Seeking Alpha

Rookie IRA Investor

View Rookie IRA Investor's Comments BY TICKER:
  • Why You Should Buy Apple Now [View article]
    I would have thought EKG would be range bound.
    Mar 11, 2013. 09:11 AM | 1 Like Like |Link to Comment
  • Why You Should Buy Apple Now [View article]
    Terrific article, very comprehensive, incisive, and accurate. No further comment necessary.
    Mar 10, 2013. 09:18 PM | 15 Likes Like |Link to Comment
  • Apple: Learn From Andy Zaky's Mistake [View article]
    To trade options, at the time that you enter a position, you need to have already planned what you are going to do if the position moves against you, and need to also plan what you are going to do if your plan B goes against you. Usually this means using some type of Martingale system combined with stops and some kind of hedging. Due to the leverage of options, a large part of the portfolio should be held in cash or equivalents.

    I think it would be incredibly difficult to trade with millions of other people's money without being tempted to hit for the fences rather than bunting for singles.
    Mar 8, 2013. 07:24 PM | Likes Like |Link to Comment
  • Apple: Learn From Andy Zaky's Mistake [View article]
    The interesting point is that if enough people believe in the head and shoulders theory, they will start to buy at $360 making it a self fulfilling technical indicator.
    Mar 8, 2013. 06:07 PM | Likes Like |Link to Comment
  • Apple Can Recapture Old Magic By Looking To The East [View article]
    "What Apple has failed to grasp so far is that China's newly enriched consumers cannot afford its products."

    I think Apple is perfectly well aware of this. The company will have a strategic plan, though such things are not published for general consumption. Whether this will include a cheaper iPhone under the Apple brand or more creative ways of financing the sales of phones, I do not know.
    Mar 8, 2013. 08:12 AM | Likes Like |Link to Comment
  • Apple: Learn From Andy Zaky's Mistake [View article]
    I like AAPL because it is big, everything is known about it, and the share price is high, making it viable to trade options profitably if done right. In addition, if it gets down to something like $350, it will be relatively safe to sell puts due to the cash hoard and the dividend.

    The narrowing margins do worry me a bit, but on the other hand there are any number of potential positive catalysts that might occur in the future. For example AAPL might develop a really good all in one educational tool that could become as standard for the students of the future as the pencil box once was, or any number of other as yet unimagined products. With such a vast hoard of cash AAPL has the potential to acquire any technology it wants and the best and most creative people available anywhere in the world.
    Mar 7, 2013. 01:00 PM | 2 Likes Like |Link to Comment
  • Apple: Learn From Andy Zaky's Mistake [View article]
    Those people who bought AAPL at $10 are still way ahead of the game.

    I missed out on the run from $350 to $700 and am still looking for an entry point. I still think it goes lower from here, and there may be tax-loss selling in late 2013.
    Mar 7, 2013. 09:44 AM | 2 Likes Like |Link to Comment
  • Apple Is Still Cool [View article]
    "Apple is still the world's most dominant and most valuable brand name that generates loads of cash while posting growth and beating estimates quarter after quarter."

    The recent fall in the stock is because it seems likely that growth is slowing and that APPL will not be able to continue to post growth and beat estimates. The spread of the iPhone to carriers other than AT&T in the US and the release of the iPad and iPad mini led to explosive growth, but whether this will continue is a moot point.

    The field for potential new products is somewhat limited. While AAPL might be able to parlay its brand name into more products such as the iWatch, iToothbrush, iLightbulb, iToaster, iCoffeeMaker, and iCanOpener, the huge profits and margins realized with earlier products will not be there.
    Mar 5, 2013. 06:41 AM | 5 Likes Like |Link to Comment
  • Apple May Be Deadweight Now, But Just Wait Until The Next Great Innovation Is Released [View article]
    True but $300 per share would take the dividend to over 3% even without any future dividend raises.
    Mar 4, 2013. 08:45 PM | Likes Like |Link to Comment
  • Apple May Be Deadweight Now, But Just Wait Until The Next Great Innovation Is Released [View article]
    Yes, AAPL at $450 looks like a buy, but how many people are really confident that it can't be had for less?

    You could sell the 2015 $450 put right now and make a nice percentage return over 2 years if the stock just holds $450. The only snag here is that you probably don't have $45,000 in your account to buy 100 shares of AAPL, and even if you do, it will very likely make your account overweight in AAPL.

    So how about you sell the 2015 $450/400 put spread? You only need less than $5,000 in your cash or margin account and after all, worst case scenario is that you lose less than $5,000 if the stock goes below $400 on expiry. How many people here are 100% or even 90% confident that trade would be profitable?

    I don't think anyone really knows where AAPL stock goes from here. It is certainly a waste of time going by analyst opinions, which can only be the roughest of guides.

    Yes, AAPL has a mountain of cash and is still a tremendous cash cow, but the real question is for how long exorbitant margins on smart phones can be maintained. What if margins on smart phones are cut by 60% three years from now, what does that make the stock worth?

    Yes, maybe AAPL will invent the solar-powered personal flying car/helicopter with autopilot and sell it on contract for $250 per month including life insurance,Google maps, and 1 billion apps, but Cupertino sources tell me probably not.

    I still like AAPL, but I want to buy it for $350. Selling $300 puts looks pretty safe to me.
    Feb 27, 2013. 05:56 PM | 1 Like Like |Link to Comment
  • Is Apple Just Boring? [View article]
    "However there is a reason that developers prefer the iOS platform and it's where all the innovative apps show up first."

    No, it is because Apple users pay more and buy more often and potentially there is more money to be made from developing Apple apps. Always follow the money.
    Feb 25, 2013. 09:19 AM | 1 Like Like |Link to Comment
  • Will Apple Exist 3 Years From Now? How Much Will It Be Worth? [View article]
    "Start with the "cash horde""

    Better still, with the cash hoard.
    Feb 23, 2013. 06:15 PM | 1 Like Like |Link to Comment
  • Will Apple Exist 3 Years From Now? How Much Will It Be Worth? [View article]
    I don't think its real estate holdings are significant when compared to the $140 billion or so in cash.

    I don't think its patents are worth much because it hasn't done the basic telephony research to make smart phones technically possible. Its patents seem to be more in the line of design patents.

    Apple claims to have invented the idea of sliding a bolt to lock or open something, but really the concept has been around since Roman times. Transferring it to a touch screen and claiming something new is pretty dubious, and surely not hard for competitors to work around. Apple didn't invent the touch screen itself which is where the real patent value lies. The invention of that basic technology goes back to the 60s and 70s.
    Feb 22, 2013. 05:46 PM | Likes Like |Link to Comment
  • Will Apple Exist 3 Years From Now? How Much Will It Be Worth? [View article]
    This is a good article and makes some excellent points to get started with. Hopefully future articles could consider where Apple might go in the future.

    The article so far makes the argument that Apple does not have much of a moat, but is this really true?

    The history of computer operating systems, especially for portable devices suggests that only huge multinationals like Google, MSFT, and AAPL can ever develop and maintain operating systems over the long term due to the immense complexity of such an undertaking--so it will be very hard for any newbie to break in and develop a rival to Android, Windows, or iOS.

    The future of Apple might therefore lie in the direction of expanding the reach of its operating systems to licensing its use in the products of other original equipment manufacturers. Since AAPL already bears the cost of maintaining its operating systems for its own devices, margins would be astronomical though limited only by the need to compete with the free-to-manufacturers, though erratic Android.

    The other obvious area for Apple expansion is into the area of business and enterprise (education, government, military, healthcare) computing.
    Feb 22, 2013. 10:58 AM | 2 Likes Like |Link to Comment
  • Apple: Is Tim Cook The Next Steve Ballmer? [View article]
    Bit of a difference. Ballmer was a college pal of Gates at Harvard and was employee #30 when he joined MSFT in 1980 as business manager. He dropped out of an MBA program to join MSFT at the age of 24.

    When Microsoft was incorporated in 1981, Ballmer owned 8 percent of the company.

    So he was more or less one of the founders of the company. No he wasn't a programing wiz like Gates, but for all we know a lot of the business strategy of the company may have come from Ballmer as much as from Gates and he may have played a large part in getting the company from a small start up to a huge multinational.

    Cook got his MBA at Duke and spent 12 years at IBM, presumably at the part located down the road from Duke, near Durham, N.C.

    One gets the impression that Ballmer is more of an all around intellect than Cook who comes across as very "focused" on business.

    Cook was first hired at Apple as with a mandate to clean up the atrocious state of Apple's manufacturing, distribution, and supply apparatus.

    Cook is credited with pulling Apple out of manufacturing by closing factories and warehouses around the world. This helped the company reduce inventory levels and streamline its supply chain to match the efficiency of Dell Inc., dramatically increasing margins. Cook has been quoted as saying "You kind of want to manage it like you're in the dairy business. If it gets past its freshness date, you have a problem". [Wikipedia].

    So Cook is the business efficiency guy, yes, but not much to suggest that he is a creative genius or leader of men. (Maybe he is, but there isn't much in the public forum to suggest this is so.)

    Ballmer was there from the start, but his strategic decision making as CEO has been suspect.

    I do agree that Cook's leadership ability may be suspect. He may have great critical ability to see what is wrong with a process and how to improve it, but this doesn't necessarily parlay into any visionary qualities regarding products.

    Jobs' greatest ability was probably that he could visualize products that he would like for himself and inspire other people to get them made so they might be enjoyed by others. His ability to run a large corporation on a day to day basis may have been overestimated, and had he not been a founder of the company, I doubt whether he would have risen in the corporate structure.
    Feb 20, 2013. 10:29 AM | 8 Likes Like |Link to Comment
More on AAPL by Rookie IRA Investor