Investors Anxiously Await This Momentous Decision
With Apple’s lawsuit concluding in the near future, all eyes will be on the verdict.
The arguments from both sides of the lawsuit between Apple Inc. (AAPL) and Epic Games have been made. On Monday, closing arguments were heard in the massive antitrust trial.
I you haven’t been following along, Epic Games filed suit after its uber-popular Fortnite game was banned from Apple and Google’s app stores in August. The ban was a result of Epic Games circumventing the app stores and offering direct in-game purchases at a discount.
Epic is arguing that Apple’s requirement that developers distribute their programs exclusively through the App Store and exclusively us Apple’s payment processing services – which includes a 30% commission for Apple – violates antitrust laws.
The outcome is now in the hands of California federal judge Yvonne Gonzalez Rogers, who is expected to deliver a ruling in the coming weeks.
And the results could have huge implications for one of the world’s biggest tech stocks.
Where’s the money?
It’s an understatement to say that Apple has a lot riding on the outcome of this case.
If forced to alter its terms of service and allow developers the ability to get their apps onto iPhones using third party app stores, Apple would potentially lose a huge source of revenue.
While Apple doesn’t provide figures for just App Store revenue, it is part of more than $53 billion in annual revenue that is comprised of the App Store, Apple TV, iCloud, and Apple Music.
Apple has argued that creating secondary app stores would be bad for both Apple and the developer, as well as create additional security risks.
The decision now falls to judge Gonzalez Rogers to decide if Apple’s practice violates antitrust laws.
Either way the decision goes, it will have major implications on Wall Street. Here’s what I see happening…
How do I get some?
The court case between Epic and Apple is getting a lot of headlines right now, but in the long run I do not think it will matter much.
Apple has a platform, if you want to sell on it, you have to pay.
I’m not about to predict how the judge will rule, but I have a hunch that Apple will come out on top.
But even if Apple loses, it may not mean a huge loss of revenue. With more and more attention being put on cybersecurity, consumers may continue to frequent the App store for the additional level of security it provides.
I like Apple in the long term, but I actually like Apple Glass maker Vuzix Corporation (VUZI) here the best.
VUZI has had a pullback over the last month from $33 to $17. I think this is a great discounted buying position for a name that continually shows up on my scanners.
Why You Shouldn’t Be Focused on AT&T’s Dividend Cut
For years, AT&T Inc. (T) has been a favorite among investors for its strong dividend payments and price appreciation.
But with the recent news that AT&T is selling its media arm to focus on its core wireless business, it has also been announced that the dividend will be cut from $15 billion down to as little as $8 billion.
That’s left many investors searching for a new place to put their long-term investment capital. And one of the best answers to that question is in a space you might not expect.
This company currently pays out a dividend yield of 6.7%, and it’s a part of an industry that’s expected to climb from $20 billion in sales in 2020 to $45 billion by 2025.
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In the Spotlight: Ford Electric Vehicles in the Limelight
Ford Motor Co. (F), one of the biggest names in the automotive industry, is entering the EV fray with its F-150 Lightning truck.
And the early reviews have been positive.
The new all-electric F-150 has been incredibly well received for its impressive performance – specifically in acceleration and towing capacity.
The successful launch has caused several analysts to upgrade their price targets on Ford as it moves to join a heated competition in the surging EV space.
Ford shares are already up 6.5% since the F-150 Lightning unveiling last week, so we’ll have to keep a lookout for a dip that will offer a good buying opportunity. But with increasing sentiment for electric vehicles, I’m all-in on the EV industry.