Seeking Alpha
View as an RSS Feed

George Acs  

View George Acs' Comments BY TICKER:
Latest  |  Highest rated
  • Cook Does Icahn's Dirty Work At Apple [View article]
    I refer you to your own comment which is the first to attempt to offer some substance to your opening opinion regrading your assessment of short-sighted commentary.
    The comment that describes the "analytical error" that I was purported to have made as "that Apple has no innovation and is pumping its stock through purely and exclusively through financial engineering."

    Those are fantasies of your imagination and not statements that I had made, noir inferred.
    And, it's still "Dr. Acs."
    Apr 25, 2014. 05:40 PM | Likes Like |Link to Comment
  • Cook Does Icahn's Dirty Work At Apple [View article]
    To be fair, Apple hasn't fared poorly by letting others test the waters.

    What they had shown is that no one is better able to take a product that is somehow missing in its ability to excite consumers and then turning it into something on a totally different level in terms of function, form and ease of use.

    I still have my Archos 15 GB .mp3 player that has pretty horrible from every aspect and though that new technology would go the way of mini-discs and others. But Apple can uniquely see the promise that certain product classes may hold and they can unlock that promise.

    So if they perceive interest in a watch, a TV, some health care related personal device or anything else, you can be certain that few will be able to get it done better than they. But when and what are really nagging questions that are taxing even some of the faithful
    Apr 25, 2014. 03:41 PM | 1 Like Like |Link to Comment
  • Cook Does Icahn's Dirty Work At Apple [View article]
    Ultimately, the telecoms don't care what smart phone device you use, although margins may differ at various time. The are about selling service. If Apple intrudes into that sphere and also offers a phone, you can bet that they will begin an ad campaign like nothing seen before.

    Whatever limited competition exists now within individual stores and kiosks to move various products will disappear. There will be disincentive to push iPhone. While Apple has deeper pockets,they'll be in a competitive quandary in the event of deep discounting at the competition to undermine iPod and Apple telecom sales. The quandary is how to respond. They certainly can't begin cutting prices, so it's back to quantum leap innovation pressure, once again.

    They are far better off keeping on good terms with the behemoth players rather than trying to join them in the service sector. Doing so also carries no value to the Apple brand, which would likely be harmed by being a provider. No one likes their carrier.
    Apr 25, 2014. 02:55 PM | Likes Like |Link to Comment
  • Cook Does Icahn's Dirty Work At Apple [View article]
    And antagonize the other few remaining players in the sector? Those players would sooner offer very, very sweet subsidies for competing smartphones than to carry iPhone, or would work very hard to steer customers toward competing products.
    Apr 25, 2014. 01:59 PM | Likes Like |Link to Comment
  • Cook Does Icahn's Dirty Work At Apple [View article]
    With $150 B in cash and easy access to very cheap money, Apple could have done most any acquisition with ease and still generate plenty of cash flow to keep share holders happy, as they need about $11 B for annual dividend payments.

    Would they do a telecom? I don't think so. Their style has never been to go big in their acquisition targets, but you never know. I would imagine there would be some pushback from the remaining telecoms if Apple were to move in that direction, but they would likely have greater ability to pull that off than Google, which still suffers from corporate attention deficit disorder
    Apr 25, 2014. 12:51 AM | 1 Like Like |Link to Comment
  • Cook Does Icahn's Dirty Work At Apple [View article]
    As mentioned earlier, Apple is competing against itself. The market doesn't care what its product margins are compared to anyone else. They simply will care about quarter to quarter comparisons to their own past performance.
    Apr 24, 2014. 08:35 PM | Likes Like |Link to Comment
  • Cook Does Icahn's Dirty Work At Apple [View article]
    And the iPod was once also pre-eminent, but it needed to be superseded by something else. The iPhone won't maintain supremacy forever, unless Apple moves forward and introduces a convincing new product or can replace its revenue stream with a new product line.

    However, it's really not an issue of Apple versus anyone else. Apple is now competing against its past self and the expectations that it has set for itself.
    Apr 24, 2014. 08:32 PM | Likes Like |Link to Comment
  • Expect The Unexpected [View article]
    In general, I like it when shares start to sell off prior to earnings and then sell the puts.

    The reason I like that is because that often gets the excesses out of the stock and may limit the further downside after earnings are announced. Also, with momentum taking a stock lower the option premiums for the out of the money puts start to get enhanced, so you can often get a better ROI even when risk is reduced, as well.

    Of course if shares move higher after you sold the puts that can be great because sometimes you can pocket a decent return even before the earnings announcement.

    On the other hand if shares are moving higher before earnings and then you sell the puts you end up having to select a higher strike price, likely a lower premium (because sentiment is to the upside) and in the event of an adverse report may lose whatever poorly conceived or speculation pre-earnings advance occurred in addition to further losses.

    The old straddle/straddle on Facebook? Too much fine tuning for my tastes and diminishing ability to pay attention to those kind of details. Good luck.
    Apr 24, 2014. 08:27 PM | Likes Like |Link to Comment
  • Expect The Unexpected [View article]
    It's sometimes easy to make some of those kinds of errors. Sometimes mine are so bad the computer starts coughing before it rejects the order.

    Sounds like you've been busy. The more you do the put sales the more you'll appreciate the beauty of rolling them over, especially if you can do so at an even lower strike level, while still adding premium and enhancing the ROI.

    Now, if I remember the scene from Caddyshack, careful about trading your soul to the devil for that perfect round in the rain.
    Apr 24, 2014. 08:15 PM | Likes Like |Link to Comment
  • Cook Does Icahn's Dirty Work At Apple [View article]
    Here's the flaw:

    Those innovations don't sell the products. They are add-ons for most people who are oblivious to the incredible engineering and ingenuity that goes into even incremental product releases. Not many new or repeat customers are going to stand in line because of a fingerprint reader or its potential to be tied to a payment system in the future.

    What is missing is not the innovation, it's the innovative product.
    Apr 24, 2014. 05:11 PM | Likes Like |Link to Comment
  • Cook Does Icahn's Dirty Work At Apple [View article]
    You're counting on multiple expansion just as people have been doing for years.

    Apple's P/E, which was briefly down to about 9 prior to Icahn's entry, is held down for two reasons. It is valued as a retailer and it sits on cash that accounts for 30% of its market capitalization. That means that only 70% of the value is generating real revenue and it serves to lower the overall P/E.

    People have been using the low P/E, by tech sector standards, for years to justify the belief that shares would head even higher and higher.

    Guess what? That's not likely going to happen unless they do something with the cash and re-establish hard core revenue growth. None of the moves yesterday indicate that Apple is going to be that company anymore. Think Intel, Microsoft and Cisco. Cash coming in like crazy, but not the kind of growth as in the past.
    Apr 24, 2014. 05:08 PM | 1 Like Like |Link to Comment
  • Cook Does Icahn's Dirty Work At Apple [View article]
    On one hand, that is what upsets people so much. The market values Apple as if it was a retailer and not a technology leader. That may explain its low P/E and how that P?E has continually gone down as Apple has expanded its retail presence and piled up cash (which itself accounts for 30% of market cap, yet has a P/E of just 1)

    Most would rather not think of Apple as a retailer and they hold onto dreams of it being valued as a tech company, as if the market was completely unaware and would suddenly wake up.
    Apr 24, 2014. 05:01 PM | Likes Like |Link to Comment
  • Cook Does Icahn's Dirty Work At Apple [View article]
    It's Dr. Acs
    The past is the past. You can respect the past yet still question the path for the future. Apple had long received a free pass on many issues and is now increasingly under scrutiny over many issues.

    The error you make appears to be in reading comprehension. What you specifically refer to as "short-sighted" are of your own projections and distorted interpretations. There is a difference between innovation and an innovative product. Further, the claim was not that Apple has "no innovation" as you have interpreted, but rather that its innovation is being called into question.

    Neither was there a comment that the stock was being pumped "purely and exclusively" through financial engineering. Those are entirely of your own making.

    You appear to be an apologist for the Board, suggesting that they somehow came to a realization that cash was piling up well beyond the needs of the company. The amount of cash in Apple's coffers has long been well in excess of what was necessary for R&D and for acquisitions. The Board has acted not out of their fiduciary responsibility, for they would have done that long, long ago. Rather, they acted from activist pressure. The time frames of their insertion into the equation by Einhorn and Icahn are far too congruous to be coincidental.

    Having seen comments over the years, particularly with Apple, it is usually clear that the degree to which someone puts their "money where their mouth is" often precludes them from an objective and critical look at events surrounding them. That is certainly understandable, although not necessarily excusable.
    What is not understandable is how you failed to comprehend or understand that I view Apple as a better trading stock today, than it was yesterday, specifically due to Cook's actions. You have been around long enough to know that what he has done is taken a lesson from the annals of history of those companies that are getting ready to settle into middle age, not senescence and not irrelevance.
    Apr 24, 2014. 04:49 PM | Likes Like |Link to Comment
  • Cook Does Icahn's Dirty Work At Apple [View article]
    Apple has spent a decade hitting home runs. It was the home run and then another and another that rescued a moribund company, that was on life support.

    Doing fine and selling product to a slowly growing consumer base is not what supports share price at the levels that investors have become accustomed.

    What you are saying is precisely what I have said, but you did so in terms of the consumer market and I said so in terms of stock price.

    We both agree that the momentum days are going to be, or are already a thing of the past.

    If your focus is not on share price, but rather on the evolution of consumer products, then that evolution can be gradual and needed by in quantum form, but for the stock? If you take away the quantum release and explosive revenue growth from those releases, then you just have to do what Tim Cook has just done.
    Apr 24, 2014. 03:57 PM | Likes Like |Link to Comment
  • Cook Does Icahn's Dirty Work At Apple [View article]
    I have no doubt that Apple is busily at work nearly every second of the day somewhere in the world seeking to innovate.
    It's not that they will stop innovating. It's a question of bringing an innovative product to the market. Then further, that innovative product has to be broadly accepted by consumers.

    Under the radar innovations bring few customers at the margins. There needs to be a quantum leap, especially from a company that had its glory days by doing quantum leaps so well and then convincing consumers to purchase intermediate versions of products with fantastic profit margins.
    Commoditization, competition and brain drain are all conspiring against any single company from monopolizing the market place for all eternity.
    Yet, still, that is not at issue in this article. It is simply one that suggests that its upward only growth days are behind it. The moves Cook has just taken are those pulled from the text book of thriving, once go-go companies that are settling into a different phase of their corporate lives.
    As it does, the strategies for creating profits from Apple shares may change from buy and hold ( and hopefully selling to capture profits) to more opportunistic techniques, such as covered options.
    Apr 24, 2014. 03:51 PM | 1 Like Like |Link to Comment
COMMENTS STATS
5,575 Comments
3,598 Likes