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bailinnumberguy

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  • Apple reports earnings on January 27 [View news story]
    There's no reason to suspect anything. He does it to gauge whether stock prices are generally over or undervalued. He looks for a percentage range of reasonableness comparing Cap to GDP. Cap > GDP is a red flag and the greater the gap, the bigger concern. It's a very common methodology not unique to Buffett.

    The amateurish nature of the commenters here usually comes to light when you mention something that is very commonly done by professionals and get bashed as if you're making something up as you go along.
    Jan 6, 2015. 11:43 AM | Likes Like |Link to Comment
  • Apple reports earnings on January 27 [View news story]
    Warren Buffett looks at market cap relative to GDP to see if the market is overvalued. I didn't just make this up walking down the street one day.
    Jan 6, 2015. 10:08 AM | Likes Like |Link to Comment
  • Apple reports earnings on January 27 [View news story]
    Technically AAPL is on the brink. It's below the 50 day and flirting w/ the 100 day. If the 100 day doesn't hold and later on Q1 earnings plus guidance disappoints, look out below. A huge quarter has already been built into the price. I think it's more likely that AAPL moves down $20 than up by that same amount from here.

    Any weakness will be exploited by the bears without mercy and there's a lot of air underneath the price. Once AAPL has approached and exceeded the highest market cap in history it has sold off.

    Anyone projecting AAPL to reach a $1T cap, forget it. The entire GDP of the United States in 2014 was $17.4T. Apple's going to be worth 6% of the entire United States economy? Get serious.
    Jan 5, 2015. 10:22 PM | 1 Like Like |Link to Comment
  • Poll: Only 5.4% of U.S. iPhone owners "very likely" to buy Apple Watch [View news story]
    Technically and fundamentally AAPL is on the verge of becoming fried liver. All of the energy is to the downside and as I write this the 100 day has been breeched.

    The momentum traders have moved from the long to the short side. The stock took a roller coaster ride up beginning on Black Friday 2011 and culminating in September 2012. From there it headed due south and gave back everything it had made on the Black Friday run. Darth Vader (Carl Icahn) arrived and gave it a boost. That ride up is now likely over and the trip back down is underway. Stock buybacks, dividends, rational acquisitions have been effective levers in distorting EPS upwards, attracting other types of investors and broadening the company's footprint, but....

    You can't escape the obvious: Growth on the top line and the bottom line have inevitably decelerated to the point that you can't call this a growth company any longer. Also, it pays a pedestrian dividend despite a high degree of volatility. Who's excited by that?

    Multiples on price have expanded based on aggressive growth targets. If the company can't grow by double digits, look out below.

    Time to look for opportunities on the ride down to about $80 or so per share. It'll almost certainly touch that level in the next 12 months.
    Jan 5, 2015. 03:02 PM | Likes Like |Link to Comment
  • Why An 'iPhone 6s Mini' Makes Sense For Apple [View article]
    I hope that Apple does not come out w/ a smaller iPhone 6. The iPhone 6 and 6 Plus clearly presented a philosophy that the company is moving to the larger screens. If the main feature the customer wants is the smaller size, they can purchase an older version of the phone. As an AAPL long I like a clear direction. Going to the larger screen is a clear direction. Saying that behind door # 1 we have the bigger phone and behind door # 2 you can get a smaller phone is not a clear direction. Companies get into trouble when they try to be all things to all people.

    Also, why is everyone surprised that the iPad is declining in sales? Apple's larger phones are certainly cannibalizing the iPad market. If you buy the iPhone 6 Plus, why would you want an iPad mini or even an iPad for that matter? In the past I've owned an iPhone, an iPad, a MacBook, an iMac, a nano and a few other Apple toys at the same time. If I buy the larger phone now, I'll abstain from the obligatory iPad purchase.
    Jan 5, 2015. 02:13 PM | Likes Like |Link to Comment
  • Poll: Only 5.4% of U.S. iPhone owners "very likely" to buy Apple Watch [View news story]
    The proof will be in the pudding. Apple completely revolutionized consumer behavior beginning with the iPod continuing to the iPhone and the iPad. Most people I've spoken to don't have a lot of interest in the watch. Of course you could've said the same before the iPod, iPhone and iPad appeared. First year sales should be modest until the price comes down. From there it's anyone's guess.

    On a completely unrelated topic, why do so many people speak of the demise of the iPod? Are they nuts? Every sale of an iPhone, iPad, MacBook Pro, Air, iMac is a partial sale of an iPod. Of the apps that I, and everyone that I know, uses with regularity it's iTunes (in effect the iPod) by miles.
    Jan 3, 2015. 03:28 PM | Likes Like |Link to Comment
  • 2015 Will Be Apple's Year: Raising Price Target To $174 [View article]
    I have significant holdings in AAPL and hope that your price target comes to pass this year, but c'mon. That's more than 55% up from current levels and will put AAPL's market cap so much higher than any company has ever achieved that it's not reality. Could it happen one day? Sure. Will it happen this year? Highly unlikely. Some of the comments above are just cheerleading. I think Apple is the best company in the world, but stock prices eventually correlate to earnings and projected earnings and if you think that the company's earnings are going to accelerate by 50% you probably need to take a few finance and accounting classes.

    That being said, 20 to 25% increase in price is a more realistic best-case projection for the coming year. Again, I'd love to be wrong to the upside.
    Dec 31, 2014. 01:52 PM | 4 Likes Like |Link to Comment
  • Apple Should Post An Astounding Q1, But It Might Be A Hard Act To Follow [View article]
    The author ends his piece by pointing out that he holds PUTS in the stock. If he'd put (no pun intended) that at the beginning everyone could've had a laugh and chosen to not bother reading the article. You can hold protective puts as your downside protection and be very bullish on the stock. Not a bad strategy on a very volatile stock. I wonder for how long this guy has been buying puts and how much he's sunk into such dubious speculations.
    Dec 29, 2014. 11:42 PM | Likes Like |Link to Comment
  • Apple Short Interest Plunges Again [View article]
    Short interest is a double edge sword. It's emboldening to longs when the short interest is low, but shorts are the most reliable buyers when the stock starts to head north.
    Dec 29, 2014. 12:31 PM | 1 Like Like |Link to Comment
  • Setting Up Apple's Amazing 2015 [View article]
    I'm always long AAPL, but I just don't see masses of people spending $500 on a watch. The iPhone and iPad were major game changers. An Apple TV has the potential to be one if it ever arrives. A watch? It's just another app container w/ an itsy-bitsy screen. I hope I'm wrong, but my circle of friends and contacts don't have a lot of interest in acquiring this device at that price point.
    Dec 26, 2014. 01:47 PM | 3 Likes Like |Link to Comment
  • Apple Analysis: Free Versus Levered Free Cash Flow [View article]
    I'd argue that every stock is always fairly valued all the time. The price always floats to the level where a buyer and seller are matched. Whether it's overvalued, fair valued or undervalued is irrelevant so long as sellers and buyers meet at a level above or below where you want it to be. You can crunch numbers until your head explodes but it's rare to find a price that correlates cleanly to whatever analysis you do.
    Dec 21, 2014. 02:43 PM | 1 Like Like |Link to Comment
  • Apple Analysis: Free Versus Levered Free Cash Flow [View article]
    This is a good analysis and discussion of Free Cash Flows and Levered Free Cash Flows. It doesn't tell the whole story though with respect to AAPL's 'declining' earnings. I found it a bit curious that you jumped from 2012 to 2014, skipping 2013. Here's AAPL's Net Income by Year since 2005:
    2005 - $1.33B
    2006 - $1.99B
    2007 - $3.5B
    2008 - $6.12B
    2009 - $8.24B
    2010 - $14.01B
    2011 - $25.92B
    2012 - $41.73B
    2013 - $37.04B
    2014 - $39.51B

    Obviously AAPL wasn't going to be able to sustain the earnings growth forever. The question is why did earnings decline from 2012 to 2013 and from 2012 to 2014.

    Heres why: R&D and D&A. Both have increased substantially. Research is up by $2.6B and Depreciation (and Amortization) is up by $4.7B. That indicates much greater investment in research and physical plant.

    Clearly AAPL isn't the growth company it once was, but the 'decline' in Net Income needs to be looked at a little bit more closely.
    Dec 21, 2014. 01:49 PM | 12 Likes Like |Link to Comment
  • Apple: Does The Party End In 2015? [View article]
    No one ever talks about the real power of AAPL. Follow the money. It's the company's cash position that makes it impregnable. The company has a ridiculous amount of liquid assets, over $150 billion. They can acquire any company that they want with little fuss. They can buy limitless advertising, swallow up smaller companies, do whatever they want with all that liquidity. Money makes the world go round and Apple is probably the greatest money machine there's ever been.
    Dec 18, 2014. 03:51 PM | 2 Likes Like |Link to Comment
  • Apple: Why The Current Pullback Is Good [View article]
    Days like the last 2 are why you short AAPL at your own risk. You could see the whip-saws yesterday as prices were flying all over the place as shorts rushed to cover. A few years back I tried to time the highs in AAPL and short it. Not a good strategy for the most traded stock in the world. When the short squeezes come you get killed.
    Dec 18, 2014. 02:26 PM | 1 Like Like |Link to Comment
  • Apple: A Pullback To Strongly Consider [View article]
    I'm an AAPL bull but using an annual dividend yield that increases from 1.58% to 1.71% to recommend a buy on a stock that can go up or down 40 or 50% in a year is perhaps not the most compelling argument.
    Dec 15, 2014. 07:34 PM | Likes Like |Link to Comment
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