Last chance to buy Apple below $600 maybe ever right now. If you don't the smart money will. Fact is, there was never any fundamental reason for the 100 drop in the first place. The real earnings power merits more like $900 a share. But the Street kept misreading, misunderstandinmg, fearing the worst and blowing molemills into mountains.
The fact is, Apple is now the first and only major company that pre-sells everything it makes before it makes it at high profit margin prices, and every new customer becomes a customer usually for life, and buys all sort of other things inside the wonderful Apple ecosphere.
People tout Samsung, but they are just a fancy hardware maker, and a copycat of Apple. People tout Google and Amazon, but they make no profit off their Pads and Google gives away Android to low end phone makers. Windows Phones, Tablets and Windows 8 are all duds. Blackberry and HP have been decimated by Apple. Intel is in trouble unless it gets a big Apple deal. And Apple has more free cash than all of them put together.
One more thing. Apple is the only one who has effectively cut out the retail middleman. Nowadays most iPhones are pre-sold directly on Apple.com or sold in Apple stores. Apple doesn't need retailers. And Sam,sung can make fun of Apple launch lines all they want, but who ever lined up to buy a Samsung anything? Not a single person on earth. And for good reason. They are fine products, but Apple is special and will be for many years to come. No real competition on the horizon ecept at the low margin end, which Apple is not really interested in anyway. Mercedes need not compete with Kia.
Apple Is Dirt Cheap And Should Be Bought [View article]
Every once in awhile the Market makes a terrible error. These can range from pricing Enron at $100, to once pricing AAPL at $10. Recently, the biggest two errors the Market has made are with AAPL, both to the upside $1100+ projections, and to the downside (s days ago for instance). So we are only 3% from the bottom of the worst undervaluation of a major company stock I have seen in a long time.
Error #1 was that Apple is out of ideas and can only go down from here, a no growth company. FALSE! But you see now the stock is priced for zero growth and zero new products. Error #2 is to call the last two quarters "misses" when whjile less than stellar in terms of growth, they met estimates last Q, grew sales in the most important categories and margins dipped only slightly. And even that slower growth was explainable as demand outstripped supply for about a month there. So while GOOG and IBM both diid about ther same as AAPL in terms of barely meeting last Q, AAPL got taken to thje woodshed and GOOG and IBM had big rallies even though their PE's are both much higher. and AAPl has enough cash to buy them both.
Error #3 - to forget Apple has more cash than God and its addition of free cash exceeds its earnings growth (not sure why, ask an accountant). They added 27 billion in cash the last two Q's when they supposedly "missed" and got taken down 35%. Just thnk of how many option s they have with 137 billion cash.
Error #4 - no new ideas,. How the F would anyone know that? Apple is very secretive abolut its next big things for good reason, because companies like Samsung are expert thieves and can steal and put out products quickly. (see the Galaxy phones which are not the "next big thing" they aree copycat products as proven in court.
Apple's next targhet is presumeable TV (next generation home entertianment) and boy could their cash be important there. Yes, buying Netflicks, Time-Warner Cable, even Time Warner itself, they have enough to buy anything in Hollywood they want. So stay tuned. If Apple wants it, they can have it and it is bound to be brilliant. (notice BTW Samsung came out with "smart TV" as soon as the Apple TV rumors began - copycats always).
Error #5 - Competition is killing Apple. Like who? Yes Samdung sells more units but makes 70% less profit on each and cheap models where Apple does not even compete. Apple will never be in the business of quantity, only quality. So for everyone making $40,000 or more in the world, Apple products are the best choice. Also, in Pads, Apple really has no serious competition. What, a Kindle Fire? Yes there are plenty of products to choose from, b ut if you want the best, Apple is again the choice.
Error #6 - Apple is stingy. Well so far partly true, but I expect the pressure is on the board to keep increasing that dividend starting probably after the board meeting on the 27th. And if they can offer as good or better than MSFT and INTC, a no-brainer which to own as a dividend and growth stock.
Anyway, you have the buying op of a lifetime now people, for the long term not as a trade. Aple is definitely worth $700 a share even without stellar growth, hell its brand name and copyrights alone plus cash are worth that much. Any extra growth now is justr gravy and no growth at all is priced in anymore. None. 10 PE people for the best company on earth. Grab it while you can under $500. A no-brainer now that the big overshoot freefall appears to be history. And if you're shorting AAPL now, say goodbye to your money.
Hey idiot, stop watching Fox News. Obama is not a socialist. Her merely wants the rich to pay what they did in the 90's which was a low tax rate but gave us balanced budgets. and if you want a nation without health care insurance and retirement safety nets, move to Mali or something. even third world countries have safety nets of some sort. And it is not wrong or un-American, it's right and common sense. Why don't you concentrate on makmiong guys like Romney pay their fair share of taxes instead of hidikng it all in offshore tax havens and cheating every one of us. That would make sense. This talk about socialist makes none at all. Canada works just fine and they have five times as much socialism as we do. They have rich people too. They just don't wage wars on credit cards and have fantastic giveaways to the rich and major corporations, letting them evade their civic responsibilities. Paying as we go means going after the tax cheats and pikers. It does not mean letting our country crumble and slashing help to the sick and needy. Jesus Christ would completely agree by the way. He was pro poor people and sick people, and love thy neighbor. Some things Republicans have conveniently forgotten as they call themselves a pro christian party.
Market continues to be 'stupid" when it comes to AAPL. Only up 6 today when it is the biggest no-brainer likely 50% gainer over the coming year? Just amazing.
The good news is that the dishonest or deluded naysayers and worry warts about Apple have finally shut up, except for a few suspect Koreans. and the NY Times article about samdung maybe challenging Apple as the "cool" thing seems like a contrarian indicator. Samsung may be a fine product and cheaper but it's also a clone of the iPhone and has even lost in court over copyright infringement. The jury was 100% unanimous and took about two minutes to deliberate. The jury is in, Samdung is guilty and yet is also willing to spend all its money on aggressive ad campaigns designed to "appear" to be the hot new thing when they obviously are just following apple's lead (legally or not).
I see the other supposed "Apple killer" Google has rallied lately despite doing no better than Apple at meeting expectations, and being more than twice as expensive. and its own CEO is echoing that sentiment by cashing out at the top, smart guy. In fact smart anyone who trades in their inflated GOOG, Amazon and IBm shares now for AAPL which for some bizarre reason has been taken down 250 points and is now selling below book value and below even the worst pessimist's projected value.
Today's APPL price counts liquid hard assets and copyright value and nothing more. and it assumes Apple will not grow at all but instead will shrink. Which is totally divorced from reality to the tune of about a 300 billion dollar price differential. Which means you basically have a stock here hich should and probably will rise 50% this year, maybe even more.
So why are only a few people buying? and why are there any shares for sale at this ridiculously low price? Must be that the Market is still "stupid" about Apple. Stupid and short-sighted and still believing the BS convention wisdom of a few weeks ago, that Apple is on the decline, when there is no evidence to suggest anything like that, and it is very likely to happen for many years to come. In fact, I believe Apple can double in size and sales in just the next three years. I write this from South Ameica where Apple has just begun to penetrate. Yet everyone in south america seems to have a cell phone. So as incomes rise on this continent so will Apple sales. and the growth possibilities are truly astounding.
Apple: Answering 5 Important Questions [View article]
AAPL is a screaming buy right now and has been for weeks. My own opinion of the last 5 month sell-off was that is was not based on anything substantive, just a strange herd-like blowback fueled by false rumors, overblown worries, Apple's terrified competitors like Samdung fighting with everything they have, one rare but relatively minor screwupo oin MapAps, and basically a hangover from the Apple party which drove the stock to $705.
But once dropped below about 590 it became more and more and mroe ridiculously oversold. From 590 down to 440, this was a case of lemmings chasing lemmings and totally ignoring fundamentals. Technical chartists and short sellers ruled the day scaring off value buyers. The rumor that Apple's grown and high margin days are behind it created a paralysis amongst buyers. everyone started waiting for the bottom or a big rally ioff january earnings.
january earnings were actually good, that is a little disappointing but any other company would have killed for them. By the 60 pooint drop afterwards you would have thoght Apple missed, but they didnt. They lke Google barely met. Butg Google rallies and Apple dived. Though Apple made four times as much profit as Google, sells at half the PE of Google and added 17 billion in free cash. (see now Google's CEO is cashing out his stock, evidence he considers it overbought. But is he buying AAPL? Well, he should)
Their margins went down a bit because they were adding new customers with last year's iPhones which for once were selling at a discount through phone carriers. Mini iPad was a lesser profit margin item but added millions of new IOS customers who will proobably become captive to IOS for a lifetime. Margins will go down again if and when the massive China mobile deal is done. But in exchange, Apple will grab 50 million new Chinese customers, the most affluent class there.
AAPL is now selling below book value, at less than half its real value and subtracting cash for about the value of its copyrights alone. Plus this iWatch story proves they are not only innovating, they are capabkle of opening up entire new markets which did not even exist previously. Their Apple TV concept may do the same as it could totally change the home entertainment concept and make Tv remotes and all othe annoying elements and limitations of current TV a thing of the past, again for affluent customers.
Nobody buys an Apple because it's cheap. They buy it because is the best (by far) and because it is the most useful, the best looking, a reak status symbol and because once a customer enters the IOS eco-system, he/she never leaves. brand loyalty is one of those intangibles worth hundreds of billions which is not at all priced into the stock these days. So don't worry about what the nay-sayers say. Samdung is not the "new thing". And their stock just ran up 20% anyway, as did Google. So get in cheap while you can. Because in case you hadn't noticed, for the past three sessions AAPL has been on fire, and we have only just begun to retrace the 200+ points back to even begin to approach true value. Plus we'll get a better dividend now. So what's not to like?
Don't worry, you won't be underwater for long. Two major factors will shoot Apple back past 650 very soon, then 700 and 750 and 800, maybe stopping around 850.
First to start, once the damn election is over the Street will stop worrying about that and a fiscal cliff avoidance deal will be reached. Just a matter of whether the rich may a little more of not, or if the GOP sticks it to the middleclass and poor instead. Either way there will be a deal and the market aw a whole will rally.
After that, Apple will begin to leak out the numbers going into christmas and the estimates will rise and rise and rise. The January earnings report will be the biggest in corporate history, and March should be equally collosal. Then Apple will tell us what is will do with its (by then) 140 billion mountain of cash. Here are a few possibilities:
1) Spend 20 billion to buy out Hollywood's content deals, including Time Warner Cable if they want it, and launch Apple TV with more content than anyone on earth.
2) Buy up bandwidth via towers and own the 4G and 5G worlds.
3) Buy a search engine like Yahoo (the whole company maybe) and jettison Google.
4) Up the dividend to 3% plus more stock buybacks.
5) Expand Apple stores and cut out retail middlemen completely.
6) Buy up whatever supply chain plants and foundries they need to up their output potential in very dependable ways.
And they can do all six and still have plenty of cash left. So ask yourself, what other stock in the world sells for 10-15 PE and has anything remotely as amazing going for it? Zero.
Apple's Worst Day In Nearly 4 Years [View article]
I need to vent. I am heavily on marin on Apple and have 100% confidence in the company and its gangbustres profits (which everyoine will see soon). But the stock is the most undervalued, disrespected and manipulated I have ever seen in the past three months. Today's drop made almost zero sense. I caled my broker and he told me they have no intention of raising margin standards on Apple especially. He agreed it was time to buy more. Which I did. Now, can the nonsense pleae be over? Apple is the cheapest major stock in the world now and has the best profits and market dominance of any company on earth in perhaps the best possib le sector. Why anyone would be shorting it or trying to manipulate it down is beyond me. But I sure as hell am not taking the bait and selling. In fact it is very likely that today's drop will be erased in the next two sessions, This stock deserves to be well over $800 and believe it or not it may just get there, very soon in fact. The pendulum is about to swing back and hopefully all the negative nonsense is over and done with. It had no credibility or substantive basis in the first place.
Apple Is Misunderstood By Both Analysts And The Media [View article]
Ironically, human nature seems to be to attack the #1 best champion for minor flaws or inaccurate assumptions and bring the hero down. We see this in show business, sports, politics, etc. And with Apple we also see it on Wall Street.
Apple is now the cheapest major stock in the world versus real earnings and value, and largely recession proof, and yet is on the verge of the two biggest quarters in world history and growing handily in all sorts of new places and ways. Even last quarter when it supposedly "missed" was a great quarter. They sold 27 million iPhones before the big refresh. Wow. And the only reason their profits weren't quite as high is that huge rollouts like these require great cash expenditures and now that this money has been spent, Apple has become like a gigantic money machine where every unit is pre-cold before it is made online without middlemen taking commissions and customers are willing to wait because the product is so good and so special.
Apple was also taken down 100 points for really bogus reasons which only make sense to a technical chartist. Nothing at all to do with fundamentals or reality. The China riots and Map Aps problems were short-lived and minimal. The supply chain is humming but can only be a problem if customers stop waiting and buy another brand, which they are not doing.
Plus, did you notice that Apple added 10 billion in additional cash to its reserves in one quarter, and in every quarter? Now with 120 billion? Some analysts have seen that as a major problem? Problem? That is the best problem in the world, along with pre-selling everything you make before you even make it at top price and top profit margin. These are Apple's problems. Too much money too many eager afffluent customers. Great problems to have.
I am glad the markets are closed because this insanity of poo-pooing Apple needs to pass like an illness. And it will. In fact soon I expect the same talking heads who have been poo-pooing Apple will be asking when it hits 1000 again? So, as investors, we need to do the sensible thing. BUY when it hits these lows and sell only when it hits great highs, and it hasn't yet hit those highs. 700 was actually still a modest price as it was only at a 14 PE with 30% growth. Cheap stock, fantastic company, huge growth and success almost a certaionty for years to come. And as for the comeptition, except for Samsung phones, they really don't have any. At least not in the $329 and up range.
Prepare Now For The Looming Fiscal Cliff [View article]
The fiscal cliff could actually be a huge bullish event. I have heard that even Tea Party fanatics who want to bring down the government are afraid to risk calamity again. They may be crazy but they also want to get re-elected, and their masters the Koch Brothers, Chamber of Commerce, Exxon, Vegas casino owners, defence contractors and others do not want an economic collapse, after all greed and profit is their reason for being. Same with the European collapse fears. They force the politicians to act.
In the US, the rightwing strategy has been to do everything to hurt the economy so that Obama has a bad record to run on. But the election is only a few months away and the game is almost up. Obama will likely win and congress may even change hands. So instead of committing mas suicide the rightwing congress will at the very least try to be reasonable enough to kick the can down the road, or come to a compromise. Or, if Romney wins, watch the word "deficits" disappears from the rightwing lingo and for them to start spending big-time again. Lots of corporate welfare and tax cuts for the rich. For the country, it would be a lot better fro DEms to win, but either way, whoever is in charge will have no choice but to settle this fiscal cliff issue so as not to cut their favorite programs or raise taxes and be blamed for that next election.
At this ultra low price, AAPL is now the most undervalued major company we have seen since the pit of the 2008 panic sell off. 195 billion in liquid assets? My God, that means the STreet is now valuing the entire IOS system, the entire hardward division,, their music business, copyrights and the most valuable brand name in the world at abotu what apple has in cash and cash equivalents right now. It is a stunning overshot by Wall Street, and the last 200 points of the drop make absolutely no fundamental sense at all unless you believe Samdung really is the new thing and Bklackberry and Windows phones and HP and Intel tablets and Kindles are going to put Apple out of business.
Get a clue, folks. despite Samdung's cynical TV ads portraying themselves as the next new thing (parodying what apple was when it eclipsed Microsoft) Samdung are literally copycats of Apple's designs. So how can a copycat be the next new thing? Samdung also spends a huge amount of their money on ads and PR while Apple spends very little. Samdung currently has about 12 million in cash, 2 of which is locked up to have in order to pay Apple a settlement for copyright infringement. One reason Samdung has been so aggressive vs Apple is that Apple really did thraten to put them out of business when they won that unanimous jury verdict and award.
So yes, ther will be competition from whomever always, but let's be honest. Android and Samdung are not going to damage apple much, and the big "lead' Samdung has in smart phones is 90% in the cheapie low end area where Apple doesn't even want to compete. This will likely continue, Apple clominating the top end while Samsung and others dominate the low end. But anyone who has owned a cehap Android knows, those phones are not very good. They are the Hyundais to Apple's mercedes benz.
So Apple no growth? wrong. It is still growign,. And what happens if and when the China mobile deal is done? Apple will need to make a cheaper iPhone. But at the same time, it gets to sell another 100 million of them, so that is big growth. Also, no one knows if Apple will thunder into Hollywood and remake home entertainment delivery the way they did music, but they alone have the cash to do this. Hollywood suppliers all have their price and Apple is the one company who can afford to not only pay what needs to be paid, but literally take out any competitors. But will they? Who knows? But even without Apple TV, growth prospects re still fine for Apple, just not 50% a year anymore, more like 15% a year.
Also, I actually like the iWatch and iGlasses bling ideas. It is very cyper punk and hip, and samdung is already probably busy copying it,.
last week we got back 22 points. I would predict this is going to continue for a few months now, a retracement of about 100 points from here before real resistance appears again. That alone would put back 50% of the lost market cap since the march of the lemmings which took this stock to ridiculous levels, where it still is. In oth words, this is a no-brainer buy here, especially with an increased dividend.
The Falling Apple Knife May Have Hit The Floor; How High Might It Bounce? [View article]
It appears we are headed back to 590 area very rapadly. Beyond that, Apple needs to make a big announcement like China Mobile or Apple TV to show it has the means to add further high growth revenue streams to its already awesome cash generatinbg power,
IMHO, Apple is not fairly valued until the 800's, growth or no growth, but this is the way the Street punishes Apple for being so big, so 590 appears to be where this is moving, very quickly, in the next month. A dividend hike alone should be worth about 50 points so long as it also signals a new willingness by Apple management to reward and protect shareholders. What they did by ignoring the false rumors, short schemers and their own enemies' lies over the past 5 months has been inexcuseable. They need a new aggressive and defensive attitude now and we shareholders need to make sure they adopt it with action, not just talk. Though talk is a good start.
Regardless Of Price, Apple's Intrinsic Value Is Still On Its Way To $1,000 [View article]
Apple at $500 undervalued the company by about 70%. Their cash hoard alone is worth $150 a share. So you are saying $350 fully values the best company on earth? If they broke the company into four pieces, one piece alone would probably sell for that much. The IOS system alone is worth it, as is the hardware divisions, and cash and copyrights and music and so forth? Sold in pieces, this nis over a trillion dollar company. And that is BS that their growth days are finished. Yes, they gradually slow as the company gets bigger and bigger, but their positive cashflow is phenomenal. They make twice as much money as Google, Amazon and Samsung combined. And yet people are still selling or not buying below $500? Just incredible market sentiment error. And that is all it is, negative sentiment based on BS mostly. Fundamentals have gone out the window. But the pendulum always swings in these extreme imbalanced instances. Just look at Netflix. Six months ago, it was a worthless POS down 50%. Now it's a darling. And what has really changed? Not very much. Except the stock price doubled so they are considered a good investment. Again, just amazing stupidity. But I sure with Apple's management would wake up andb start buying their company back while it is so cheap. Double that dividend too. They can easily afford it and it would break the backs of any short and attract in a hundred billion in new investment.
Actually, the only problem with Apple is that for some bizarre non-sensical reason, investors have suddenly forgotten al fundamentalm rules of value, fundamentals and price to earnings ratio. They have also forgotten how nice iut is to have 137 bilolion in cash, no debt and few competitors, and to be the best damn company on the planet, maybe the best inn history, now selling below many doggie old tech names, cheaper than even HWP and Dell.
I have eben following this downfall of the stock oprice carefully and reading everyone and anyone to try and find out what the reason is., No one and I mean no one has given any real reason. Sure, technical chart breakdowns and lemming like follow the herd mentality traders are a big issue, so is Apple not defending itself better ()what better time now to buy back 10% of the company?), but except for the glitchy MapAps and two day China riot which hapened a long time ago and were fixed quickly, whatisn the prblem?
OK, I expected more of a beat last week. Based on the sterling Verizon numbers I expected another 5 million iPhones sold, but they still beat or met estimates and added 17 billionn in free cash to their coffers in a single quarter. Plus, while Samsung is an strong competitor especialloy in the developing world and Europe, does anyone really prefer a Samsung to the real thing? (yes, Samsung did copy the iPhone) And does anyone realize that while Samssung sells more units they make 30% of the profit per unit as Apple? And who else is really compoeting with Apple? WIndows? Old news. Blackberry (only among a clique of customers and in the Middle East) and in tablets, forgetaboutit, Apple rules.
So why all the hand-wringing and worrying? Even if Apple merely had the same resultds every quarter for the next ten years the stock is still worth twice what it's selling for now. And does anyone really expect Apple to decline any time in the next 5 years? Not likely since Apple ahs the best by far customer loyalty of any brand on earth and all current Apple customers will be Apple customers 5 years from now, maybe 50 yewars from now. So where is the beef? It's all phony, all a big mistake. Which is why I SCREAM BUY! This stock is the bargain of the decade.
More on Apple: Shares are rebounding today with the help of bullish comments from Goldman's Bill Shope, who declares shares oversold. "We continue to believe the best time to buy Apple’s stock is amid periods of supply-centric concerns," Shope argues ahead of Thursday's FQ4 report, while asserting Apple will be able to raise production and meet demand this quarter. BTIG's Walter Piecyk is more cautious, believing iPhone 5 shortages could translate into lost sales. [View news story]
Apple is probably at rock bottom now, or was Friday. The steep drop made no sense, never had anything to do with Apple except the first 700 to 680 drop which was justified for the China plant riot and Maps Aps controversy. But both issues turned out to be minor. As for the supply "shortages" there is not a single case where a customer has been unable to get an iPhone 5. Yes, some have to wait as long as 3 weeks for actual delivery, but many get it within 24 hours and I would venture to say Apple has lost next to zero customers because of this. In fact the high demand and modest waiting period have probably peaked interest and added to the specialness cachet.
I did my own research on this going to an Apple store and talking to the manager, then to a T-Mobile store which sells only Android. The T-Mobile store was empty, not a single customer. and only one employee. Lots of nice Samsung phones displayed, no customers. Then I went to the Apple store on a Tuesday morning. 150 customers, 40 employees, everyone busy as can be. The manager gave me five minutes and told me they are selling every iPhone they can make and not a single customer has complained about the waiting period. In fact Apple amkes it easy., You just go to Apple.com, pay for what you want then wait for a notification of where to pick it up. Typically the pickups are within 24-48 hours, sometimes like at Verizon's store, 3 weeks. Notice though how Apple is largely cutting out the retail middleman. That will only add to their profits and I expect sales to far exceed the conservative estimates of some who have been hand-wringing or trying to bring down the cost of the stock lately.
Also, Apple fell least week becvause their competitors missed earnings. Anyone want to do the math? Where did the money go if not to the competitors? A lot of it went to Apple instead. Apple is stealing market share from Android, PC's and enterprise. A tech executive I spoke to recently told me all the companies she works with have switched to Apple from Blackberry and Android. Even if that is an exaggeration, look out above when the APple money gets counted, and that will start very soon.
Apple Below $600: Trick Or Treat? [View article]
The fact is, Apple is now the first and only major company that pre-sells everything it makes before it makes it at high profit margin prices, and every new customer becomes a customer usually for life, and buys all sort of other things inside the wonderful Apple ecosphere.
People tout Samsung, but they are just a fancy hardware maker, and a copycat of Apple. People tout Google and Amazon, but they make no profit off their Pads and Google gives away Android to low end phone makers. Windows Phones, Tablets and Windows 8 are all duds. Blackberry and HP have been decimated by Apple. Intel is in trouble unless it gets a big Apple deal. And Apple has more free cash than all of them put together.
One more thing. Apple is the only one who has effectively cut out the retail middleman. Nowadays most iPhones are pre-sold directly on Apple.com or sold in Apple stores. Apple doesn't need retailers. And Sam,sung can make fun of Apple launch lines all they want, but who ever lined up to buy a Samsung anything? Not a single person on earth. And for good reason. They are fine products, but Apple is special and will be for many years to come. No real competition on the horizon ecept at the low margin end, which Apple is not really interested in anyway. Mercedes need not compete with Kia.
Apple Is Dirt Cheap And Should Be Bought [View article]
Error #1 was that Apple is out of ideas and can only go down from here, a no growth company. FALSE! But you see now the stock is priced for zero growth and zero new products. Error #2 is to call the last two quarters "misses" when whjile less than stellar in terms of growth, they met estimates last Q, grew sales in the most important categories and margins dipped only slightly. And even that slower growth was explainable as demand outstripped supply for about a month there. So while GOOG and IBM both diid about ther same as AAPL in terms of barely meeting last Q, AAPL got taken to thje woodshed and GOOG and IBM had big rallies even though their PE's are both much higher. and AAPl has enough cash to buy them both.
Error #3 - to forget Apple has more cash than God and its addition of free cash exceeds its earnings growth (not sure why, ask an accountant). They added 27 billion in cash the last two Q's when they supposedly "missed" and got taken down 35%. Just thnk of how many option s they have with 137 billion cash.
Error #4 - no new ideas,. How the F would anyone know that? Apple is very secretive abolut its next big things for good reason, because companies like Samsung are expert thieves and can steal and put out products quickly. (see the Galaxy phones which are not the "next big thing" they aree copycat products as proven in court.
Apple's next targhet is presumeable TV (next generation home entertianment) and boy could their cash be important there. Yes, buying Netflicks, Time-Warner Cable, even Time Warner itself, they have enough to buy anything in Hollywood they want. So stay tuned. If Apple wants it, they can have it and it is bound to be brilliant. (notice BTW Samsung came out with "smart TV" as soon as the Apple TV rumors began - copycats always).
Error #5 - Competition is killing Apple. Like who? Yes Samdung sells more units but makes 70% less profit on each and cheap models where Apple does not even compete. Apple will never be in the business of quantity, only quality. So for everyone making $40,000 or more in the world, Apple products are the best choice. Also, in Pads, Apple really has no serious competition. What, a Kindle Fire? Yes there are plenty of products to choose from, b ut if you want the best, Apple is again the choice.
Error #6 - Apple is stingy. Well so far partly true, but I expect the pressure is on the board to keep increasing that dividend starting probably after the board meeting on the 27th. And if they can offer as good or better than MSFT and INTC, a no-brainer which to own as a dividend and growth stock.
Anyway, you have the buying op of a lifetime now people, for the long term not as a trade. Aple is definitely worth $700 a share even without stellar growth, hell its brand name and copyrights alone plus cash are worth that much. Any extra growth now is justr gravy and no growth at all is priced in anymore. None. 10 PE people for the best company on earth. Grab it while you can under $500. A no-brainer now that the big overshoot freefall appears to be history. And if you're shorting AAPL now, say goodbye to your money.
Understanding Apple's Recent Share Price Weakness [View article]
Why Apple Will Continue To Climb [View article]
The good news is that the dishonest or deluded naysayers and worry warts about Apple have finally shut up, except for a few suspect Koreans. and the NY Times article about samdung maybe challenging Apple as the "cool" thing seems like a contrarian indicator. Samsung may be a fine product and cheaper but it's also a clone of the iPhone and has even lost in court over copyright infringement. The jury was 100% unanimous and took about two minutes to deliberate. The jury is in, Samdung is guilty and yet is also willing to spend all its money on aggressive ad campaigns designed to "appear" to be the hot new thing when they obviously are just following apple's lead (legally or not).
I see the other supposed "Apple killer" Google has rallied lately despite doing no better than Apple at meeting expectations, and being more than twice as expensive. and its own CEO is echoing that sentiment by cashing out at the top, smart guy. In fact smart anyone who trades in their inflated GOOG, Amazon and IBm shares now for AAPL which for some bizarre reason has been taken down 250 points and is now selling below book value and below even the worst pessimist's projected value.
Today's APPL price counts liquid hard assets and copyright value and nothing more. and it assumes Apple will not grow at all but instead will shrink. Which is totally divorced from reality to the tune of about a 300 billion dollar price differential. Which means you basically have a stock here hich should and probably will rise 50% this year, maybe even more.
So why are only a few people buying? and why are there any shares for sale at this ridiculously low price? Must be that the Market is still "stupid" about Apple. Stupid and short-sighted and still believing the BS convention wisdom of a few weeks ago, that Apple is on the decline, when there is no evidence to suggest anything like that, and it is very likely to happen for many years to come. In fact, I believe Apple can double in size and sales in just the next three years. I write this from South Ameica where Apple has just begun to penetrate. Yet everyone in south america seems to have a cell phone. So as incomes rise on this continent so will Apple sales. and the growth possibilities are truly astounding.
Apple: Answering 5 Important Questions [View article]
But once dropped below about 590 it became more and more and mroe ridiculously oversold. From 590 down to 440, this was a case of lemmings chasing lemmings and totally ignoring fundamentals. Technical chartists and short sellers ruled the day scaring off value buyers. The rumor that Apple's grown and high margin days are behind it created a paralysis amongst buyers. everyone started waiting for the bottom or a big rally ioff january earnings.
january earnings were actually good, that is a little disappointing but any other company would have killed for them. By the 60 pooint drop afterwards you would have thoght Apple missed, but they didnt. They lke Google barely met. Butg Google rallies and Apple dived. Though Apple made four times as much profit as Google, sells at half the PE of Google and added 17 billion in free cash.
(see now Google's CEO is cashing out his stock, evidence he considers it overbought. But is he buying AAPL? Well, he should)
Their margins went down a bit because they were adding new customers with last year's iPhones which for once were selling at a discount through phone carriers. Mini iPad was a lesser profit margin item but added millions of new IOS customers who will proobably become captive to IOS for a lifetime. Margins will go down again if and when the massive China mobile deal is done. But in exchange, Apple will grab 50 million new Chinese customers, the most affluent class there.
AAPL is now selling below book value, at less than half its real value and subtracting cash for about the value of its copyrights alone. Plus this iWatch story proves they are not only innovating, they are capabkle of opening up entire new markets which did not even exist previously. Their Apple TV concept may do the same as it could totally change the home entertainment concept and make Tv remotes and all othe annoying elements and limitations of current TV a thing of the past, again for affluent customers.
Nobody buys an Apple because it's cheap. They buy it because is the best (by far) and because it is the most useful, the best looking, a reak status symbol and because once a customer enters the IOS eco-system, he/she never leaves. brand loyalty is one of those intangibles worth hundreds of billions which is not at all priced into the stock these days. So don't worry about what the nay-sayers say. Samdung is not the "new thing". And their stock just ran up 20% anyway, as did Google. So get in cheap while you can. Because in case you hadn't noticed, for the past three sessions AAPL has been on fire, and we have only just begun to retrace the 200+ points back to even begin to approach true value. Plus we'll get a better dividend now. So what's not to like?
Apple Below $600: Trick Or Treat? [View article]
First to start, once the damn election is over the Street will stop worrying about that and a fiscal cliff avoidance deal will be reached. Just a matter of whether the rich may a little more of not, or if the GOP sticks it to the middleclass and poor instead. Either way there will be a deal and the market aw a whole will rally.
After that, Apple will begin to leak out the numbers going into christmas and the estimates will rise and rise and rise. The January earnings report will be the biggest in corporate history, and March should be equally collosal. Then Apple will tell us what is will do with its (by then) 140 billion mountain of cash. Here are a few possibilities:
1) Spend 20 billion to buy out Hollywood's content deals, including Time Warner Cable if they want it, and launch Apple TV with more content than anyone on earth.
2) Buy up bandwidth via towers and own the 4G and 5G worlds.
3) Buy a search engine like Yahoo (the whole company maybe) and jettison Google.
4) Up the dividend to 3% plus more stock buybacks.
5) Expand Apple stores and cut out retail middlemen completely.
6) Buy up whatever supply chain plants and foundries they need to up their output potential in very dependable ways.
And they can do all six and still have plenty of cash left. So ask yourself, what other stock in the world sells for 10-15 PE and has anything remotely as amazing going for it? Zero.
Apple's Worst Day In Nearly 4 Years [View article]
Apple Is Misunderstood By Both Analysts And The Media [View article]
Apple is now the cheapest major stock in the world versus real earnings and value, and largely recession proof, and yet is on the verge of the two biggest quarters in world history and growing handily in all sorts of new places and ways. Even last quarter when it supposedly "missed" was a great quarter. They sold 27 million iPhones before the big refresh. Wow. And the only reason their profits weren't quite as high is that huge rollouts like these require great cash expenditures and now that this money has been spent, Apple has become like a gigantic money machine where every unit is pre-cold before it is made online without middlemen taking commissions and customers are willing to wait because the product is so good and so special.
Apple was also taken down 100 points for really bogus reasons which only make sense to a technical chartist. Nothing at all to do with fundamentals or reality. The China riots and Map Aps problems were short-lived and minimal. The supply chain is humming but can only be a problem if customers stop waiting and buy another brand, which they are not doing.
Plus, did you notice that Apple added 10 billion in additional cash to its reserves in one quarter, and in every quarter? Now with 120 billion? Some analysts have seen that as a major problem? Problem? That is the best problem in the world, along with pre-selling everything you make before you even make it at top price and top profit margin. These are Apple's problems. Too much money too many eager afffluent customers. Great problems to have.
I am glad the markets are closed because this insanity of poo-pooing Apple needs to pass like an illness. And it will. In fact soon I expect the same talking heads who have been poo-pooing Apple will be asking when it hits 1000 again? So, as investors, we need to do the sensible thing. BUY when it hits these lows and sell only when it hits great highs, and it hasn't yet hit those highs. 700 was actually still a modest price as it was only at a 14 PE with 30% growth. Cheap stock, fantastic company, huge growth and success almost a certaionty for years to come. And as for the comeptition, except for Samsung phones, they really don't have any. At least not in the $329 and up range.
Prepare Now For The Looming Fiscal Cliff [View article]
In the US, the rightwing strategy has been to do everything to hurt the economy so that Obama has a bad record to run on. But the election is only a few months away and the game is almost up. Obama will likely win and congress may even change hands. So instead of committing mas suicide the rightwing congress will at the very least try to be reasonable enough to kick the can down the road, or come to a compromise. Or, if Romney wins, watch the word "deficits" disappears from the rightwing lingo and for them to start spending big-time again. Lots of corporate welfare and tax cuts for the rich. For the country, it would be a lot better fro DEms to win, but either way, whoever is in charge will have no choice but to settle this fiscal cliff issue so as not to cut their favorite programs or raise taxes and be blamed for that next election.
Apple: The $200 Billion Question [View article]
Get a clue, folks. despite Samdung's cynical TV ads portraying themselves as the next new thing (parodying what apple was when it eclipsed Microsoft) Samdung are literally copycats of Apple's designs. So how can a copycat be the next new thing? Samdung also spends a huge amount of their money on ads and PR while Apple spends very little. Samdung currently has about 12 million in cash, 2 of which is locked up to have in order to pay Apple a settlement for copyright infringement. One reason Samdung has been so aggressive vs Apple is that Apple really did thraten to put them out of business when they won that unanimous jury verdict and award.
So yes, ther will be competition from whomever always, but let's be honest. Android and Samdung are not going to damage apple much, and the big "lead' Samdung has in smart phones is 90% in the cheapie low end area where Apple doesn't even want to compete. This will likely continue, Apple clominating the top end while Samsung and others dominate the low end. But anyone who has owned a cehap Android knows, those phones are not very good. They are the Hyundais to Apple's mercedes benz.
So Apple no growth? wrong. It is still growign,. And what happens if and when the China mobile deal is done? Apple will need to make a cheaper iPhone. But at the same time, it gets to sell another 100 million of them, so that is big growth. Also, no one knows if Apple will thunder into Hollywood and remake home entertainment delivery the way they did music, but they alone have the cash to do this. Hollywood suppliers all have their price and Apple is the one company who can afford to not only pay what needs to be paid, but literally take out any competitors. But will they? Who knows? But even without Apple TV, growth prospects re still fine for Apple, just not 50% a year anymore, more like 15% a year.
Also, I actually like the iWatch and iGlasses bling ideas. It is very cyper punk and hip, and samdung is already probably busy copying it,.
last week we got back 22 points. I would predict this is going to continue for a few months now, a retracement of about 100 points from here before real resistance appears again. That alone would put back 50% of the lost market cap since the march of the lemmings which took this stock to ridiculous levels, where it still is. In oth words, this is a no-brainer buy here, especially with an increased dividend.
The Falling Apple Knife May Have Hit The Floor; How High Might It Bounce? [View article]
IMHO, Apple is not fairly valued until the 800's, growth or no growth, but this is the way the Street punishes Apple for being so big, so 590 appears to be where this is moving, very quickly, in the next month. A dividend hike alone should be worth about 50 points so long as it also signals a new willingness by Apple management to reward and protect shareholders. What they did by ignoring the false rumors, short schemers and their own enemies' lies over the past 5 months has been inexcuseable. They need a new aggressive and defensive attitude now and we shareholders need to make sure they adopt it with action, not just talk. Though talk is a good start.
Regardless Of Price, Apple's Intrinsic Value Is Still On Its Way To $1,000 [View article]
The Problem With Apple Is Apple [View article]
I have eben following this downfall of the stock oprice carefully and reading everyone and anyone to try and find out what the reason is., No one and I mean no one has given any real reason. Sure, technical chart breakdowns and lemming like follow the herd mentality traders are a big issue, so is Apple not defending itself better ()what better time now to buy back 10% of the company?), but except for the glitchy MapAps and two day China riot which hapened a long time ago and were fixed quickly, whatisn the prblem?
OK, I expected more of a beat last week. Based on the sterling Verizon numbers I expected another 5 million iPhones sold, but they still beat or met estimates and added 17 billionn in free cash to their coffers in a single quarter. Plus, while Samsung is an strong competitor especialloy in the developing world and Europe, does anyone really prefer a Samsung to the real thing? (yes, Samsung did copy the iPhone) And does anyone realize that while Samssung sells more units they make 30% of the profit per unit as Apple? And who else is really compoeting with Apple? WIndows? Old news. Blackberry (only among a clique of customers and in the Middle East) and in tablets, forgetaboutit, Apple rules.
So why all the hand-wringing and worrying? Even if Apple merely had the same resultds every quarter for the next ten years the stock is still worth twice what it's selling for now. And does anyone really expect Apple to decline any time in the next 5 years? Not likely since Apple ahs the best by far customer loyalty of any brand on earth and all current Apple customers will be Apple customers 5 years from now, maybe 50 yewars from now. So where is the beef? It's all phony, all a big mistake. Which is why I SCREAM BUY! This stock is the bargain of the decade.
Apple's CEO Discusses F1Q 2013 Results - Earnings Call Transcript [View article]
More on Apple: Shares are rebounding today with the help of bullish comments from Goldman's Bill Shope, who declares shares oversold. "We continue to believe the best time to buy Apple’s stock is amid periods of supply-centric concerns," Shope argues ahead of Thursday's FQ4 report, while asserting Apple will be able to raise production and meet demand this quarter. BTIG's Walter Piecyk is more cautious, believing iPhone 5 shortages could translate into lost sales. [View news story]
I did my own research on this going to an Apple store and talking to the manager, then to a T-Mobile store which sells only Android. The T-Mobile store was empty, not a single customer. and only one employee. Lots of nice Samsung phones displayed, no customers. Then I went to the Apple store on a Tuesday morning. 150 customers, 40 employees, everyone busy as can be. The manager gave me five minutes and told me they are selling every iPhone they can make and not a single customer has complained about the waiting period. In fact Apple amkes it easy., You just go to Apple.com, pay for what you want then wait for a notification of where to pick it up. Typically the pickups are within 24-48 hours, sometimes like at Verizon's store, 3 weeks. Notice though how Apple is largely cutting out the retail middleman. That will only add to their profits and I expect sales to far exceed the conservative estimates of some who have been hand-wringing or trying to bring down the cost of the stock lately.
Also, Apple fell least week becvause their competitors missed earnings. Anyone want to do the math? Where did the money go if not to the competitors? A lot of it went to Apple instead. Apple is stealing market share from Android, PC's and enterprise. A tech executive I spoke to recently told me all the companies she works with have switched to Apple from Blackberry and Android. Even if that is an exaggeration, look out above when the APple money gets counted, and that will start very soon.