Seeking Alpha

Kevin Murphy

Kevin Murphy
Send Message
View as an RSS Feed
View Kevin Murphy's Comments BY TICKER:
Latest  |  Highest rated
  • A Critique Of Carl Icahn's Apple Fair Value Revaluation To $240 Per Share [View article]
    Yep, Icahn stepped in it on AppleTV. But maybe not so much as it seems.

    First, AAPL is definitely getting into the "TV business", but not by making a big screen TV (as a stockholder I'm thankful for that). There is a huge opportunity for disruption in the current TV biz. The normal channels are fading except for sports events, and cable is riding a staggering horse. Over-the-top, like NFLX and others is just starting. AAPL is clearly looking at programming and delivery as markets to disrupt. Plus their new AppleTV box will likely make the experience much more user friendly.

    So I expect to see some interesting stuff coming from AAPL in program delivery, ad placement, and delivery.

    And what about making screens? It's highly competitive and low margin, thus quite unattractive for AAPL. I reckon AAPL will come out with a laser based projector instead. Look at PicoPro, by Celluon - it is a laser projector in a package the size of an iPhone6. It uses lasers by Microvision (MVIS).

    It's possible to put a very bright projector into iPhone 7 or 8, then we'd all have our TVs right with us. PicoPro can project an image as big as 100", quite bright. Make the screen smaller and it gets brighter.

    With that on the way, why make a TV screen? I'm guessing that in places that are space constrained, like apartments in China India etc etc, a cheaper better alternative is a projected image via a device we carry in our pockets.

    May 19, 2015. 02:20 PM | 8 Likes Like |Link to Comment
  • Northstar Is Far From An Intelligent REIT Alternative [View article]
    I'd hate to pay the hedge fund rate of "2 and 20" for a REIT. Thankfully, NRF is not a hedge fund, so i don't have to. In all respects, NRF has been an excellent investment for me. Since buying in Sept 2013, I have more than doubled the value, plus gotten a spinoff of NSAM, which has also more than doubled. That's a helluva winner, not even counting divvies.
    May 18, 2015. 10:17 AM | 2 Likes Like |Link to Comment
  • Williams: Move To 'Kinder Morgan Structure' Should Support Dividend Growth Story [View article]
    Does anyone know how the deal will be taxed for WPZ owners?
    May 13, 2015. 10:48 AM | Likes Like |Link to Comment
  • Intel Inside Microsoft HoloLens And Windows Phone [View article]
    The key piece of technology inside Hololens is the laser tech -- probably from Microvision (MVIS), is the Seattle area.

    It takes lasers to create the holographic images, without which the Hololens won't work, and also to "see" things that are in the way of robots, which are part of the impressive Hololens demo given last week by MSFT.

    Some of the people who created the MVIS technology now work for MVIS, but MVIS holds the patents and knows how to make the laser modules.

    It's also possible that a laser projector would be imbedded into MSFT's cell phones and gaming devices.
    May 2, 2015. 04:20 PM | Likes Like |Link to Comment
  • Apple: Big Opportunity To Create Value In Mobile Payments [View article]
    Seems to me that the article & comments miss the real revenue opportunity for AAPL.

    Credit card fraud is a being problem for Visa, Mastercard & their banks. ApplePay helps to reduce the opportunity for fraud. Once enough history is collected on the rate of fraud that happens with ApplePay transactions, the value will be clear and proven. At that point in time AAPL's share of transaction fees can double, and eventually approach 0.40.

    That becomes a lot of money dropping to the bottom line. As Stone Fox points out, this is very high margin income.

    I don't think AAPL wants to do without the card issuers, the world is simpler for them, as others have pointed out. They are much better off working in partnership with them as it cuts AAPL's costs to the bone. Besides, if they tried to move in on the card issuer's turf, they'd have a fight on their hands that would essentially kill a very profitable business that is easy to administer.

    I look forward to an increase in dividends, part of it falling down from the ApplePay tree.
    Apr 1, 2015. 10:00 PM | 3 Likes Like |Link to Comment
  • WSJ: Apple talking Web TV service for fall launch [View news story]
    I have an antenna -- hi def broadcast, quality is better than cable.
    Mar 16, 2015. 10:46 PM | 4 Likes Like |Link to Comment
  • Why Is Apple Making A Gold Watch? [View article]
    Will they sell 1,000 gold watches? Almost certainly. This is $1 billion in revenue, which would cover all development expenses for all models of the watch, plus the cost of making the thousand watches, plus contribute some profits.

    Look at this as a business decision. Everyone reading this publication is an investor or has investment interests. As an investor, I'm more than pleased. This is a great way to make money and leverage the brand.

    And I can buy the same thing for $400. Pretty good deal for the little people like me.

    Someone made a comment already that it's possible to replace the guts of the watch, and AAPL will probably have such a program. I'd be surprised if the gold watch does not come with a guarantee that the watch internals will be upgraded for free for 1 or 2 product iterations, maybe more.
    Mar 12, 2015. 07:14 PM | 9 Likes Like |Link to Comment
  • Notes On Cars (And Apple) [View article]
    If it can see the potholes when it's raining and the pothole is filled with water, that would be very impressive.
    Mar 2, 2015. 10:45 PM | 2 Likes Like |Link to Comment
  • Notes On Cars (And Apple) [View article]
    I think GOOG is doing that...

    plus developing an app that causes rainbows to shine whenever Google cars are on the road
    Mar 2, 2015. 10:38 PM | 2 Likes Like |Link to Comment
  • Notes On Cars (And Apple) [View article]
    Maybe AAPL is onto something else? Why go to all of the bother of going to Hilton Head. AAPL can make a virtual reality machine that I'd keep in my garage - a VR Car. Then all I'd have to do is get in the VR Car, select Hilton Head, it would take me there and show me around.

    The windows would all be LED screens and it would be exactly like the car went to Hilton Head, except much more energy efficient. Think of the industries that could be disrupted - cars, hotels, gas stations...

    It could even have a little kitchen window, in the trunk. It would replicate local cuisine -- some good Carolina BBQ, or maybe some crawdads, hush puppies etc. I don't think AAPL wants to get into the grocery biz, so they'd farm that part out to AMZN, which would deliver the stuff via drone to the garage & from there it's put into the kitchen/trunk & from there into the car via the service window.

    What to do once we get there? How about going to the movies, or a rock concert? They would appear in the windows while I ate my popcorn in the car's lounger.

    As in most markets, porn would be the initial killer app. The early cars might be x-rated, and replicate my 1st trip to the drive-in movie, with some nice robotic features.

    By golly, I think we've broken the code...
    Mar 2, 2015. 07:51 PM | 8 Likes Like |Link to Comment
  • Micron: The World According To NAND [View article]
    I wonder why those who wonder where all the new data will come from cannot see some obvious sources.

    - By the end of this decade every cop in the US will be wearing a data cam that uploads the cops workday in video format to some data farm.

    - There are more street cameras recording intersections, toll booths, store fronts, ATMs, cash registers and so on every day.

    - Street views on Google & other map apps are updated more and more frequently.

    - Defense departments create more and more visuals.

    - Mining companies are mapping more and more data.

    - Shipping containers can be used as bomb delivery media by terrorists and the infrastructure for monitoring every container in the world 24x7 is already scoped out by companies that own these containers.

    - I think security (national & property & personal) will soak up tremendous amounts of data.

    - Cameras on cell phones take higher density photos & films with each new iteration. Social media continue to grow.

    - Advertising via PC and cell phones gets increasingly sophisticated, especially visually.

    - Education is moving online -- Stanford, Harvard, and other major institutions have created online courses, which can reduce the unsustainable costs of a good education.

    - Medicine is moving online, with X-Ray & MRI images being cataloged and stored in huge medical databases.

    There is a lot happening to soak up data, and most of it is outside the traditional enterprise applications that your grandfather worked on -- and that this particular grandfather worked on as well for a couple of decades.

    One thing that really kills me is how I was incapable of seeing how Google search, for example, would disrupt traditional advertising media. Now my eyes are opened a little bit to future apps, and I don't want to miss future innovations that are essentially data dependent.

    Thanks for the fine article and all the comments.
    Feb 20, 2015. 11:43 AM | 17 Likes Like |Link to Comment
  • Apple Entering The Car Sector? Why This Could Be Its Next 'Large Numbers' Move [View article]
    My guess: APPL will fold the car business into the home control business, and take on another huge industry while they are at it -- the electrical utilities.

    Imagine this scenario:
    - A fuel cell in the garage, running on NG.

    - Fuel cell makes enough electricity to charge the electric car.

    - Fuel cell makes enough electricity to run the home.

    - AAPL provides the intelligence to manage all of this, including the base load and peak loads of power to be made.

    The fuel cell and power/home management can be used with any battery driven car -- or any that integrates with AAPL's design criteria and interface specs.

    The AAPL car integrates seamlessly, maybe provides the best driving experience, but it is not essential to the goal of putting fuel cells into homes. The car battery can also be used as backup energy for the home, when it is parked in its station (in the garage, or carport, or parking spot in the condo garage).

    This would be a cool way to integrate several projects that AAPL seems to be working on as separate efforts.
    Feb 19, 2015. 04:22 PM | 2 Likes Like |Link to Comment
  • WSJ: Apple car project is for real, and it's a minivan [View news story]
    Lots of outsourcing in the auto industry:

    Johnson Controls does interiors and electronics. Harmon does electronics -- like entertainment systems. The servo motors the lift windows are outsourced. Entire interiors of car doors are outsourced. Transmissions are outsourced to a great extent... and let's not even talk about batteries, for trad cars or hybrids or electric cars. I mean everything -- seats, switches, dashboards, locks, glass... for virtually all cars.

    All these suppliers would be more than happy to work with AAPL to develop a new car. And perhaps cover the costs of R&D for the project.

    I'm just puzzled by AAPL wanting to get into such a business.
    Feb 13, 2015. 09:49 PM | 5 Likes Like |Link to Comment
  • Apple Numbers Get Serious [View article]
    Good article, but I think your concern is unwarranted. My guess is that Cook, as a very savvy manager, understands exactly what you are saying about the huge market cap of AAPL being a potential sea anchor dragging down the future price of the stock. So what to do about it?

    How about splitting off separate business units?

    Here are some ways they can do this:

    - Payments processing, if it takes off as it seems to be doing now, can be a business totally separate from the hardware segment at some point in time.

    - Apple TV, if it goes in the direction that some expect it to, can be a separate business.

    - Devices, like Macs, MacBooks, tablets and phones can be separate.

    - iTunes can be a separate business, at some point.

    - Healthcare apps, delivered via Apple devices, can be a huge business on its own, and why not offer it on other devices from Android, HP or whatever?

    - Same for HomeLink after it establishes market position. Maybe it acquires some home security companies that run alarm systems? Great sales force & infrastructure.

    Of course the challenge is to keep them all on the same page in terms of design and integration. I think that can be solved -- at least for a time. If those businesses are spun off, not all at once, but over time, then they can be reined in.

    But as an investor, I don't care much if AAPL gets so big that eventually it becomes separate competing companies, I'll own several companies that will all be competitive, even if they fight among themselves for revenue, acquisitions, business vision etc.

    Spinning off businesses like this may be how it all ends for AAPL, but it is also how it all grows into separate successful businesses -- and makes more money for me.

    Imagine if MSFT had the guts to do something like this:

    - Windows SW as a separate business.

    - Gaming as a separate business.

    - Media as a separate business (MSNBC & Slate might be very different now).

    - Hardware (mice etc) as a separate business.

    The company would be totally different and investors would probably be better off. Maybe something like Media would have been killed in its crib, or maybe it would have been much more successful as a separate company.

    Regardless, thank you for the thought provoking piece.
    Feb 12, 2015. 09:46 PM | 1 Like Like |Link to Comment
  • Apple beats estimates, guides in-line [View news story]
    Yep, everyone that wants a phone already has one. Too bad for Tim Cook, next quarter they'll have zero revenue.
    Jan 27, 2015. 05:11 PM | 2 Likes Like |Link to Comment