ridesharing market, backlash against surge pricing and customer complaints.

“It’s a confusing time,” Patricof said in an appearance on Markets Now in March — just before Lyft and Uber went public. He added that investors need to be skeptical of companies that aren’t yet profitable. “We’ve got to see those figures turn around at some point.”

But Patricof may have one other recent IPO to gloat about with Quest: luxury consignment retailer The RealReal. Greycroft owns a stake in the company, which has surged more than 25% since it started trading late last month.

Patricof told Yahoo Finance in March that The RealReal “is hot as can be” and is one of several online consumer companies that Greycroft is investing in right now.

Greycroft also has stakes in startups including contact lens seller Hubble, beverage company Dirty Lemon and women’s-razor maker Billie.

“Markets Now” streams live from the New York Stock Exchange every Wednesday at 12:45 pm ET. Hosted by CNN Business correspondents, the 15-minute program features incisive commentary from experts.

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