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China Telecom (CHA) says it plans to begin selling the iPhone 5 (AAPL +2.2%) in late November or...
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Friday, November 9, 2012, 12:09 PM ETChina Telecom (CHA) says it plans to begin selling the iPhone 5 (AAPL +2.2%) in late November or early December, a little earlier than expected. During Apple's FQ4 call, Tim Cook would only say Apple expects a December Chinese launch. China Unicom's (CHU) chairman is more cautious in setting a timetable. Meanwhile, RBC is predicting Apple will finally reach a deal with China Mobile (CHL) in 2013, perhaps even before the Chinese New Year - the iPhone 5 doesn't support CHL's TD-SCDMA 3G network. (previous)
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600 million new customers, they have a $450 iphone 4, $550 4s and the premium 5 for $650 to cover the price points.
I think it would mean at least an additional 30 million additional phones sold per year, probably way more.
One article came out from a perma bear when the stock was still in the $660's , and it posted a link to an article warning of an Apple correction. The article was based on the Elliot Wave theory. I wish I'd have heeded that article. It would have saved me from making a lot of bad trades, including some calls I'm still holding onto that expire in January and Februrary.
It also correctly called the previous Apple correction from $644 down to $520's.
Two things I've learned from the past 2 corrections. Apple never goes up in a straight line forever, and when it corrects, it can be a doozy.
As long as it gets back up into the 700's, I should be fine. But my portfolio has taken a hit of over $100,000 just since the last peak. It is somewhat stressful, but I believe in Apple. Thank God my wife never checks the balance or I'd have some 'splainin' to do.
But to think of all the money missed out on, because I didn't want to short the stock. Heaven forbid. Apple can do no wrong!
And all the calls that could have been purchased at much lower prices. I'm holding 615, 640, 650, and 675 calls, when I should have been buying puts on the way down instead. But I always think the stock will do well, especially with all the catalysts it had going for it.
But a lot of hedgies cashed in their chips, and ruined the party. Can't wait til the party starts up again.
Here's a link to that Elliot Waves article, in case you missed it.
http://onforb.es/Ra4AWi
Anybody have any opinions on Elliot Wave theory, please post.
Apple is not Rim, Nokia, Look at David Einhorn's 14% position and belief it can become a trillion dollar company.
People who use apple aren't switching but buying more products. The second hand market tells its own story, everyone wants these products, that trend will continue and grow.
The market can be irrational sometime and this is a classic case and a classic opportunity.
Until we know the numbers, we can't really say what kind of job Apple in general and Tim Cook in specific has done with the iPhone 5. It may very well be that an incompetent handling of this difficult launch would have been a much larger disaster than the reported supply constraints we have seen here. If we knew all the details and saw what the plans were and could see how many were selling and how quickly the production is ramping up, we may think that Tim Cook has done an excellent job in this roll out. Judging Cook solely on what we now see without numbers and back story may be a mistake. It is possible he goofed. It seems more likely to me it was only his genius at the logistics involved in this sort of global roll-out that made it as good as it was.
Can you think of a number of units sold that would make you feel that Apple had performed a minor miracle to get the iPhone 5 out as quickly as it has? Is it 40 million? 50 million? Surely when we get the sales figures on the earnings call we can better assess whether Tim Cook is doing well or not.
Tim Cook is a highly competent manager, but I'd agree w/ you that he's not Steve Jobs. Of course, no one else is Steve Jobs either. The reality is that Steve is gone and I can't think of another CEO who'd perform better than Tim Cook has thus far.
I'd also argue that Tim Cook has released Apple's value more effectively than Steve would have by instituting the dividend and buyback. In terms of supply, the supply is now rapidly catching up w/ demand. Stores now actually have inventory on the shelves. Consider that Steve never had to manage Apple when the demand for its products was at such enormous volumes. Cook has been the supply chain guy right along. Jobs also liked to introduce products at a shortage to stir up interest.
People act as if manufacturing 300 million mobile devices (projected) in a year is a routine task.
My grade for Tim Cook in his first year: B+
I think one of the stumbling blocks is that China Mobile wants a piece of the App Store action. I can only guess that this sits rather poorly with Apple. http://bit.ly/Q6KNvn
WRT supply, some are suggesting that maybe Apple overreached with the design making it so damn complicated to build, it's hindering production.
“It’s not easy to make the iPhones. We are falling short of meeting the huge demand,” Terry Gou said, according to Reuters. His comments echo what an anonymous Foxconn official told the Wall Street Journal last month, that “the iPhone 5 is the most difficult device that Foxconn has ever assembled.” The reason? “To make it light and thin, the design is very complicated,” this person said. http://bit.ly/TD9RHo
PS. Terry Guo, is a Taiwanese tycoon who leads Hon Hai Precision, a company that manufactures electronics on contract for other companies.
I hope that just like they overcame the challenges of 2010 they will overcome the challenges this time around.
I've heard it's costing them more to overcome these challenges. Although I doubt these costs will have any material effect on revenues.
Many say "well, AAPL is up 40 (or 50 or whatever) % for the year so it's been good..." - well, not really. It rose in value in the late winter-early spring season in my opinion because the valuation was compelling - trading in the very low teens multiple and under 10x ex-cash - the price just caught up to the earnings on a very conservative P&G-level multiple. It's not really "up"; the earnings rose and the stock's price multiple caught up with at least the S&P (at, say, 13-14x). The big "run-up" in AAPL was really just the multiple expanding to meet what modest, or low growth, companies are valued. Few S&P components' earnings have grown 50% or 60% YoY. AAPL's did, and even the wildly conservative estimates of 20% in FY13 are way beyond a P&G or even an IBM yet it's valued like them. So Cook can't sit there and say, "well I presided over an exceptional run up in the stock price" because that was really just price catching up with earnings at a flat market multiple - no real premium for the name at all in terms of multiple - so his "shareholder friendly" tenure hasn't been such.
We need some big catalyst and soon, otherwise... the "luster" will have faded. Sure, they'll hit $45 or 50 or 55 of earnings in FY13 but at a 13-14 multiple that's only...well $700, which would be nice, but... ah well...
From what I understand, the iPhone was specifically designed to support that network (see http://on.wsj.com/UF6PFX).