Fort Myers Florida Weekly

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Expectations Matter

QApple posted record sales of devices in its last quarter, yet its stock fell. Why?

— S. S., Longmont, Colo.

AIt all comes down to expectations. Apple reported record sales of $57.6 billion in its first quarter of 2014, and a record number of iPhones and iPads — 51 million and 26 million, respectively. That’s terrific, but while earnings were a bit above analyst expectations, revenue was below. And investors had been expecting to see several million more iPhones sold, too. Falling short of expectations can send a stock tumbling, at least in the short run.

Future expectations matter, too. Apple’s pro it margins have been shrinking in recent years, causing some to worry. Still, there’s a lot to like about the company, such as its huge pile of cash and equivalents of more than $150 billion, its dividend of 2.3 percent, its strong market share in mobile devices and its ability to innovate and create new product categories.

The stock seems cheap these days, but opinions are divided on its future, even at Fool HQ. (The Motley Fool owns shares of Apple and its newsletters have recommended it.)



I have to pay taxes on dividends received in my Roth IRA?

— E. M., Phoenix


Whatever you invest in a Roth IRA grows free of taxes on capital gains and dividends. Your ultimate withdrawals will not be taxed, either — if you follow the rules.

Traditional IRAs offer different benefits. The qualified contributions you make to them reduce your taxable income, thereby giving you a tax break up front. But upon withdrawal, gains and dividends are taxed at your ordinary income tax rate. Learn more at

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