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JG2000

JG2000
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  • Apple Can Unlock 68% More Value By Emulating Google In This Way [View article]
    Interesting discussion. One thing rarely discussed is what the motivation and goals inside Apple are...to the extent they retain the Steve Jobs imprint. I think Jobs wanted to create great perfection-seeking products that changed the world...but the reward for doing so (e.g. money/stock performance) was more as a report card and and means to further create. The financial reward was a means to the end...not the end goal itself.

    In fairness few successful companies think only about the rewards...they all have a level of passion about what they are doing...it's just a matter of degree. The Jobs vision was just more extreme on the perfectionist creation side. It shows in the actual products. I presume much of this culture remains at Apple and is perpetuated. Given this fact [if you agree] we can ask if this is good for Apple investors.

    I would argue that as long as Apple is creating great stuff and expanding (even slowly) then this paradigm can work well for investors. The great stuff tends to create great rewards and it's a feedback loop. If a point is reached where things stall due to market saturation, lack of creativity, etc, then this approach can start to work against you because less emphasis is spent on financial issues or managing market perception. I don't know when [or even if] they will hit stall speed but I don't see it in the next year. Given that, I think patience here will be rewarded.
    Jan 2, 2014. 08:20 PM | Likes Like |Link to Comment
  • Apple Screwed Up Big Time [View article]
    I recall reading that Apple got locked into these displays because they needed to pick a technology to meet design, contract & volume criteria. In retrospect it may not have been the best choice but the quality/reliability is still excellent.

    If this is really a legitimate concern we should expect Apple to upgrade the displays in future iPads. In the hardware arms race you always have competitors leap frogging (such as 64-bit) and it will probably be Apple's turn soon on the displays. If Apple feels the displays are inferior they may not admit it publicly but I believe they would be extremely motivated to rectify (I don't believe they just decided to "cheap out"). Clearly they have the dollars to invest if needed and they can charge top dollar for their products...therefore this does not concern me much as an ongoing problem but is worth monitoring. I don't see it as enough of an issue to affect an investment thesis at this time,
    Jan 1, 2014. 07:17 AM | 2 Likes Like |Link to Comment
  • Buy Apple: I Maintain My High Price Target, And Here's Why [View article]
    I suppose BMW is losing market share every time a big shipment of Hyundai's are sold but it doesn't seem to affect their customers or profits. For Apple, profit-share trumps market-share.

    Market share isn't completely immaterial, especially as it relates to premium-segment competitors but lets discuss when the FQ1 numbers are released. The bearish market share discussion usually focuses on the period before the first full release quarter (for new iPhones) when share is at a low point. I do think Apple has wasted some market share with slow movement to a larger screen phone but that should get fixed with iPhone 6 (or if not, I will turn less bullish).
    Dec 31, 2013. 08:46 AM | Likes Like |Link to Comment
  • Wedge Partners offers cautious China Mobile iPhone estimates [View news story]
    The rubber will really meet the road when CHL announces it's iPhone subsidy/pricing. Meanwhile, though, I would say that anyone not presuming an impactful CHL upside to AAPL would carry an umbrella hiking the Sahara desert.
    Dec 31, 2013. 04:08 AM | 1 Like Like |Link to Comment
  • 2014 May Be The Year To Short Apple [View article]
    As a very short term January play we are left pondering which of these 2 forces are greater:
    a) Anticipation of blowout FQ1 results and decent FQ2 forecast.
    b) Typical "Sell the good news" effect and significant gains off the recent bottom.

    My take on this time window (notwithstanding my more bullish outlook on 2014 as a whole due to larger iPhone 6 and greater China penetration, buybacks, etc) is that these forces could be somewhat in equilibrium and that makes short term decisions tenuous. The stock will probably be quite sensitive to January news flow pre earnings (from Apple or CHL or competition or overall market). The stock could also take on a momentum trade (up or down)...the herd is easily spooked at this time of year.
    Dec 30, 2013. 10:42 PM | Likes Like |Link to Comment
  • 2014 May Be The Year To Short Apple [View article]
    Terminology correction: A $500 'put' is "in the money" when the stock price drops below $500. You can make money on the time value (risk premium) but until it is "in the money" its intrinsic value is zero.
    Dec 30, 2013. 02:59 PM | 2 Likes Like |Link to Comment
  • 2014 May Be The Year To Short Apple [View article]
    I looked up the Digital Trends review of the iPhone as mentioned in this article. Under "User Reviews" there were only 7 reviews TOTAL with an aggregate 2 stars as mentioned by this author. Several looked like trolls. While this was not the totality of the articles argument....presenting patently absurd supporting facts undermines the case.
    Dec 30, 2013. 07:24 AM | 16 Likes Like |Link to Comment
  • Apps Won't Save Apple [View article]
    There is a big difference between a larger screen phone and a cheaper phone with a plastic housing. Look at the iPhone users that have jumped ship just because of the screen size (and I am not talking about myself...my iPhone is fine for me). It's true that Apple should not try to please everyone but the iPad/mini scenario illustrates that it makes sense to support multiple sizes without stepping outside Apple's philosophical framework.
    Dec 29, 2013. 05:34 PM | Likes Like |Link to Comment
  • Apps Won't Save Apple [View article]
    Your logic is sound but I presume you are not arguing a big segment of the market should be abdicated by Apple just because it doesn't match your [or my] personal preference. Apple should [and probably will] produce 2 phone sizes similar to the iPad approach...some people prioritize portability and some prioritize legibility (especially when the phone is their main or only computer).
    Dec 29, 2013. 04:48 AM | 2 Likes Like |Link to Comment
  • Apps Won't Save Apple [View article]
    I agree with the screen size causing significant market share loss but probably some of that loss is either permanent or hard to win back (i.e. although, IMO, IOS has a better and stickier ecosystem ...Android still has some ecosystem draw and retention too). I do think the market share win back will surprise to the upside though.
    Dec 28, 2013. 07:21 PM | 2 Likes Like |Link to Comment
  • What Matters About Apple [View article]
    As I understand it, after the Microsoft acquisition, Nokia is essentially a "technology and IP licensing" company. They are presumably out of the manufacturing business unless they were to start something from scratch. I don't know enough about this to have a bullish or bearish leaning...just curious what you see as the major driver(s) for NOK going forward?
    Dec 24, 2013. 08:03 PM | Likes Like |Link to Comment
  • 9to5 Mac: Apple likely bought mapping, online note-taking startups [View news story]
    It may not be a binary issue. You have revenue, earnings, margins and sales volumes (iPhones, iPads, etc). It's possible, for example, for a strong beat on revenue and sales but earnings & margins are only on the high end. Maybe they wouldn't raise guidance in that scenario even though results would be very good.

    It makes sense that they wait until the Christmas numbers are in so we could see a raise. However there is a always some kind of trap...if they do raise to avoid the unwanted surprise factor Humble Eagles discusses...then the market becomes more addicted to the 'raise' and any lack of a raise in future quarters would spark some selling. I would still agree that giving the raise is best...just pointing out that in regards to guidance no approach is perfect.

    Having said all this...I expect FQ1 results and FQ2 guidance to be excellent.
    Dec 23, 2013. 07:16 PM | Likes Like |Link to Comment
  • Apple strikes iPhone deal with China Mobile, sales start on Jan. 17 [View news story]
    Partially priced in is NOT the same as fully priced in. I think many large funds are still sitting on the fence about reentering AAPL; this could be [and should be] an important catalyst.
    Dec 23, 2013. 10:02 AM | Likes Like |Link to Comment
  • Smartphone Subsidies May End; Apple Might Suffer Withdrawal Symptoms [View article]
    Exactly. Removing the conventional subsidy encourages consumers to more closely consider the cost/benefit of the phone itself and the superior resale value and quality (reliability, longevity) of the iPhone makes it stand out.
    Dec 19, 2013. 09:47 AM | 2 Likes Like |Link to Comment
  • Smartphone Subsidies May End; Apple Might Suffer Withdrawal Symptoms [View article]
    There isn't that much difference in pricing between iPhones and similar bracket competitors. For example on T-Mobile the "$0 up front" pricing is an extra 2 dollars a month for the iPhone 5s over the Galaxy S4 ($48 total spread over 2 years).

    Due to the various financing options and the fact that users expect reduced data costs with the unsubsidized phones...this tends to reduce or eliminate the "no subsidy" threat.

    An argument can be made that the removal of subsidies increases the replacement cycle times since it makes the cost of the phone more apparent and because the monthly spend is reduced once the phone is paid for. However, this would apply to all cellphones and the carriers are motivated to counter this trend since the newer phones tend to consume more sellable data.

    Overall I don't see evidence that an iPhone subsidy issue exists or is likely to exist in the near future -- however, it does deserve ongoing scrutiny, especially as it applies to the overall mobile marketplace. A unique Apple problem is not apparent.
    Dec 19, 2013. 09:08 AM | 4 Likes Like |Link to Comment
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