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Apple (AAPL -3.3%) roundup: 1) Shares are near $400 thanks to Peter Misek's note and an equity...

Apple (AAPL -3.3%) roundup: 1) Shares are near $400 thanks to Peter Misek's note and an equity selloff. On top of reporting of high inventories (a reason for Wal-Mart's promotion?), Misek says checks indicate Apple's wafer starts at a Samsung fab used for app processor production "have likely been cut." 2) Global Equities claims "recruiters are seeing more and more employees from Apple applying for jobs" at other tech companies (previous). 3) TSMC (TSM) has scored a 3-year app processor deal with Apple, says Digitimes. Volume production of Apple's A8 CPU, said to use TSMC's next-gen 20nm process, will reportedly start after December. 4) The Supreme Court has rejected an appeal from Mirror Worlds to review an overturned $625.5M infringement ruling against Apple.
Comments (18)
  • positivethoughts
    , contributor
    Comments (1811) | Send Message
     
    Apple under 10 p/e with a 3% yield. Time to buy!!!
    24 Jun 2013, 12:52 PM Reply Like
  • bmwr1200c
    , contributor
    Comments (138) | Send Message
     
    could not agree more
    24 Jun 2013, 01:14 PM Reply Like
  • Stan The Man
    , contributor
    Comments (143) | Send Message
     
    Unrelated to the article, but a possible Apple "development" that nobody seems to talk about...

     

    Does Apple get to write up the reduction in market value of its bonds because of the recent increase in market interest rates? Companies that hold assets (including portfolios of debt instruments) have to mark-to-market and they take balance sheet hits when the value of their debt portfolios go down. The same logic would seemingly require that Apple show an increase to its book vale equal to the difference between what they borrowed ($15 billion) and how much that's worth today on the open market (maybe $13 billion???). Don't know if they have the right to redeem, and presumably that would undo the benefit they achieved by bringing in the cash without returning their foreign cash, but if they did redeem it all they'd presumably recognize this difference on their income statement as well as their balance sheet.
    24 Jun 2013, 01:32 PM Reply Like
  • Dividend Investor
    , contributor
    Comments (16) | Send Message
     
    Under GAAP rules, Apple cannot show a "gain" from the debt they issued
    24 Jun 2013, 01:57 PM Reply Like
  • Stan The Man
    , contributor
    Comments (143) | Send Message
     
    What if they buy them back at a gain?
    24 Jun 2013, 02:43 PM Reply Like
  • Invest84
    , contributor
    Comments (63) | Send Message
     
    Unfortunately this would also require Apple to take a huge hit on all the bonds that they own. So this would likely be a net negative.
    24 Jun 2013, 03:24 PM Reply Like
  • Dividend Investor
    , contributor
    Comments (16) | Send Message
     
    It won't be a negative if Apple accounts for the bonds as held-to-maturity. The losses will only run through the income statement if Apple accounts for the bonds at fair value, which they likely won't.
    24 Jun 2013, 06:24 PM Reply Like
  • Dividend Investor
    , contributor
    Comments (16) | Send Message
     
    Assuming the bonds are callable, then they will run the gain through the income statement; however, they're using the debt for buying back their stock.
    24 Jun 2013, 06:25 PM Reply Like
  • JUDOKA
    , contributor
    Comments (406) | Send Message
     
    They sold the bonds and borrowed for the buyback.They do not hold the bonds.
    24 Jun 2013, 01:35 PM Reply Like
  • Stan The Man
    , contributor
    Comments (143) | Send Message
     
    My point is they still owe the $15 billion for the bonds. They borrowed this money from the bond purchasers. They carry this debt on their balance sheet. Now the market value of their bonds has gone down and they could pay off the $15 billion in debt by buying back the bonds on the open market for something less, like possibly $13 billion. So the $15 billion in debt on their balance sheet should theoretically get marked-down-to-market to around $13 billion, even if they don't buy it back, just as people who bought the debt are required to write down their asset to current market value. It's the flip side for Apple. Writing down the value of their debt would cause a $2 billion increase in net assets (aka book value), and if they actually did buy back the debt that would create a profit that would increase income as well as book value.
    24 Jun 2013, 02:01 PM Reply Like
  • Glenway Fripp
    , contributor
    Comments (828) | Send Message
     
    That sounds really smart to me!
    24 Jun 2013, 04:43 PM Reply Like
  • imac007
    , contributor
    Comments (441) | Send Message
     
    All foundries and suppliers will have completed batch orders. Apple will be starting to assemble in order to supply demand for product launches and start to ramp into holiday season. Apple are not the only customers to these supply chain companies.

     

    Samsung will supply certain application processors by agreement into 2014. They did boost their prices 20% to Apple last year and have fallen out of favor. The $5B worth of business to Samsung is going to disappear. The iPhone 4 processor will no longer be needed in the new mix of products, Samsung supplied it. Those orders would definitely have been cut.

     

    The loss of Apple business to Samsung is coming as contracts expire. TSMC are the largest fab company in the world, so Samsung lost this business to their top competitor.

     

    As to hiring. Assembly companies started hiring early this year at the rate of 10,000 per week. At least 350,000 new hires were going to be needed just to handle the increased demand and ramp going into the second half of 2013. As to Apple employees applying for jobs elsewhere, I suspect it is true. Loyal diehards populating the upper echelon of the company are not providing a place for ambitious underlings to advance. They a checking elsewhere, normal. Just another example of stickiness of key personnel.
    24 Jun 2013, 01:50 PM Reply Like
  • kimboslice
    , contributor
    Comments (1464) | Send Message
     
    Oh goody. Now Apple will be giving me 3 shares (via dividend) by the end of the year if the share price stays low for a bit.
    I can handle it, free shares are compounding.
    Compounding is one way to wealth if you have the patience.
    24 Jun 2013, 04:37 PM Reply Like
  • milehr
    , contributor
    Comments (475) | Send Message
     
    ... and time:-)
    25 Jun 2013, 07:20 PM Reply Like
  • J. Smith
    , contributor
    Comments (112) | Send Message
     
    Mr Cook needed professional help,to prevent the stock from bleeding further. If he does not address the issue, no matter how hard he works, Apple would remain a company that can do nothing right. That is not what the shareholders would like to see.
    Mr. Cook, you needed professional help , right now !
    24 Jun 2013, 04:47 PM Reply Like
  • milehr
    , contributor
    Comments (475) | Send Message
     
    We all need professional help.
    25 Jun 2013, 07:20 PM Reply Like
  • croatkid1
    , contributor
    Comments (189) | Send Message
     
    Peter Misek's note and an equity selloff??
    says checks indicate Apple's wafer starts at a Samsung fab used for app processor production "have likely been cut."

     

    Just what we need; another analyst coming out with "his thoughts" including that definite "likely" which is exactly as definite as the rest of his garbage which is always noted as worthy of further thought.
    24 Jun 2013, 06:07 PM Reply Like
  • ML610
    , contributor
    Comments (87) | Send Message
     
    Why isn't anyone talking about this as a potential weakness at Walmart? Traffic driver maybe?
    25 Jun 2013, 12:36 AM Reply Like
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