Seeking Alpha

Chad Brand

 
View Chad Brand's Comments BY TICKER:
  • Now That Apple Has Bottomed, What Is It Worth? [View article]
    I'd be surprised if it drops below $385. The Street already knows the next two quarters are going to be bad, which will make 4 straight quarters of negative earnings growth year-over-year, so 2013 should be a trough year for earnings. If you don't see impressive new product categories by 1H 2014 then you could see another sell-off, but I think the buyback will put a floor on the stock for a while. They are going to buy $60 billion of shares over the next 2.5 years. That's a lot... half a billion dollars' worth every week from now on...
    May 9, 2013. 06:51 PM | Likes Like |Link to Comment
  • Now That Apple Has Bottomed, What Is It Worth? [View article]
    CapEx was actually $2.0B in Q1 2013!
    May 8, 2013. 02:17 PM | Likes Like |Link to Comment
  • Now That Apple Has Bottomed, What Is It Worth? [View article]
    That is how I am viewing it as well. No guarantee it will work out, but it's a bet that I am more than willing to make.
    May 8, 2013. 11:26 AM | 2 Likes Like |Link to Comment
  • Now That Apple Has Bottomed, What Is It Worth? [View article]
    If you wait until they introduce new products, you will miss a large move and be forced to pay more for the stock. I do believe they will have new products which will contribute to a more normalized peer group valuation, but I want to own the stock before that happens..
    May 8, 2013. 11:23 AM | 11 Likes Like |Link to Comment
  • Now That Apple Has Bottomed, What Is It Worth? [View article]
    Have been a long term holder and bought more recently in the low 400's. Have enough right now.
    May 8, 2013. 11:21 AM | 4 Likes Like |Link to Comment
  • How To Value Apple Stock As It Sets Market Value Record [View article]
    Absolutely. Today's stock prices reflect today's consensus expectation for the future. If the company outperforms those expectations, the stock price rises, and vice versa. It's a pretty simple concept of the stock market.
    Aug 23, 2012. 11:43 AM | Likes Like |Link to Comment
  • How To Value Apple Stock As It Sets Market Value Record [View article]
    The current price is the consensus expectation for PV of future CF. Of course this is not always accurate in hindsight. In fact, in a majority of cases it won't be, simply because the future is hard to predict. But that doesn't mean that stock prices don't reflect current expectations at any given time. Investors need to decide if those expectations are overly bullish or bearish, and then act on that conclusion. Being right is how one makes money in the market long term.
    Aug 23, 2012. 08:21 AM | Likes Like |Link to Comment
  • How To Value Apple Stock As It Sets Market Value Record [View article]
    You laid out the case for why it might actually makes sense for AAPL to trade at a 10-25% discount to those other non-tech blue chips right now.
    Aug 22, 2012. 07:07 PM | 2 Likes Like |Link to Comment
  • How To Value Apple Stock As It Sets Market Value Record [View article]
    Not sure where you got 12x from... perhaps you did not account for their massive cash position in your calculation. Cash flow is EV/EBITDA to account for cash and/or debt on the books.
    Aug 22, 2012. 07:05 PM | 1 Like Like |Link to Comment
  • How To Value Apple Stock As It Sets Market Value Record [View article]
    Believe me, valuing stocks based on cash flows is not new. In fact, it's what every finance textbook teaches you. The idea is the same as using P/E ratios, except it is more accurate because reported earnings have a lot of non-cash accounting charges that can mislead investors (in either direction) about the underlying cash profits a company generates.

    In Apple's case, the trailing P/E is 15x but that ignores the cash they have. If you use EV/EBITDA (aka enterprise value / cash flow) you get a 9x cash flow multiple. So with Apple, the "E" in their P/E is actually understating their true cash earnings. Remember, a stock's price always represents the present value of all future cash flows the company is expected to generate into perpetuity.
    Aug 22, 2012. 06:21 PM | 1 Like Like |Link to Comment
  • How To Value Apple Stock As It Sets Market Value Record [View article]
    From Investopedia.com:

    Definition of 'Law Of Large Numbers'

    In statistical terms, a rule that assumes that as the number of samples increases, the average of these samples is likely to reach the mean of the whole population. When relating this concept to finance, it suggests that as a company grows, its chances of sustaining a large percentage in growth diminish. This is because as a company continues to expand, it must grow more and more just to maintain a constant percentage of growth.
    Aug 22, 2012. 06:16 PM | 2 Likes Like |Link to Comment
  • Why Tim Cook Should Announce A Massive AAPL Share Buyback Immediately [View article]
    @kmanm:
    Buybacks reduce the number of total shares, which has the direct impact of increasing each shareholder's percentage ownership of the company. Cutting the same pie into fewer slices makes each slice larger, as the analogy goes. While it is true that many large tech companies like INTC, CSCO, and MSFT have done buybacks which were then followed by share prices declines, those are completely independent of each other. The stock drops were not because of the buyback, but instead due to poor business fundamentals (which more than offset the accretion from the buyback). Buybacks immediately increase the value of your shares, assuming all else equal. Dividends do pay out money directly to shareholders, but the company's value decline by the same amount, so after taxes the investor is actually less well off (or in the exact same position in terms of value if held in an IRA).
    Oct 11, 2011. 10:40 AM | 1 Like Like |Link to Comment
  • Apple's Good News Already Priced In [View article]
    Nobody is refuting the fundamental story at Apple. I have been writing about it myself. The angle this time is about the stock price and what is priced in already, not the company growth outlook. Everybody already knows about the market share gains AAPL will achieve in the PC market, so the question to ask is, "what has the market already factored into the stock price?" and "how much should you be willing to pay for the stock?" At a forward PE of 25-30, a lot is being factored in already.
    Sep 8, 2006. 10:40 AM | Likes Like |Link to Comment
More on AAPL by Chad Brand
COMMENTS STATS
151 Comments
70 Likes