Net Net: Promoting innovation and managing change
Net Net: Promoting innovation and managing change

Is the Market Ready to Take a Bite Out of the Apple?

My friend Matt Gohd at Revere Securities thinks that Apple shares might be headed for a rough patch.

Gohd is a contrarian who has made more good calls than I can count.

Sometimes I don't even have the chance to report them. A week ago Gohd wrote to me about Caterpillar, which was then trading at $87 a share.

He thought that weakness in Chinese cement stocks forewarned of a fall in Caterpillar shares . Four days later the stock was a $73.

Now Gohd thinks Apple is over-owned and over-hyped. Google's Android system can give Apple a run for the money in tablets, and the Amazon Touch is a real threat, according to Gohd.

"Also at the Facebook developers conference, Spotify was warmly embraced—which may create problems for iTunes as as well as cloud based solutions," Gohd tells me.

Gohd also believes Pandora's days may be numbered as well.

Lastly, the very popularity of Apple with "smart money" investors could be its undoing.

"The fact that every major fund has big positions in Apple will create a real bottleneck to get out with no real shorts to cover to create a bid," Gohd says.

Gohd says he has developed an asymmetrical options strategy to create a big return if Apple hits his $340 target price. It's currently trading around $400 a share.

Gohd isn't all bad news. He mentions that he likes Cincinnati Bell .

That's the telecom company that is just one of the nine stocks owned by Charlottesville, Va.-based Peninsula Capital Advisors. It's a big play for Peninsula, which has committed more than 3 percent of its assets under management to buy about 10 percent of the stock.

And why should you care about Peninsula? Well, its founder, Ted Weschler, was just tapped by Warren Buffett to manage the $52 billion in equities held by Berkshire Hathaway.

Keep in mind that Gohd is a trader and may or may not hold positions in all of the investments he mentions.

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