Apple Inc.’s (AAPL) Best Growth Opportunity

investMichael Robinson: You may remember the famous “1984″ commercial introducing Macintosh personal computers. In the ad, “Apple” is an iconoclastic young heroine who hurls a hammer at a giant screen broadcasting “Big Brother” (IBM) lecturing to a legion of followers.

Indeed, Apple Inc. (NASDAQ:AAPL) vs. International Business Machines Corp. (NYSE: IBM) was one of the bitterest tech rivalries of the past 30 years.

But instead of David battling Goliath to the death, the two are now joining forces in a bold new pact.

It’s a good deal for both companies… And today I’ll reveal which stock will end up as the better buy – and make it a great deal for you…

Why IBM Is “Back”

At the time of “1984″ – and of the 1981 newspaper ad in which Apple “welcomed” IBM to the PC marketplace – Big Blue was the “Goliath” of the computer industry, a global giant that had already been around for decades. It catered to Fortune 500 companies and government agencies that needed industrial-strength computing.

“David” was a brash Silicon Valley startup whose PC breakthroughs appealed to individuals and small companies. It was the go-to company for creative types like graphic designers and photographers.

The tech world has changed in innumerable ways since the 1980s – we no longer talk about IBM “clones” anymore, for one thing – and both of these companies are now true corporate titans.

In fact, by market value, Apple is the largest company in the world.

And while IBM has since sold off its PC business to Lenovo Group Ltd. (OTCMKTS ADR: LNVGY), it remains a major force, especially in the so-called “enterprise” market. Its huge corporate and government clients – including 80% of the Fortune 500 – pay dearly for IBM’s high-performance computing services.

IBM counts some 1,000 universities and 2,215 companies as business partners. Its list of global customers runs dozens of pages and includes some of the world’s largest organizations.

In recent years, IBM has invested more than $24 billion to bolster its offerings of Big Data analytics; you likely know about its marquee Big Data computer, the “Jeopardy!”-winning Watson. It’s also spent roughly $7 billion on cloud-computing initiatives.

And it boasts what may be the world’s largest suite of software and services operations. Just in this year’s first quarter, IBM’s sales of software and services totaled some $15 billion.

Add it all up and you have a sprawling worldwide company that is involved in virtually every aspect of corporate computing.

But one area in which it has a glaring weakness is the fast-moving mobile world. IBM is a virtual no-show in smartphones and tablets.

And that’s where this historic agreement comes in. Instead of launching its own mobile division, IBM has found a new best friend in the mobile world’s clear technology leader.


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