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Davidoff

Davidoff
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  • Kuwait signs $12B LNG supply deal with Shell, $3B with BP [View news story]
    No, seriously?
    May 12 02:16 PM | Likes Like |Link to Comment
  • Apple + Beats: Cutting Through The Hype And Negativity [View article]
    6228371,

    Let me explain it from the marketing point of view. You come to an electronics store to pick some random headphones (or anything else). You don't know a thing about headphones, just like 90% of the customers. You see Beats going from 250 to 450 and you say to yourself "Wow, these must be some awesome headphones!". Then you see Sennheiser, Bose, Sony,... with price ranges going from 20 to 600 and there are two things going in your mind. First of all, you are scared to buy the expensive models cause you're afraid to overpay or to be able to buy them for $50 in a year or so. On the other hand, you see the cheap models and you start thinking that the brand isn't as good as you though and the first reaction is that if there are ok models for 30-50 then people don't buy them, so they are trash. The same thing goes for cars, an expensive Citroen won't sell well because of the cheaper models and people's stereotype that the brand is cheap.

    Now I don't know any professional musicians at all and there aren't that much musicians in the world, or to be more precise there aren't a lot of musicians who could afford expensive headphones. However I know dozens of people who own Beats. They don't know a thing about music, they just know that Beats are expensive, good looking and trendy. And that's the only thing that matters for an average Joe. All I can say is that Beats found the golden middle. You can't earn money by selling $10k headphones and you can't earn by selling $30 crap. Today you earn more money by offering a high scale "illusionary luxurious" products, just like Apple and Beats do.

    PS: I own Sennheiser Momentum myself.
    May 11 01:33 PM | 5 Likes Like |Link to Comment
  • Apple + Beats: Cutting Through The Hype And Negativity [View article]
    Sennheiser is a plastic boring €30-50 trash. They offer better specs, but they aren't trendy and aren't popular at all. 5 year old Beats models are never discounted. They are being sold for €250-450 and people buy them like if there was no tomorrow. Transforming Sennheiser into Beats would be impossible even for Apple, but making Beats better (if it's actually necessary cause customers buy them anyway) would be a peace of cake for Apple.
    In my opinion market positioning, marketing, consumer reception and sales growth are way more important than buying unpopular companies like Senheiser, Bose, Koss, Sony or Philips.
    May 11 09:11 AM | 5 Likes Like |Link to Comment
  • Apple + Beats: Cutting Through The Hype And Negativity [View article]
    It's hard to tell how much a tech company worth nowadays. Things shift extremely quickly and that's where you see that inflation is computed really poorly in our economy. With price tags such as $1B for Waze, $1B for Instagram, $4.5B for Snapchat and $19B for WhatsApp book sheets don't have any importance at all.

    Beats has over a billion in revenue and a +60% marketshare. We can easily say that it's a tremendous company with loyal customers and an excellent image, so in my opinion it does worth $3B. Could Apple buy it for less a year ago? Of course! But unfortunately, when people know that you have $150B in cash, any acquisition will have a huge premium. Since 2006 Beats released only one refresh, they never offer any discounts and still their sales grow year after year. Imagine what Beats could become if Apple would start releasing new models once a year during their keynotes. Apple showed us that they have the ability to revolutionize any tech product.

    Beats made of their headphones a lifestyle fashion accessory and even Swiss watch makers try to take profit from that success. Hublot (among others) for instance released limited edition golden headphones with a thousands of dollars price tag. In the same way Apple transformed mp3, phone or tablet markets, Beats transformed the headphones market so for me it's great match.

    What I find incredible is that markets were much more enthusiastic and comprehensive when Facebook purchased WhatsApp - a profitless startup. Besides that, unlike Apple, Facebook doesn't even have $19B to spend!
    May 11 09:01 AM | 16 Likes Like |Link to Comment
  • Apple Is Acquiring A Fad - Not Quality - And That Is Troubling [View article]
    As I see it, Beats have always been unofficial Apple premium headphones. Almost every young person owning an iPhone has Beats speakers. Moreover, Beats are being sold in Apple Stores all over the world. Maybe theses speakers aren't the best (I'm not a sound expert), but they are the most "hype" on the market. iPhone isn't the best phone either, but it is still the trendiest. Most of consumers don't care about having the best product, cause all people care is the image, trends and designs. You seem to forget that the percentage of geeks, tech experts or engineers is incredibly low in our society, so the technical side of products is secondary at most. It doesn't amaze me at all that Apple acquired them, I just don't see why they didn't acquire them years ago for much cheaper.
    May 9 01:02 PM | 7 Likes Like |Link to Comment
  • BlackBerry selling Canadian real estate for $278M [View news story]
    Personally I've never read about estimations above $350m. Everyone seemed to be very conservative (accurate) with prediction going around $275-325m which is already a huge spread in my opinion. I talked to a couple of friends in Canada, who work in the corporate real estate field and they weren't expecting Blackberry to get more than $200m cause the market is very chill at the moment. I suppose that the fact that they were selling a huge lot of 3M sqf played a huge role in the price formation. Predictions such as $400-600m with over 50% spreads don't seem professional at all. It seems like unexperienced people were dropping baseless imaginary figures in their amateur "analyses".
    May 6 08:55 AM | 2 Likes Like |Link to Comment
  • Apple Continues To Bleed Market Share [View article]
    Michael,

    "I don't think the stock split, buyback or dividend increase will prompt more people to buy iPhones."

    Wow, ok that's where you lost me... With such hopeless absurdities I don't see the point of pursuing that discussion with you. Enjoy your shorting and keep compensating your losses by writing your "enlightening" articles. Best wishes!
    May 6 06:41 AM | 1 Like Like |Link to Comment
  • Apple Continues To Bleed Market Share [View article]
    Michael,

    Sure, today Samsung is a strong competitor, no one can deny that. However, you shouldn't forget the fact that they have a lot of weaknesses too. They can't innovate by themselves, they don't own their OS, they offer an inferior quality, they have much lower margins than Apple, but most importantly, they don't have the same fan base and image as Apple. Apple offers a year old refurbished product for a higher price and with the highest margins on the market. No one really cares how much they sell, as long as they earn more than Samsung, don't you agree?
    I was extremely surprised by last quarter results, it was completely unexpected for me, but I took them into account. Apple is all about designs and their legendary marketing. They don't really need to innovate, create better phones or sell more phones than Samsung, cause no matter what they are still winning. Their business works perfectly fine and it's going to work that way for at least 1.5-2 more years. Then we'll see where it goes, but today it's quiet pointless to short them or to predict a disaster. If they were able sell that many 5s', which wasn't appealing at all, imagine how many i6's they are going to sell. Your arguments were tangible 2 quarters ago, but now, with the shares split, a wider buyback program and a new iPhone announcement by June/September, this stock is a huge buy and hold until at least 2015.
    May 4 02:01 PM | 4 Likes Like |Link to Comment
  • Apple Continues To Bleed Market Share [View article]
    There is simply no conclusive evidence that Apple is in danger, or would be during the next two years.

    First of all, Apple's users are very keen to buy pricier products. Unlike other phone makers, Apple can allow itself to release even more expensive models and by doing so, Apple might even increase its sales and earn way more from iPhones than it does today. I assume that Apple's strategy for 2014-2015 is going to be a release of one or maybe two luxurious iPhones with bigger curved screens and a sapphire glass (like on luxurious Swiss watches) among other new features. Unlike other companies, they are about to expand their models range towards the top, while others are retrograding their models in order to reduce prices and sell more with microscopic 1-3% net margins. And that's why Apple is about to make a new home run - they are consolidating their position as the only true high end phone maker on the market and like during any financial crisis, that's what consumers want today. There are no alternatives with iPhones, you can only buy the high-end iPhone, whereas Samsung is everywhere and you don't even know if a person holds a $100 or a $700 phone, cause they all look the same! There are dozens of countries where people take bank loans and spare every penny just to buy an iPhone, so the more luxurious it's going to get, the more desirable it's going to be, as long as it doesn't cross a €900 price range.

    On the other hand, if this strategy fails, which is very unlikely judging on the last quarter, they will still have 2 more options. They can reduce prices on the existing high end models, or they will be able to do the same as everyone does today, to shrink their margins and release low-end iPhones. I'd like to remind you that just a year after Apple released iPods mini, they counted for over 70% of the mp3 market, while cheap Chinese and Vietnamese mp3 brands were unsuccessfully flooding Western markets. Thanks to the present iPhone's ora these cheap iPhone versions are going to get sold like hot cakes in the developing countries.

    With $130B in cash, Apple can use absolutely any option it wants and it has ways of making money people aren't even aware of. They have a huge client base, an excellent brand perception, a tremendous technology and highly competent experts. Today they are truly the only ones who have the means to their ambitions. Moreover, from the technical point of view, there is absolutely no reason to sell APPL today, especially in the wake of the shares split. In the $80-90 range, millions of investors are going to hop in the APPL train and the stock is about to make a huge leap forward. You must really hate APPL as well as your wallet to have the guts to short AAPL today.
    May 4 08:17 AM | 11 Likes Like |Link to Comment
  • Apple wins $120M from jury in Samsung dispute, far short of $2B it sought [View news story]
    "The amount is less than 10% of the amount Apple requested, and probably doesn’t surpass by too much the amount Apple spent litigating this case"

    It might not surpass Apple's compensation, however, even though Apple might haven't earned any money, Samsung had to pay double - his defense and the compensation. And any amount of cash that Samsung loses, is beneficial for Apple.
    May 3 06:51 AM | 6 Likes Like |Link to Comment
  • The Party Is Over For Chen, BlackBerry [View article]
    "You won't sink another 1.25 billion to the co unless you know you can recoup the money and more."

    I assume that Fairfax wouldn't lend $1.25B to BBRY if they knew that it would go bankrupt. They have a much more exhaustive access to BBRY books than we do. Either they saw that the company can be sold for much more than its value + the debt, either they forecast a huge recovery. I doubt that a hedge fund would get as emotional as longs here and would just gift them $1.25B, knowing that they lost much more cash on BBRY than all SA users combined. But keep in mind that if BBRY actually goes bankrupt, Fairfax will get the best pieces.
    Apr 27 09:18 AM | 4 Likes Like |Link to Comment
  • The Real Premium Smartphones Are Not iPhones [View article]
    Michael Blair,

    I see your point, but the truth is that 99.9999% of the customers don't care about having the most luxurious phone, in the same way as most of the customers don't care about having the most performant phone. iPhones were sold in limited editions too. Some golden iPhones with precious gems were sold up to $1M on billionaire expos. And so? These phones weren't even made by Apple. It were basic iPhones transformed into luxurious items by artisanal European jewelers. The real question is how many of the brands mentioned above have Apple's profits? None of them gets close to Apple. Luxury market is way too marginal and volatile to offer billion dollar profits. Apple offers an affordable high-end phone, with a gorgeous design and good specifications. The fact that you think that iPhone is luxurious is simply Apple's marketing department strategy and as you compare a $200 iPhone to a $7000 Vertu, I can easily say that they do a tremendous job!
    Apr 23 01:23 PM | Likes Like |Link to Comment
  • Google to start sales of Glass device next week [View news story]
    Yeah, but that "limited number" of glasses will be sold in a matter of minutes anyway... No other company offers anything like that, so they can set any price they want, there will always be people to buy these gadgets.
    Apr 11 09:17 AM | 1 Like Like |Link to Comment
  • Samsung unveils Galaxy S5. U.S. launch set for April. [View news story]
    Hardly racism, just the ugly truth. Sorry, can't hide history and facts behind the racist card when it comes to business.
    Feb 24 06:01 PM | 8 Likes Like |Link to Comment
  • Apple beats estimates, but guidance disappoints [View news story]
    Yes... The guidance... Right. Strong and steady growth, higher margins, higher revenue, higher sales, but what about "THE" guidance? The street shows us that we should bet on magician's hats - risky, "non-profit" startup companies with a highly uncertain future, like Twitter, FB, Tesla, etc instead of on solid money making machines like Apple. After all it's way more rational to invest in volatile trends and bubbles rather than in real cash.
    Jan 27 04:46 PM | 15 Likes Like |Link to Comment
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