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  • FY2015: Apple's Big Adventure [View article]

    Due to the ongoing share repurchase program Apple’s market cap is rising at a slower rate than the rate of share price appreciation.

    The Macintosh line is gaining market share. Apple is among the top 5 global PC makers for the first time in decades and recently reclaimed the number three spot among domestic PC makers. The iPhone is gaining revenue share, market share and overall industry profit share in the high-end segment of the smartphone market.

    Institutions remain underweighted in Apple and the company is at the beginning of its biggest year in history for revenue, net income and earnings per share.
    Nov 30, 2014. 12:35 PM | 18 Likes Like |Link to Comment
  • Apple: It's A Matter Of What, Where And Why [View article]
    Dan Manners:

    Thank you for your comment. As a matter of practice, I don’t include unannounced new products in forecasts or forward-looking estimates. Based on Apple’s current slate of products and services I do see improved margin over FY2013 and a stabilization of ASPs.

    While there is a possibility of at least one new product line in FY2014 and a possibility of some expansion of the iPhone and iPad product lines, I will address the impact of those occurrences following an announcement by Apple.

    In all, I view Apple as a customer relationship continuum and the company’s continuing build out of content delivery infrastructure suggests an expansion of products and services in the coming months and years.
    Dec 29, 2013. 10:42 AM | 17 Likes Like |Link to Comment
  • Apple Looks East, Looks West For Growth [View article]

    I consider Apple a much more attractive long-term investment than a short-term play. I believe the days of the "slingshot" moves higher are over.

    Record revenue, record net income, the ongoing $90 billion share repurchase program and expected dividend increases make for a solid long-term investment.
    Sep 28, 2014. 02:39 PM | 12 Likes Like |Link to Comment
  • Apple's Game Of Inches [View article]
    Harm Elderman:

    The term “game of inches” has been commonly applied to sports including horseshoes, baseball and football. It’s a reference to precision in execution and the importance of consistently grinding out even small plays successfully.

    As sports fans we like the long ball, the long pass and the big plays. As Apple shareholders we like the company’s big disruptive steps. But for long-term shareholders, there’s much to be gained from comparatively slower rates of revenue growth and consistently driving net income growth. This isn’t to say Apple isn’t going to take big disruptive steps in the future. But even now the company’s results are impressive and will lead to share price appreciation.
    Jul 27, 2014. 01:17 PM | 12 Likes Like |Link to Comment
  • Apple: Where From Here? [View article]

    I consider current marketshare analysis of the smartphone market almost meaningless. I can purchase an Android 2.3 handset at my local supermarket for $59 without a contract commitment. Yet this inexpensive, low-margin handset for statistical purposes carries the same weight in unit sales and marketshare analysis as an iPhone or high-end handset from Samsung HTC or Sony.

    As feature phones disappear from the market and are replaced by cheap "smartphone" handsets, marketshare numbers will be skewed. Currently the white-box manufacturers selling inexpensive handsets are collectively gaining marketshare.

    Apple's focus on yield per customer and long-term customer acquisition must be viewed using a different series of metrics. Among the company's challenges that's revealed in the June quarter numbers is sustaining strong Apple Retail traffic in the six months prior to the expected fall product line refreshes.

    Apple customers tend to begin sitting on their hands in the spring in anticipation of the next product refresh cycle.
    Jul 28, 2013. 02:13 PM | 12 Likes Like |Link to Comment
  • Apple's Magical Mystery Year [View article]

    Braeburn is a hybrid Apple variety. It has a complex flavor and can be challenging to cultivate. This is not unlike the work needed to organize a global network of Apple independent analysts.

    As an aside, Braeburn Capital is the name of Apple's asset management company. I'm sure the folks at Apple's asset management subsidiary know something about technology. Even more they know something about managing hundreds of billions of dollars in cash and equivalents.

    I don't know if any of the staff members at Braeburn Capital play shuffleboard, but the subsidiary is based in Reno, Nevada. If shuffleboard is your sport and you are looking for partners, you can always call and ask.

    Braeburn and shuffleboard in my view are strange word associations to ask about, but each to his or her own view on life. For the record, I haven't played shuffleboard in many years so you will have to look elsewhere for a partner.
    Good luck with your pastime of choice. I didn't know that many people were interested in shuffleboard anymore.
    Now back to Apple. 
    Oct 27, 2014. 12:22 AM | 10 Likes Like |Link to Comment
  • Apple's Magical Mystery Year [View article]

    Of course I did expect some Beatles-related comments.

    I consider the current price a bargain for long-term shareholders. The $90 billion in share repurchases have yet to be exhausted and there are several catalysts yet to fully unfold this fiscal year.
    Oct 26, 2014. 01:11 PM | 10 Likes Like |Link to Comment
  • Apple Looks East, Looks West For Growth [View article]

    Apple has the advantage of creating its own operating system and provides its own eco-system for customers. Commoditization is a factor for device makers that can not distinguish their products in the marketplace.

    Apple's most enduring product line, the Macintosh line, continues to gain market share and unit sales as the global PC market continues in a cycle of global economic decline.

    Offering consumers something other than the norm is Apple's approach to success.
    Sep 28, 2014. 05:43 PM | 10 Likes Like |Link to Comment
  • Apple Looks East, Looks West For Growth [View article]

    In my view the opposite is occurring. Samsung is in a cycle of profit declines and the share price recently fell to a multi-year low. The falloff is due in part to increasing competition from Xiaomi and Huawei. Don't forget Samsung's archival LG also makes smartphones.

    China Mobile was added by Apple as an iPhone carrier only within the past year. Apple will have a strong model year in China as China Mobile continues its 4G/LTE rollout.
    Sep 28, 2014. 05:39 PM | 10 Likes Like |Link to Comment
  • Where In The World Is Apple's Growth? [View article]

    One of my often mentioned axioms about Apple is:

    Apple doesn’t sell products. Apple creates customer relationships and these customer relationships sell Apple products.

    If one views Apple primarily as a purveyor of separate and independent digital device lines, any effort to boost unit sales would be the expectation.

    If one views Apple as an eco-system, expectations move beyond how many iPhones, iPads or Macs Apple might sell in any particular quarter.

    Apple has more than one-half billion iTunes customers with accounts backed by credit cards and the rate of revenue flow to developers is quickening by the month and is rising at a consistent rate.

    Yield per customer and expanding the addressable market for developers is as important as increasing the number of units sold of any one particular product in any particular period.

    Releasing a lower-cost iPhone for emerging markets or the global market as the smartphone market rapidly matures and releasing new products for the high concentration of Apple customers in the US and Europe are not mutually exclusive outcomes. But releasing a lower-cost iPhone will not deliver net income growth commensurate with the rise in unit sales.

    At this time, the US and Europe remain Apple’s best markets for increasing revenue yield per customer and expanding the addressable market for developers through the release of new products.

    At my website I publish a variety of charts and data tables chronicling Apple product unit sales and Apple’s financial results with associated performance metrics. This article provides a current overview of my continuing work tracking Apple’s revenue and operating income performance by region.
    May 27, 2013. 11:22 AM | 10 Likes Like |Link to Comment
  • Why Apple Will Beat The Street [View article]

    The so-called "Law of Large Numbers" does not apply. In the current fiscal year, 80% of Apple's revenue will be derived from products that did not exist in the market as recently as six years ago. Chances are six years from today more than 50% of Apple's revenue will be derived from products that are only now in early stages of development.

    There are large and essentially untapped regional markets for Apple's products and the company is the only maker of iOS-based devices. Apple will maintain high margin and the leadership in digital device revenue share even as more competitors enter the digital device markets.

    Android is an amalgamation of device makers competing more with one another than any one Android device maker successfully compete with Apple. Apple's gross margin is pressured in the current quarter due to manufacturing changeovers that do not impact the marginal cost of each additional unit sold. Carriers are willing to pay over $400 in subsidies to provide the iPhone 4 at $0 to customers in the States and the iPhone 5 continues to deliver high average selling prices for Apple.

    Competition among Android handset makers will continue to increase. But that doesn't necessarily mean more competition for Apple. Revenue share is more important to Apple than nominal market share numbers and management has stated the company will manage its operations for margin, not market share.
    Dec 2, 2012. 02:59 PM | 10 Likes Like |Link to Comment
  • Apple's Magical Mystery Year [View article]

    Samsung's shares set new multi-year lows last week and are now trading at early 2012 price levels.

    There's intense competition for Samsung on China's mainland from Android-based handset makers and even Google's new handsets will take share in the high-end market from Samsung.

    This will be the biggest iPhone upgrade cycle in the history of the product line with strong unit sales growth in all five of Apple's geographic revenue regions.

    Please remember there's a robust market for pre-owned iPhone handsets. Although those handsets when resold won't be a factor in reported new handset sales, the resold handsets will increase the number of consumers engaged in Apple's global eco-system.
    Oct 26, 2014. 01:25 PM | 9 Likes Like |Link to Comment
  • Apple Looks East, Looks West For Growth [View article]

    I view Apple as a solid long-term investment. On a percentage basis, the shares are currently under owned by institutions. In my view, that's a subtle bullish indicator. An announcement on the release date of the Apple Watch line may benefit the share price in the short-term.
    Sep 28, 2014. 03:33 PM | 9 Likes Like |Link to Comment
  • Apple's Game Of Inches [View article]

    Isn't it time for you to starting writing articles in addition to your thoughtful comments on the work of other writers?
    Jul 27, 2014. 08:24 PM | 9 Likes Like |Link to Comment
  • Apple's Game Of Inches [View article]

    Thank you for your comment. I’m not discounting the possibility or even probability of new products and services nor the impact of the company’s expanding economic footprint. However, forecasting the impact of unannounced new products and services is beyond the scope of this article.

    The point is Apple will deliver impressive rates of net income growth amplified by the ongoing share repurchase program to provide strong rates of earnings per share growth even on comparatively low rates of revenue growth. It’s my view long-term shareholders will continue to be rewarded with or without the introduction of new and disruptive products.
    Jul 27, 2014. 01:24 PM | 9 Likes Like |Link to Comment