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Eric Rolfe  

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  • Apple's Growing Channels [View article]
    Unfortunately there is no data on what proportion of channel inventory is which phone. I think someone could probably come up with some fairly good educated guesses. I think most of it will be the iPhone 5 since the iPhone 4s and 4 are only available in one memory size each, the iPhone 5 is available in 3. If they were all stocked equally (doubtful since the 64gb iPhone 5 certainly sells less than the 16 and 32) 3/5 of the channel would be iPhone 5.
    Nov 27, 2012. 09:21 AM | Likes Like |Link to Comment
  • Apple's Growing Channels [View article]
    As far as going down a lot it is just relative -3% is pretty minuscule compared to the 30% growth the previous quarter. Honestly the iPad mini could completely destroy iPad models people are currently using. It real could be something like a 50% increase in channel inventory once they get to the point when they are filling channel inventory.
    Nov 26, 2012. 10:10 PM | Likes Like |Link to Comment
  • Apple's Growing Channels [View article]
    The straight line on the graph is the trend line. The green line is the channel inventories. Apple internal inventories have nothing to do with the analysis those are just held as liabilities on the balance sheet. You can see where the green line goes up sharply at Q2 and then goes down a small amount at 2012 Q3. Does that make sense?
    Nov 26, 2012. 09:49 PM | 1 Like Like |Link to Comment
  • Apple's Growing Channels [View article]
    Apple counts sales to channels as sales, as do most companies. Apple does try and track sell-through vs sell-in at their partners, but I think this is so they can try and manage channel inventory better. Sales through Apple stores and the website only count once the customer has the product in hand. Most device companies don't have the situation where direct sales are a significant portion of revenue, so when a company in general says sales they are talking about mostly channel sales.
    Nov 26, 2012. 08:58 PM | 1 Like Like |Link to Comment
  • Apple's Growing Channels [View article]
    No, in most of the calls the approximate channel inventory is either stated or the change in channel inventory from the previous quarter is stated.
    Nov 26, 2012. 07:26 PM | Likes Like |Link to Comment
  • Apple Is Sandbagging More Than You Think [View article]
    I agree with this as related to warranty amortization. On foreign earnings I think Apple is not obligated under GAAP to set aside this repatriation money. If I am wrong on this I'd like to know, post a link if you have one.
    Oct 29, 2012. 12:58 PM | Likes Like |Link to Comment
  • Apple Is Sandbagging More Than You Think [View article]
    I agree with this being a common practice which is why I don't go through a new calculation of PE with it included. I think some people are not aware of the practice in general and just wanted to cover it since I was already going over liability related stuff on the balance sheet.
    Oct 29, 2012. 12:31 PM | 2 Likes Like |Link to Comment
  • Apple Is Sandbagging More Than You Think [View article]
    Ed, I'm not the first person to see this trick. I think most of the analysts on Wallstreet know about this. They seem to be perpetually driven by trying to guess the earning number for the next quarter more than actual financial analysis of the reported earnings. They are only interested if Apple changes accounting methodology which is highly unlikely.
    Oct 29, 2012. 12:03 PM | Likes Like |Link to Comment
  • Apple Is Sandbagging More Than You Think [View article]
    That is for non-current liabilities only. I did this because including deferred I think is a little misleading, they can be used in the forward PE.
    Oct 29, 2012. 11:08 AM | Likes Like |Link to Comment
  • View Apple By Seasons, Not By Quarters [View article]
    I agree with almost everything you said here. I'm curious what effect you think Apple shorting their release cycle from 12 months down to 8 or 9 would have on this(What if the shortened refresh on iPad Retina was not an abnormally).
    Oct 28, 2012. 10:12 PM | 1 Like Like |Link to Comment
  • Customer Service Awards Aren't Leading To iPhone Sales At Sprint [View article]
    I have to agree with Ted on this. We won't know until next year but I'd be willing to bet you see something in the 2.2 - 2.7 million units next year for the same quarter since 1.5 million iPhone owners will be coming off contract.

    I also think the ubiquity of the iPhone tends to make people less likely to switch carriers. It is very profitable to get dumb/feature phone users into more expensive data contracts but as far as increasing subscribers the effect is just not that big. It is to the point now that a company need's to have the iPhone just so people don't leave for another carrier.
    Oct 28, 2012. 10:11 PM | Likes Like |Link to Comment
  • Apple Has Peaked: The Warning Signs Are Multiplying [View article]
    Whenever someone has a section called "Irrelevance of Traditional Valuation Techniques" it doesn't bode well for the reasoning and facts that are used in the piece.

    If you assumed Apple hardly grew at all , the current valuation would be fair if not cheap. no growth would basically assume Apple would get $40 billion in cash each year.

    All they would have to do is increase the dividend to pay out all the increased cash they get. Which would be about $40 billion at 0% growth.

    That ends up being $42 Dollars a share. Which at the current stock price would be a 7%+ yield. The yields on big stable companies rarely reach 5%. To get to the 5% yield you would end up with a share price of about $840.

    I don't know what Apple is going to do this quarter or next but eventually the fundamentals are the only thing that matters. Not analyst, pundits or bloggers.
    Oct 28, 2012. 10:09 PM | 5 Likes Like |Link to Comment
  • Apple And The Overseas Tax Showdown [View article]
    Just trolling through some old articles looking for some AAPL number related to cash. I came across this and thought I would make a correction/observation. Apple actually already sets aside money to pay the US income tax. It just puts it down on it's balance sheet as a liability. So what would happen if the us declared some sort of tax holiday is that apple would have an instantaneous extra $16billion dollars in profit as of Sept 12 Quarter.

    You can find the account on the balance sheet under
    Other non-current liabilities

    As an interesting side note if they just restated the earnings for the last year with that counted as profit it would actually lower their P/E by about 90% which as of this comment is around 13.6 so that should actually be about 12.25
    Oct 27, 2012. 11:53 PM | Likes Like |Link to Comment