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3 Reasons Apple Is a Great Buy, Even If a Recession Hits

DATE POSTED:October 12, 2019

Stock investors worried about a possible recession but still interested in staying in the market don't necessarily have to load up on utility stocks or other traditional defensive alternatives that hold up well in tough economic times. They could consider buying shares of Apple (NASDAQ: AAPL).

While a tech stock may not be your typical choice as a "safe" investment to ride out a recession, Apple is an exception and a better buy than many of its growth stock peers. Here are a few reasons why.

One of the reasons Apple isn't as big of a risk as its peers in a downturn is that it isn't overpriced. While the stock may drop during a recessionary downturn like any other stock susceptible to macroeconomics, it's not likely to suffer significant long-term losses because it's currently a good value buy. Its valuation suggests it is fairly priced and will more likely recover sooner once economic conditions improve. Even at the $1 trillion valuation it currently hovers around, Apple is still only valued at a price-to-earnings (P/E) ratio of 19. That's nowhere near the 70-plus P/E ratio that Amazon trades at or the multiple of 30 that Facebook is currently trading around.

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