@Ryche: You're missing the point, but this conversation will go on forever if we continue... EPS growth rate declined substantially and for the most recent quarter turned negative. This should be of some concern to investors... Obviously they're not going bankrupt per your sarcastic comment, but it is a concern. P/E doesn't look as good if negative EPS growth ensues; still relatively low, but not as strong. I figured some of you readers would understand this. FYI, I'm not an Apple bear and I enjoy / like the company's products.
@red: One definition of "contraction" means shrinking. How is Apple's EPS not shrinking when you compare Q1 of this year to Q1 of last year? Diluted EPS of $13.81/share for quarter ended 12/29/12 and diluted EPS of $13.87/share for the quarter ended 12/31/11. That's considered negative growth.
About visibility: I meant Apple investors have little visibility into the future. How do you have any idea what's going to drive Apple's earnings in 5 years, let alone 3 years?
@red: You're right. There are no other great investments out there. In fact everyone should just put 100% of their portfolio in Apple because it's "guaranteed" to make money. In the meantime, you've been losing money on Apple and others have been making money either in an index fund, many other stock picks, preferreds, even currencies. The problem is Apple is a tech company with lots of competition and very little visibility into the future. You can do all the arithmetic you want but Apple is still going down... Don't be mad because you're losing money and you don't understand it.
EPS contraction in the most recent quarter compared to prior year comparable quarter. Say what you like but the market thinks that Apple's growth days are over. That's not too far fetched. If zero or negative growth ensues Apple's "extremely" low P/E ratio looks more reasonable. Competition and supply chain constraints are two serious issues here. Nothing I say will change your mind though bgold. Good luck with your investments.
It doesn't matter what you think Apple is worth; it only matters at what price Apple trades. You can kick and scream all you want, but Apple is $457/share and the technicals are still negative. Growth will likely slow significantly and margins will likely contract from here unless Apple releases another new, high margin product no one else will offer. A great company isn't necessarily a great investment. Too many people have fallen in love with Apple stock. There are plenty of other great investments out there.
@JUDOKA: I'm not sure what you're getting at, but I'm referring to the concept that a fundamental analysis of Apple yields an undervalued stock. However, this has been the case for quite some time. Maybe "manipulation" was the incorrect word choice, but the point is that Apple is not being recognized by the market for the market leader it is and the significant cash flow generation Apple achieves. I exited out of Apple because it appears that fundamental analysis achieves little in determining expected return in AAPL.
I was long Apple and have never shorted Apple... I am no longer long Apple (no positions in the stock). It seems like too much manipulation going on in the stock for me to handle. As for your other comment, I had never previously used a Galaxy S3 before. Upon reviewing the phone selections with my brother I was impressed with the S3. I'm not taking aware from the iPhone because it is very reliable and has good batter life in my experience, but I feel as though the S3 offers a better user experience (and I was surprised that I liked the bigger screen).
I'm in the camp that thinks the iPhone 5 is inferior to the Galaxy S3 and will likely be switching to a Samsung phone upon upgrade (currently an iPhone user). My brother recently upgraded to an S3 and it is incredible! More features, bigger/more colorful screen, and I like the customization factor.
Apple And Microsoft: A Holiday Retail Study [View article]
You're partially right. Investing is about profits and growth rate of profits. Last time I checked Apple's profits and profit growth rates are substantially larger than Microsoft's... Holiday sales tend to be the biggest top line and bottom line contributor for tech products so holiday sales/profits are important for investing. Don't be fooled.
Apple's R&D expense is 1/3 of Microsoft's and look at Apple's profitability and sales compared to Microsoft. Sorry, but not much of a comparison! Apple is much more efficient with each R&D dollar spent.
Apple And Microsoft: A Holiday Retail Study [View article]
Innovation spurs long-term profitable growth in the technology sector. Clearly Microsoft has lost its innovative touch. It's just copying other products/business models from here on out. Good luck.
Apple And Microsoft: A Holiday Retail Study [View article]
The technology sector changes so quickly, your statement of Microsoft being larger than Apple in 5 years is nothing but a hope and a guess. However, if recent history is of any relevance, that certainly will not be the case.
Put it this way, I don't know of any of my friends, co-workers or acquaintances clamoring for a Microsoft product. Do you?
Apple And Microsoft: A Holiday Retail Study [View article]
@dannydyn: you beat me to the punch! I couldn't agree with you more, especially on the store design and store concept. Apple is so successful that Microsoft has to "fall in line" and copy Apple just to try to stay competitive.
Look Out Below: Apple's Unit Profits Are Falling [View article]
Thanks Stephen. I disagree with you on the price target for a number of reasons, but I appreciate the article. Interesting to see trends on unit profitability. Happy investing.
Look Out Below: Apple's Unit Profits Are Falling [View article]
"Back in March, I called for a $700 share price. Apple hit that price in September. It's time to set a new Apple price target of $480."
Is $480/share your 1-year price target? And this is based solely on the assumptions of supply/demand constraints and diminishing unit profits?
If you're so confident Apple will decline to $480 why not short the stock? That's a quick and easy 12% gain from its current trading price. Your user profile states "I put my money where my mouth is". I find it rather comical how so many "investment professionals" are quick to disseminate investment ideas, but don't back up the investment thesis with personal/professional funds. It's one thing to write a negative article, but it's entirely different to invest according to your recommendations. Generally speaking, if a person is not going to invest according to his/her analysis, the analysis is baseless.
Apple's product appeal is not contingent upon movements in the stock price. If anything it would be the other way around. However, stock price movements are determined by profits and cash flow and have no bearing on the "coolness" of a product. Last time I checked Apple has experienced and will likely continue to experience significant revenue and profitability growth.
Apple makes reliable, easy to use and innovative products. Apple has such strong demand that it can barely produce enough iPhone 5s and iPad minis to satisfy consumers worldwide. It has created an interconnected product ecosystem that yields greater results for consumers who own multiple Apple devices, which has helped increase its brand loyalty. Apple has a strong following from its current customers/users and strong interest from a lot of non-users.
For someone who is the Executive Vice President and Director of Research for America First Investment Advisors, LLC I would think your analysis would be of much higher quality.
Apple Is Not Worth $460 [View article]
Apple Is Not Worth $460 [View article]
About visibility: I meant Apple investors have little visibility into the future. How do you have any idea what's going to drive Apple's earnings in 5 years, let alone 3 years?
Clearly you disagree with me and that's fine.
Apple Is Not Worth $460 [View article]
Apple Is Not Worth $460 [View article]
Apple Is Not Worth $460 [View article]
Will Apple Get Its Mojo Back? [View article]
Will Apple Get Its Mojo Back? [View article]
Will Apple Get Its Mojo Back? [View article]
I'm in the camp that thinks the iPhone 5 is inferior to the Galaxy S3 and will likely be switching to a Samsung phone upon upgrade (currently an iPhone user). My brother recently upgraded to an S3 and it is incredible! More features, bigger/more colorful screen, and I like the customization factor.
Apple And Microsoft: A Holiday Retail Study [View article]
Apple's R&D expense is 1/3 of Microsoft's and look at Apple's profitability and sales compared to Microsoft. Sorry, but not much of a comparison! Apple is much more efficient with each R&D dollar spent.
Apple And Microsoft: A Holiday Retail Study [View article]
Apple And Microsoft: A Holiday Retail Study [View article]
Put it this way, I don't know of any of my friends, co-workers or acquaintances clamoring for a Microsoft product. Do you?
Apple And Microsoft: A Holiday Retail Study [View article]
Look Out Below: Apple's Unit Profits Are Falling [View article]
Look Out Below: Apple's Unit Profits Are Falling [View article]
Is $480/share your 1-year price target? And this is based solely on the assumptions of supply/demand constraints and diminishing unit profits?
If you're so confident Apple will decline to $480 why not short the stock? That's a quick and easy 12% gain from its current trading price. Your user profile states "I put my money where my mouth is". I find it rather comical how so many "investment professionals" are quick to disseminate investment ideas, but don't back up the investment thesis with personal/professional funds. It's one thing to write a negative article, but it's entirely different to invest according to your recommendations. Generally speaking, if a person is not going to invest according to his/her analysis, the analysis is baseless.
Just one observers opinion.
Apple's Improbable Math [View article]
Apple makes reliable, easy to use and innovative products. Apple has such strong demand that it can barely produce enough iPhone 5s and iPad minis to satisfy consumers worldwide. It has created an interconnected product ecosystem that yields greater results for consumers who own multiple Apple devices, which has helped increase its brand loyalty. Apple has a strong following from its current customers/users and strong interest from a lot of non-users.
For someone who is the Executive Vice President and Director of Research for America First Investment Advisors, LLC I would think your analysis would be of much higher quality.