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Saying Apple (AAPL) has reached the "trading toy stage," Robert Sinn reminds of the track record...

Saying Apple (AAPL) has reached the "trading toy stage," Robert Sinn reminds of the track record of other stocks that have recently garnered the public imagination - it's not good. "Volume and volatility create action, excitement, and opportunity. However, the action we are currently witnessing in Apple is not healthy."
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Comments (20)
  • 7footMoose
    , contributor
    Comments (2266) | Send Message
    I read the full article. It says nothing. He's either looking for hits on his blog or jealous of those who own Apple. I am not included among the owners.
    14 Mar 2012, 03:15 PM Reply Like
  • Husky Financial
    , contributor
    Comments (212) | Send Message
    so you believe that 40 points in 5 days and 200 points in 180 days is "healthy"? I don't think that someone poking holes in the present day investment thesis for AAPL is neccessarily "jealous" or "looking for blog hits"... i think many level-headed investment minds will agree this bad boy's run has gotten way ahead of itself.
    14 Mar 2012, 03:18 PM Reply Like
  • SA Editor Stephen Alpher
    , contributor
    Comments (545) | Send Message
    I agree. Sinn has never struck me as a guy just looking for hits, nor as a bearish sort. His comments on the Apple action being unhealthy may or may not be right, but certainly are worthy of being part of the discussion.
    14 Mar 2012, 03:23 PM Reply Like
  • 7footMoose
    , contributor
    Comments (2266) | Send Message
    Did you read his whole blog comment?
    14 Mar 2012, 08:08 PM Reply Like
  • f4ftrjoc
    , contributor
    Comments (14) | Send Message
    Well, in Econ 101 it states: Build a wiggit that as long as it has public support and "look alikes" can't touch it....Then ride it fast and long. It is not like "Nixflix", with copy cats able to hog in...I can 't tell you several stories of those that I advised to buy AAPL and what they have been able to do with the profits...Nothing last forever, but AAPL has a long way to go....
    14 Mar 2012, 03:51 PM Reply Like
  • Herr Hansa
    , contributor
    Comments (3080) | Send Message
    It's supply and demand. Many who hold AAPL shares do not want to sell them, while many more want to buy. The same imbalance of demand over supply of shares happened with QCOM in the past, and similar things happened with several other companies. Besides that, in a market correction, AAPL would not be immune from sliding downwards with everything else. We've had quite a run-up recently, and realistically the economy is just not that great.
    14 Mar 2012, 04:02 PM Reply Like
  • nightfly
    , contributor
    Comments (1017) | Send Message
    Too much cheap money chasing "sure things...", this is how the .com bubble happened.


    Right now, equities are the only place to put that free money... nothing else is as "safe", short memories and greed will sure to be punished again and again.
    14 Mar 2012, 04:15 PM Reply Like
  • Juangatoman8
    , contributor
    Comments (18) | Send Message
    I believe Apple's current and projected sales, profits, sound management, strong bench, pipeline of attractive products, incredible cash reserve, commitment to excellence in design & function, R & D, PE, PR etc. justify the PV.
    To me, they suggest a run to $700 over the next 12 months, barring, war, tsunami or such cataclysmic global event(s).
    I also expect the stock will occasionally pull back a bit now an then on that run. I have no idea what the upper limit on the stock might be in years to come, but like other once bright gems, it could slowly lose its luster over time..
    At present value, a wise investor either has profit protection in options or stop limits in place, IMHO
    14 Mar 2012, 04:27 PM Reply Like
  • jimbn
    , contributor
    Comment (1) | Send Message
    and the fairly common call on it right now is a target of 660 by year-end.
    14 Mar 2012, 04:30 PM Reply Like
  • mrodriguez1440
    , contributor
    Comments (2) | Send Message
    Can anyone comment on why they think there will be a correction in the Apple stock price? Also, when do you think that correction will happen, and what Apple will fall to when it does happen.


    Additionally, please explain why you think there will be a correction. Is Apple overvalued? Is the stock prices some how not in sync with Apple earnings?


    I would love insight. Currently, I own two macbook pros, a macbook air, 2 iphones, and 2 ipads. I cannot imagine life without Apple. Furthermore, every time, and I mean every time, that I walk into an Apple store, it's packed wall to wall with customers.


    Why is that? I think it's because once you buy an Apple product, you're part of the Apple family. You may think what I'm saying is stupid, but take the iphone as an example. When you buy an iphone, and you have issues with it, you go back to the Apple store and they help you. You buy a Samsung, Nokia, or HTC, and you have an issue with it, what do you do? Go to the at&t or Verizon store (two crappy options).


    So I'm curious, when will this correction happen?
    14 Mar 2012, 05:04 PM Reply Like
  • Juangatoman8
    , contributor
    Comments (18) | Send Message
    I absolutely do not think that Apple is over valued.
    However, all securities are subject to market risk, no stock has ever experienced a pure linear run to its apogee. Apple has had days when the share value retreated with the broader market in the run from near bankruptcy, when Steve Jobs returned as a "consultant" until the explosion of the past year.
    I'm not sure how you define a correction. But a pull back in the 5% - 10% range is not unprecedented. If it were to do that, I would use the "correction" as a buying opportunity.
    Assume you accept a 5% - 10% drop as a correction. If so, it could come any time, not only for business reasons, but for an unexpected event or a general market retraction or any other phenomenon your imagination can drum up.
    The old cliche is greed and/or fear trump logic when in near term stock valuation.
    In the long run, true value can always be found in the numbers. (Sales, revenue growth, margin, cash flow, etc.)
    14 Mar 2012, 06:00 PM Reply Like
  • Three Cheese Fondue
    , contributor
    Comments (632) | Send Message
    You might not be able to imagine a life without Apple, but I can.
    Ever since I bought an iPod nano and its battery died on me a couple or so years later, leaving me with a worthless product (unless of course I was willing to order a replacement from, and to be fitted by, Apple at around 98% of the original cost of the thing) I've vowed to stay away.
    Still, I believe they probably do make great products, and have something of a religious following (of which you are an example, but you are happy, so there is nothing wrong in that), so there is a fundamental backdrop to all this bullishness. But then they do say, don't they, that every bubble has a fundamental underpinning to it.
    It's just when expectations get out of hand that things get messy.
    14 Mar 2012, 07:43 PM Reply Like
  • fauxscot
    , contributor
    Comments (518) | Send Message
    No offense meant, honestly, TCF, but to ditch the Apple product line based on a Nano? Let me tell you of some interactions with Apple I have had:


    I broke a brand new Macbook LCD. Was my wife's. She was in law school and could not tolerate weeks with no computer. I bought her a new one, and set about getting it fixed. Apple declined and my insurance declined to fix the box. I priced a replacement LCD from Apple. Too much. Sold it on eBay for $750. When I went to cancel the AppleCare agreement, they refunded the entire price of the AppleCare PLUS the computer, since there was a recall on for the LCDs and my computer was involved. $1500. I wound up $750 to the good.


    I needed a replacement part for a power supply. Went to the Apple store. Tech said "We don't sell that part, but here, you can have this one". No argument, no stress, no cost.


    I got an iPad2 for christmas. It was a 16GB model. I decided I needed 64GB. Called Apple and bought a new one. They threw in a $69 leather cover for free, just because because.


    I have a dozen other positive customer service stories from friends. You are missing out on great products, great service, a great company based on a $150 problem. I respectfully and honestly suggest you should perhaps reconsider. See why it is that folks get 'religious' about this outfit. It'll make your investing wiser, I suspect.


    Good luck, regardless.
    14 Mar 2012, 09:27 PM Reply Like
  • Three Cheese Fondue
    , contributor
    Comments (632) | Send Message
    No offence taken, fauxscot. You've had a good relationship with Apple, and, like I say, I accept that they probably (almost certainly) make great products. My main point is simply that it is something of a trading saw that all bubbles have a decent fundamental backdrop behind them, which simply gets out of hand *at some point*. We could be far from that point with Apple - who can tell.
    Myself, I will not go back to them. I do actually have a Hackintosh, that I built myself but only cos I didn't really have a choice (there was some Apple-only software that I needed). I was damned if I was going to pay $2000 for a shiny silver box. Some of us don't forget, you know :-)
    14 Mar 2012, 09:52 PM Reply Like
  • califa
    , contributor
    Comments (21) | Send Message
    So many people have an oppinion on AAPL,that's good,and we are in a free country,so every oppinion is valid...and I notice that many holder of strong sentiments about AAPL do NOT hold the name,well
    are you not cutting your self short?And how come you have such strong oppinion on some thing you do not own?Why don't you look at the the past or the present,the values the demand...
    THE POSSIBILITIES,and while you do that make sure "The Train" do not run you over....Is wonderful world,and life is beautiful...oh yes count your blessings and find a way to buy some AAPL.....
    You will feel even better. Califa
    14 Mar 2012, 06:20 PM Reply Like
  • DeepValueLover
    , contributor
    Comments (8659) | Send Message
    When longs become enamored of a stock and defend it like cult followers speaking about the cult leader...


    ...and the stock chart goes parabolic...


    ...and the product the company produces is highly popular but not essential to life...


    ...and the industry its in is notorious for sharp, unexpected swings in consumer sentiment...


    ...and its hyper-popularity begins to spawn a small but fast growing backlash...


    Well...a sharp and violent correction may be in the cards sooner than later.


    And remember...I, too, think AAPL is cheap here.


    But "value" and "trading psychology" have a long history of going to war.


    Its NOT different this time.
    14 Mar 2012, 06:40 PM Reply Like
  • berylrb
    , contributor
    Comments (2206) | Send Message
    I'm one of those LONG on Apple types, and frankly even a 10-15% pullback won't hurt my position, in fact it won't even hurt those who increased their position in December 2011.


    I've yet to see an article which researches exactly who all these new buyers are? With 50.6M shares changing hands today, most suggest that this is not the small investor's irrational exuberance rather institutional plays. I agree with Robert Sinn's hypothesis about the health of these trades, but if it truly is predominantly institutional buying, we're talking professional not small fry like myself. They would no better, eh?
    14 Mar 2012, 06:59 PM Reply Like
  • gerry_miranda
    , contributor
    Comments (9) | Send Message
    If the institutional investor wants to beat their benchmark SP500, they better have AAPL, because owning the other 499 could leave them lagging.
    14 Mar 2012, 07:28 PM Reply Like
  • todd.kaime
    , contributor
    Comments (94) | Send Message
    I read that a lot of hedge funds are buying apple. Even those that are supposed to be dividend only or small cap only or whatever. Everyone wants to have a piece of apple. No one wants to explain why they didn't have any apple in their portfolios.
    14 Mar 2012, 10:51 PM Reply Like
  • MarkS2002
    , contributor
    Comments (203) | Send Message
    A 10% correction would still leave it well north of $500, and it only crossed that line in the run up to the iPad announcement. Really, it would have to dump about $100 before it caused any great queasiness; and given the robust sales of the new iPad and the LTE iPhone still to occur this year, it would likely not remain at those values any longer than it took Goldman to gobble them up.


    No matter what traders and the bulls may do to today's stock price, it is an amazingly well managed company, and that is what will drive value in the stocks. Every company should run in such an efficient and focused manner.
    14 Mar 2012, 07:22 PM Reply Like
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