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The selloff in Apple (AAPL) has reached the point of "insanely insane," says Topeka's Brain...
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Monday, November 19, 2012, 7:50 AM ETThe selloff in Apple (AAPL) has reached the point of "insanely insane," says Topeka's Brain White, arguably the Street's biggest bull on the stock. Uber-bull or not, maybe he's got a point. Those selling Apple at a sub-10 PE while holding onto or buying Company X - with no earnings growth, selling at a 20 PE, but yielding 5% - may look back one day and wonder what they were thinking.
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Making 50B a year for 10 yrs would actually pay us back ALL our investment AND still leave us with all our holdings.
That's NOT breaking even. That's a very attractive deal
Also, nobody forces anybody to hold anything for 10 years.
Would you commit to holding MSFT, IBM, INTC, ORCL for 10 years? and people still trade these stocks
For me once AAPL's expected cap growth levels at 15%/year, I sell.
Certainly not now
Selling now is panic.
That's not what Buffet recommends "when everyone is fearful..." well everyone has been fearful for the last 8 weeks
BTW, in recent years ir was AAPL who made others look like toasters. WHo make make AAPL look toaster?
MSFT with it's wheel chair?
If everyone thinks that Apple is worth holding only until next year where does that leave us? Knowing that you and many others are planning to dump your AAPL next year makes me think I should be quicker than you and sell now.
I don' wish it to happen but it's a perfectly possible scenario.
This is no big deal for funds which hold hundreds of different companies and Apple is just 1-2% of the portfolio. But for individual investors with 10% + hodlings in Apple it could be quite a serious shock.
Apple’s (AAPL) VP Sells Nearly $11M in Stock
By WSP Nov 17, 2012, 7:33 AM Author's Website
Apple’s (AAPL) newly appointed Senior VP of Hardware Engineering Dan Riccio has sold 20,726 shares, or nearly $11 million worth of company stock this week with a small part of the profits going to charity.
According to a filing with U.S. Securities and Exchange
Commission, Riccio sold off the shares in two separate trades on Thursday and Friday at stock prices ranging from $526 – $532 per share. Riccio also made a donation of 1000 shares, worth roughly $527K to an unspecified charitable organization.
At Apple’s last closing 527.68 price-per-share [PPS], the total value of the stock sold was over $10.73 million.
http://bit.ly/UR1sEN
Insiders selling doesn't mean anything too. Maybe the guy needs to buy a new house/island. But if you know that insiders are BUYING then you too should buy, buy, buy! ;-)
2. Earnings across the S&P are peaking baby. Tomorrow is smaller than today, not bigger.
The smart money know this and are out already.
Costs are coming down significantly, in some cases to zero, for an always-connected all digital lifestyle.
Consumers can get far more now for so much less, and their gadget time is a finite resource that is quickly being consumed.
Sorry, while mobile and tablet apps are here to stay, this isn't a growth story anymore in terms of hardware. When people "plan to buy smartphone" in the next 18 months, that will probably be on craigslist.
Or they'll just buy a used tablet and use skype or google chat. $0 in revenue for the manufacturers and similarly $0 for the carriers.
Often times the peak in a stock price precedes a downturn - in the company, or in the economy. Things seem the most exciting and rosy numbers get batted around the most at the peak. I think a lot of people have seen this with AAPL stock and its products. They'll continue to be a profitable company, but their days as a leader and high flying stock are over.
The market decided this, not me!
By this time next year, AAPL will again fall down to earth and all the anti-AAPL bears will wake up from their hibernation to pronounce the death of AAPL.
Again, the news of AAPL's demise is a bit exaggerated.
Lot of tomfoolery....
So I've got to wondering, why are we trying to help them? Just buy. We should probably be encouraging their nay-saying.
I don't quite understand why so many people who are neither short nor long are here, and why they care so much.
@Ballin, good points.
- CSCO in 2000/2001
- RIMM in 2008/2009
- AAPL in ... ?
Get FB while it's cheap. The founding CEO has a good 30 years left in him and is nowhere near his own personal peak.
Common financial phrase: "past performance is not indicative of future results."
the 128 B (not 100 B as first commenter said) cash hoarde seems to be very important to me - and while it is constantly referred to in articles and comments, the projected cash that AAPL should have on hand over the next few years seems even more important. A year ago, everyone was agog at 75B or so in cash... then 100, now 128, where 6-12 months from now? even assuming shrinking margins and slowing rev growth, this number will not stop growing for what, 2-3 years ?
conservative 12-15% rev growth, 2% div, healthy margins and a global ecosystem w/several hundred mllion loyal and happy user base - plus all that cash...at a high single digit forward P/E
Sorry to oversimplify (yeah, margin compression etc.) but the bear case seems pretty weak looking at these figures.
so the question - reasonable guess as to cash on hand 12 months out? 18-24? 200B within sight.. Apple w/200 b in cash and a $ 750 px now seems reasonable...
I don't exit options unless I've made 75% or I've lost 40%. A single intraday reversal would destroy your position.
Statistically, you're playing a losing game.
and no, one does not own a company for the cash on hand, but really, a potentially 150-200 billion treasure chest doesn't impress you ? Would you rather they invest in a few startups just to get it off their hands or perhaps go out an float some Apple bonds to have a more traditional balance sheet?
and as far as the cult of Jobs - he was visionary enough to build a sustainable organization. You make him out to have had super-powers or some preternatural ability to run a massive organization all by himself. Jony Ivy, and yes, Tim Cook, et al are human beings, like Steve Jobs was -very smart, and very focused humans that tackle the questions bandied about on this site about the next phase and margin compression etc etc 24/7. They'll make mistakes - just like Jobs did, but really, its been a year since his death, the most successful year, arguably, in corporate history - and if all you've got is the maps issue, sorry, not buying it. (and JCP / Johnson? not sure the point, they let a senior guy go - at least he didn't go over to MSFT to run their stores...)
and finally, Apple has never been about the low end of the market. Tata sells alot of cheap cars too, not sure Mercedes is too concerned.
As for Jobs, I said he was visionary, and that he was very smart. Fine, he was very, very smart.
Thanks for the advice on checking up on history that I'm already aware of - just not sure how its a straight line from Jobs not being at the company to things falling apart. Remember, he was also out of commission - maybe 50% effective - in the last year, possibly longer, while dealing wiht his cancer, so the fact is that the stellar 3 year run the company has had is most likely the result of smart decisions and great execution by the C suite guys, w/Jobs really being more of a team player than ever, and also an inspiration, which I do think is his lasting legacy. To me, that is potentially more powerful than his actual presence. If they can keep his vision alive, creating and selling simple, elegant, and innovative devices, their future looks very bright.
I'm going to guess you have an android, but of course, that is ad hominem logic :)
Dark horse: a stock split.