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thepartyisover

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  • Apple: Let Us Not Get Overexcited [View article]
    Apple has actually reduced shares by more than 8% since the beginning of 2013. The yahoo information you have is not updated for Apple most recent quarter.
    Apr 24 12:24 PM | 1 Like Like |Link to Comment
  • Cook Does Icahn's Dirty Work At Apple [View article]
    You could pick any point in time and say that any stock has underperformed the market during that time. I could easily pick a longer horizon and say that Apple has outperformed the S&P by a wide margin during that time. There is no magic rule that a stock has to outperform the S&P.

    The argument that Apple is going to stagnate into Microsoft is severely flawed. Expectations for Microsoft were very high in the early 2000's and the P/E reflected that. Expectations for Apple are fairly low today and it could easily exceed these expectations without much growth.
    Apr 24 11:52 AM | Likes Like |Link to Comment
  • Cook Does Icahn's Dirty Work At Apple [View article]
    I don't know how you define "years" but Apple has moved significantly higher over the past five years. The P/E multiple was much higher five years ago and the cash on the balance sheet was much lower. If you define years to mean the last two years, cash has grown significantly and earnings per share has risen while the stock price has been volatile.

    Astute investors actually do like to pay for cash. In fact, that's what they love most - to buy a dollar for less than a dollar. Apple's price is representing a huge margin of safety as the price is discounting negative growth, net of cash, while the business actually is growing.
    Apr 24 11:07 AM | Likes Like |Link to Comment
  • Cook Does Icahn's Dirty Work At Apple [View article]
    While Microsoft's stock price may have floundered since the early 2000's, it's business grew significantly. The comparison to Apple is not really fair though because Microsoft started at a much higher multiple when it stagnated. Apple's valuation is starting where Microsofts ended, after multiples compressed
    Apr 24 01:13 AM | 3 Likes Like |Link to Comment
  • Apple's June Quarter Guidance Could Cause A Downdraft In The Shares [View article]
    I think the 2Q guidance doesn't matter. People are already looking towards the 3Q when all the new products are released.
    Apr 21 02:21 PM | 2 Likes Like |Link to Comment
  • Apple Faces A Problem And Increasing Prices Will Make It Worse [View article]
    I think what this article fails to realize is that Apple can temporarily increase prices when the phone is initially released and then lower prices back down after a quarter or so. By doing so, Apple would be able to sell quantity as well as get higher margins. If Apple does follow such a strategy, I think it would actually benefit consumers that value time highly as they would be able to purchase one on day one without spending a day in line.

    Pricing power and brand values are closely related. Apple has the most valuable brand in the world and a monopoly on the iPhone/iOS. Google doesn't have pricing power in the smartphone world, and neither do their commodity phone producers.
    Apr 15 08:21 AM | 1 Like Like |Link to Comment
  • Apple: A Value Stock With Numerous Growth Kickers [View article]
    Apple is actually outperforming by more than the chart in your article suggests as the 3.05 div went ex as well.
    Feb 10 06:02 PM | Likes Like |Link to Comment
  • Apple's Earnings Mediocrity [View article]
    Apple could easily cure its margin compression by changing its pricing strategy. Early adopter? Pay a higher price the first month and then lower it. The phone would probably still be in short supply.

    Personally, I hope Apple's shares go lower in the short run so that the company can buy back more shares at a lower price and improve metrics for the long run.
    Oct 29 05:12 PM | Likes Like |Link to Comment
  • Carl Icahn Spells The End Of An Era At Apple [View article]
    Apple doesn't create its own P/E. Market participant expectations create Apple's P/E. While the P/E is more akin to that of a retailer than that of a technology leader, these days most market participants are not "investors" and have no idea how to value companies.

    "many cling to the notion that the market will see the error of its way and cause a tremendous surge in share price." Isn't that what we've been seeing?

    "Cash adds nothing to P/E. If anything, it diminishes the level and serves to curb share price " I agree, cash adds nothing to P/E but there are a lot of people using one factor valuation metrics (i.e. P/E) to compare companies to evaluate relative attractiveness. While P/E is a good measure of value, if a company has significant amounts of cash that it is returning to shareholders, the P/E is overstated as each share bought back increases the earnings of each remaining share.
    Aug 13 11:15 PM | Likes Like |Link to Comment
  • Carl Icahn Spells The End Of An Era At Apple [View article]
    Its not fair to apply the P/E of a retailer to a company that has profit margins the size of apple's. Additionally, net of cash, the P/E multiplier is in the single digits. It may be true that Icahn is in it "for the cash" but that doesn't make his argument that Apple is undervalued wrong.
    Aug 13 05:39 PM | Likes Like |Link to Comment
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