David Anber

David Anber
Contributor since: 2012
Company: David Anber's Law Office
at LL or in this article?
LowRisk - Apple is very oversold. Fundamentals would have seen it get reduced on earnings and sales from where it was last fall, but realistically it should be bouncing around from $560 to $660 (instead of $380 to $450.
Apple is not going to gain back some of this oversold territory - at least in the next year or so - without some reason. A real new product, or a deal with CM would be such a reason.
I'm certainly no expert, but what I see is the following (on an announcement):
- Initial spike from $410 to $470
- Bleeding back to $440 over the next couple weeks
- Bouncing around from $435 to $480 for a month or two
- Steady climb over 10-12 months to $800
Keep in mind that my theory is based on all other things being equal. Apple is more or less in the range of analyst expectations, not wowing but not missing by all that much. If this were to change that could affect the theory; as could a new product, or a disappointing product.
I think the "small spike" point of view is the most fanciful one of all.
It doesn't matter how negative sentiment is; a China Mobile deal is not priced in at all. I'm not necessarily a believer that a deal is going to come together in the medium term, let alone imminent as this article suggests, however if it does, Apple's price will double within 12 months -- at least. In fact the negative sentiment only makes this more of a reality.
I don't deny that there is a reasonable debate to be had as to how likely a CM deal is, however there can be no debate on the issue of *if* a CM deal is reached, that anything other than a significant appreciation in Apple's price will happen.
when do the buybacks finish
Bret - Just curious as to what your thoughts are on TST now about a year later. Since your article, the dividend went bye-bye. The stock seems to have found a bottom in August/12 which is when I bought in. Since then it has had a nice run and I wanted to know how you feel about your thesis for the next 12-24 months.
Not at all - he had a hypothesis and he confirmed it. People often have hunches or ideas which after running a rigourous analysis don't stand up. The fact that he tested his hypothesis and confirmed it isn't confirmation bias.
Don't get me wrong, I am not a hater. But the market is filled with securities which trade at a discount to tangible metrics. Look at the fund SVVC. I, like many other people regrettably bought into it because it owned shares of facebook in advance of the facebook IPO. Thankfully I bought in at 17 and sold it off at a profit, but look to the message boards of how many people are complaining how SVVC's cash holdings alone should have the stock trade in the low 20's. By your logic, (and many of them) it makes no sense for something to trade below cash value -- which, in a purely abstract sense is true. But when something trades at a serious discount it's usually because there's a good reason. Sony has not had a very easy transition from analog to digital. I still see value in this stock, particularly as "smart TVs" start to find themselves in everybody's household over the next 5-10 years but, in light of the other challenges, I wouldn't buy in until - A - the stock trades significantly lower and - B - the fundamentals seem to support my smart tv hypothesis; until those two things happen, this is a classic value trap.
...which should be the price in about 10 hours or so :-)
But that's the risk any time you have enough conviction to buy a stock. I am just saying that I can still buy it at 90, or in the alternative I can make $0 to $1500 per contract without putting out a premium.