Seeking Alpha

Tri Duong

 
View Tri Duong's Comments BY TICKER:
  • Apple With 3.50% Yield Can Reach $203 [View article]
    V2,

    If you are a long term investor, then you will care about the company as it is the only way your shares will be worth anything down the road.
    Oct 10, 2014. 03:14 PM | Likes Like |Link to Comment
  • Apple With 3.50% Yield Can Reach $203 [View article]
    He owns the most shares and he is the one making decisions so how much do you think he cares about other shareholders?. This is all about Icahn. Just from a volatility standpoint, this is a bad plan. Apple endures a lot of risks in this industry and that's why they are known to be very oppressive with their suppliers.

    If Icahn can force Apple to deplete its cushion for his benefits, all it takes is one bad iPhone or any malfunction with a major supplier to rock the company.
    Oct 10, 2014. 02:46 PM | 1 Like Like |Link to Comment
  • Apple With 3.50% Yield Can Reach $203 [View article]
    That's not what I'm saying at all. I'm telling you he's on his own agenda with his own time schedule. If yours does not align with his, because he won't tell you what his time line is, then you may be screwed when he dumps his shares.

    Did his actions help shareholders that were in earlier this year? Yes
    Would his actions continue to help shareholders later? No, not really

    The only person that benefit then, now and later is Icahn.

    Can all these massive buybacks and dividend increase hurt Apple in the future? absolutely! Lowering cash in a high risk market will hurt them when they are in trouble. Why they flop the next iPhone and EPS drop to the floor, they won't be able to keep paying out the same high dividend suggested. That will affect share prices. Both EPS drop and lower dividend will send the stock plummeting. Of course, Icahn will be long gone before that happens.

    Guess what happens when Apple flops and have to tap into their cash reserve that's been raided for buybacks and dividends? it will send it too low and they're forced to take action to keep it at optimized level. So what will Apple do? issue stocks or more debt? most likely issue stocks as taking up debt will yield a higher interest and further deplete their margins. But the stock price is in the dumpster by then so they are forced to sell more shares to further dilute current shareholders.

    Considering all that, there's a reason why I hate what Icahn is doing. Apple is a blue chip stock and one of the largest. A lot of retirement accounts depends on it now that it has dividends. You could see millions of retirees hurting depending on the size of their investment.

    I just don't see how Icahn's actions are benefiting anyone in the long run. I can see short term benefits. AAPL being "cheap" is relative and subjective depending on how you look at it. I think it is just average at this point. There's stocks that are cheaper. Just to be clear, what Icahn is doing looks like "pump and dump"
    Oct 10, 2014. 02:32 PM | 6 Likes Like |Link to Comment
  • Apple No Longer Seems Massively Cheap, Even Ex-Cash [View article]
    Exxon can be reliant on oil because people and the entire economy is dependent on oil. Even if all cars are EV, most of the energy for that will come from oil.

    People are not reliant on iPhones. They buy it because it is a top notch phone with good software. When iPhones start sucking, you can bet people will not be buying it like they do. Look what happened to HTC and Blackberry.
    Oct 10, 2014. 02:17 PM | 1 Like Like |Link to Comment
  • Apple With 3.50% Yield Can Reach $203 [View article]
    You notice Icahn brokered the deal to buy the stock first before he tells everyone he's buying up AAPL?

    He will also dump the stock first before he tells it's now overpriced.

    The lesson to learn here is Icahn doesn't care about other investors or Apple. If Apple goes with his plan to pump up the stock price even more then all future shareholders will lose money. It's just equivalent exchange. Somebody has to lose money for someone to gain money unless you're the Feds.
    Oct 10, 2014. 02:01 PM | 12 Likes Like |Link to Comment
  • Apple With 3.50% Yield Can Reach $203 [View article]
    "I am not the sharpest knife in the drawer. Could someone explain how the share repurchases created value for the firm?"

    Share repurchase decrease the number of shares so the EPS goes up. When EPS goes up, so does share price. If you are Icahn holding 53M shares, then you want Apple to do share buy back. He will get capital appreciation.

    Apple stock went up about 50-60% and will have a hard time pushing it up. Now, it is good to ask for higher yield as his 53M shares will be a cash factory. He would get more money per share as there is less shares to spread the earning around.

    So yes, Icahn does not really care about Apple. He cares about his pocket.

    "Investors must sell stock for cash in a share repurchase and economics 101 suggests that selling can place downward price pressure. Buying stock creates upward price pressure and to enjoy a dividend one must own or buy the stock."

    Share repurchase doesn't decrease price. Share repurchase is BUYING stocks. This actually creates an extra demand for the stocks because shareholders don't suddenly just increase sell orders. That is why Apple stocks was on a steady increase.
    Oct 10, 2014. 01:34 PM | 11 Likes Like |Link to Comment
  • Apple No Longer Seems Massively Cheap, Even Ex-Cash [View article]
    If you want to compare the chances of Apple flopping the next iPhone to a large meteorite wiping out Earth; that's like comparing flipping a coin vs winning the Mega Millions lottery.

    For almost everyone out there. They're not enjoying their "affordable" iPhones because of Apple stocks. I'm going to go out on a limb and say their jobs is paying for it.
    Oct 9, 2014. 01:43 PM | Likes Like |Link to Comment
  • Apple No Longer Seems Massively Cheap, Even Ex-Cash [View article]
    No kidding, but that's not what we're trying to say. We're just showing you how they "value" these stocks and how the numbers work.

    It's backwards, I know. It doesn't make sense that Apple buys back shares and suddenly their company is worth more because EPS is up. However, that is the result since equity valuations are based on these ratios.
    Oct 9, 2014. 01:31 PM | Likes Like |Link to Comment
  • Apple No Longer Seems Massively Cheap, Even Ex-Cash [View article]
    "Reliance on iPhone is falling, not rising. And it is not 60%,...that is already an exaggeration. The iPhone sales and earnings will continue to rise (YoY), as that same total falls in proportion overall sales, all through 2015"

    Hawk,

    If you're going to tell someone they're wrong then please back it up. Apple's iphone proportion to revenue had been rising since 2009 from 24% to as high as 58%. The little fall you saw happens every year because sales will come down after the the initial launch quarter. In short, it's seasonal fluctuation. The overall % of sales for iPhones have only been going up.

    So Apple's revenue is in hyper growth and but their iPhone's proportion to revenue is rising. That means iPhone sales growth are at a much higher rate than all their other products combined. That's alarming as iPad sales are lowering and iPods disappearing.

    The point is that Apple is not really diversify. Why?

    1. Iphones are the main source of revenue
    2. The highest margins is iTunes and app stores which is highly dependent on iPhone sales.
    3. iPhones are the gateway device now that iPods are almost completely gone.
    4. iPads business down and hopefully will revive with 12" ipads
    5. Their only other business that brings in good profits are the macbooks.

    So if iPhones flop in the next 2 years, you can expect most of their profits to disappear as well.
    Oct 9, 2014. 01:26 PM | 7 Likes Like |Link to Comment
  • Apple No Longer Seems Massively Cheap, Even Ex-Cash [View article]
    If you look up enterprise value, cash is actually negative value.
    Oct 9, 2014. 01:00 PM | 1 Like Like |Link to Comment
  • Apple No Longer Seems Massively Cheap, Even Ex-Cash [View article]
    It's pretty clear that Carl Icahn is looking out for Carl Icahn. He can hire the best to provide a compelling argument pushing Apple to do what he wants. At the end of the day, Apple didn't get to where they are because of Icahn. They got here because they are businessmen and innovators. Icahn is an investor.

    You should never wholeheartedly agree with Icahn because you know he is biased. What he's doing is forcing Apple to buy back more shares so their EPS increases. Their debt will rise which will cause their enterprise value to rise. The share price will also rise and that's his goal. You can be sure that once Apple reaches a target price, he will be out.

    If you know anything about business instead of investing ratios nonsense, then you would know that lowering cash reserves in a high risk business is as risky a move as putting all your money into the OTC market. Apple's iPhones are nearly 60% of their business and where most of their profit comes from. One flop could wipe out almost all of their profits for that year. If they don't have the cash reserves, they cannot execute and double down on R&D to make sure their next iteration is successful.

    An investor's interest does not align with a business's interest even though both their end goals are the same.
    Oct 9, 2014. 12:51 PM | 14 Likes Like |Link to Comment
  • Apple: iPhone's Growth And Market Share Declining? Not Really [View article]
    There's no confusion. Apple is trying to make money, not just break even. They won't go for the low end market. It'll kill their brand image chasing it.
    Jun 28, 2014. 10:54 PM | 1 Like Like |Link to Comment
  • The Genius Of The Apple iPhone 6 [View article]
    Moto X phone is American made
    http://bit.ly/1qevq4F
    Jun 26, 2014. 10:21 AM | 2 Likes Like |Link to Comment
  • The Genius Of The Apple iPhone 6 [View article]
    If you live your life buying only American products, you will spend most of your days trying to find where those Americans products are.

    BTW, it's Americans who moved those jobs overseas. Stop acting like they stole our jobs. They didn't because we moved it there since Americans doesn't like working for $2/hr in a sweat factory.
    Jun 26, 2014. 10:08 AM | 26 Likes Like |Link to Comment
  • Apple: iPhone's Growth And Market Share Declining? Not Really [View article]
    Google license agreement doesn't limit any vendor from selling low end or high end phones. Basically, they don't have control over what type of Android phone goes where. The vendors make those decisions.

    Google makes billions in earnings. It's just nowhere near as much as Apple.
    Jun 25, 2014. 02:27 PM | 1 Like Like |Link to Comment
More on AAPL by Tri Duong
COMMENTS STATS
1,497 Comments
5,083 Likes