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Jack Baker

Jack Baker
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  • Apple: Not Out Of The Woods Yet [View article]
    Beware of the Galaxy S5? No, I don't think so. The S4 was underwhelming. The S3 and S4 still are having a lot of battery problems too. I suspect the S5 to continue the trend -- despite all of the awkward charades Samsung will undoubtedly try on stage somewhere at rollout in a poor and shameless attempt to once again copy everything Apple does. Curved glass? Gold metal frame? Is this the "innovation" that will finally succeed for Samsung at the high-end? I think not.

    Tablets? Look, it's a race to the bottom for every OEM other than Apple. While Apple is selling every iPad air and retina mini then can stamp-out in a day at premium prices, other OEM's fight for scraps at the low-end. Recent reports show that MSFT is now switching their attack adds towards Samsung in the tablet wars. They have effectively given-up attacking Apple as the ads are not working. So, now they will beat on Samsung for a while; and also Screwgle. While Apple enjoys tremendous success in tablets the other OEM's scratch their heads whilst selling their tablets at a loss for market share. "How can this be" they say. "We've tried everything. We knock-off their commercials style, we make specious comparisons between our tablets making them seem better (Amazon), but still Apples tablets fly off the shelves while ours collect dust." It's reminiscent of the scene in The Grinch that Stole Christmas when the Grinch can't understand why the Hoos in Hooville are still happy and singing after he stole all of their presents and trimmings. Samsung interviews people in line waiting for Apple products. They still don't get it. Now they are having a big management "Crisis" meeting. Yes, Sammy, it's a crisis that the consumers with money in developed countries see you for what you are -- an unimaginative, slimy (IP theft, Benchmark cheating, court document disclosing, government official bribing, negative blogger and tweeter paying), unethical copycat. And the Japanese simply won't buy your products over that little island issue. So, say goodbye to the U.S. and Japan, the two largest economies in the world.

    As for the iPhone 6. Yes, they will get it right. This will be the last dagger in the heart of Samsung. By September of next year, even the Samsung paid shill analyst firms will have to capitulate to the massive sales of iPhones and iPad in their reports. When the 6 comes out with bigger screens (two sizes) and a new form factor and features, people across the globe will be falling all over each other to get their hands on one. By then China Mobile will be online and will probably add another 70 mm units to Apples 2014 iPhone sales. And, of course, Apple will continue to offer the 5s in the smaller size for those who prefer it. Game over.
    Dec 2 05:27 PM | 29 Likes Like |Link to Comment
  • Why Steve Jobs' Big Blunder Is Starting To Cost Apple [View article]
    Chabig,

    I couldn't agree more. And how many times to I have to read the specious comparison between AAPL and companies like Sony and Nokia. This is a new age. People are buying into complete ecosystems. Not only does AAPL have the best devices, but they also have -- BY FAR -- the best ecosystem in the world.

    Maybe the author should state that 88% of all mobile commerce is done on an ipad. Maybe he should state that 70% of all mobile search is done on AAPL devices. Maybe he should state that 70% of all smart phone profits are made by AAPL. Maybe he should state that AAPL actually gained smart phone market share in the U.S. over Samsung in the forth quarter 2012 to hit 53% of the smart phone market share (the highest ever). Maybe he should state that AAPL sold 48 million iphones last quarter to Samsung's 15 million Galaxies. Or how about the 500 million itunes accounts. Or how about the 40 billion app downloads, half of which were downloaded just last year.

    That doesn't sound like a company that's losing its grip of the market to me.
    Feb 13 09:27 PM | 29 Likes Like |Link to Comment
  • Apple lower on Barclays downgrade. Tesla's Musk confirms talks. [View news story]
    It's astonishing to me that sell-side analysts still can impact stock prices. These people have proven themselves to be unworthy of such influence time and time again. And, this guy's thesis is laughable. The iphone 6 will be the biggest product release in Apples history. And that is before a possible iwatch that some have modeled incremental revenues of 17-20 billion.
    Feb 20 10:29 AM | 21 Likes Like |Link to Comment
  • Funds Are Selling Out Of Apple: What You Need To Know [View article]
    Institutional investors are rarely ahead of the curve; which is why 85% of all actively managed funds trail the indexes. Don't get confused as to who is the tail and who is the dog. Apple will kill earnings this quarter and every quarter in fiscal 2014 and all of the ill-informed funds who have been buying the specious argument that increasing competition will erode Apples margins will be dragged back into the stock for performance and liquidity reasons. Most funds have missed the first 120 points of this rally. Fewer will miss the next 100 points and even fewer will miss the run from 600 to 700 next year.
    Oct 23 09:08 AM | 21 Likes Like |Link to Comment
  • Apple Stays Rotten [View article]
    This is a VERY myopic analysis of Apple. Hanging your hat on one metric (ROIC) and then doing "back of the napkin" analysis to justify its conclusion is not very good analysis. Beating the same drum over and over again doesn't make a weak thesis any better.

    First of all, competition isn't heating-up (the cornerstone of your ROIC thesis) -- its cooling down. Competitors are capitulating. Blackberry sent up the white flag last Friday and said they are out of the consumer business.

    Nokia was absorbed by MSFT which will be a disaster for both. Feckless MSFT missed the front-end of the smart phone industry completely and now wants to knock off Apple's "walled garden" ecosystem because no other OEM wants to make a phone running a MSFT OS. A walled garden running MSFT is MSFT's capitulation that Apples walled garden ecosystem was the right model from the beginning. It is probably true of the PC industry as well as PC sales continue to decline and the Apple controlled tablet market grows.

    As for Android OEM's, most of them don't make ANY money. So, "economic profit margins" are already at ZERO for most Android OEM's and Apples ROIC remains at 270. People still pay huge premiums for Apple products because they are the best in the world and Apple has an unrivaled ecosystem. That is not likely to change any time soon and I suspect you will begin to sound like Peter Schiff who has been calling for 5,000 an ounce gold for the last 5 years.

    The only Android OEM that makes money is Samsung and they are interviewing customers standing in line for the new iphones to try and understand why people are so excited about Apple products. They will never understand what that is and it is something that they cannot copy -- try as they will. It is also something that this author doesn't understand about Apple.

    The 5s has been met with rave reviews from critics. Walt Mossberg called the iphone 5s the best smart phone in the world by far. The camera is great. People are not buying the Lumia because its the wrong ecosystem. People associate MSFT as a loser company that was dominant in the 80's and 90's and was asleep at the wheel at the birth of the smart phone industry. Further, no one needs 41 megapixels unless they are making billboard sized photos. A complete gimmick by Nokia to try hopelessly to differential themselves in the market. It didn't work.

    The 64 bit architecture is huge. We'll see with what and when Samsung tries to do the same.

    If you don't understand the significance of the first biometric security technology coupled with ibeacons (not NFC) and 625,000,000 existing itunes customers who have already provided their credit card info and have bought 40 billion in content from itunes, well, no will be able to explain it to you.

    Here are some more meaningful numbers for you:

    71% of ALL global smart phone profits are made by Apple.
    90% of ALL global tablet profits are made by Apple.
    85% of ALL global mobile search happens on an ipad alone.
    70% of ALL global mobile commerce happens on an Apple device.
    Apple devices are 3 times more reliable than any Android phone.
    99.7% of all malicious viruses are in the Android ecosystem.
    Apple is the the second most recognized brand in the world behind Coca-Cola.

    You are right about one thing. Apple is NOT a value company.
    In 2014 Apple will grow earning by 20% and margins will expand. The market will have to capitulate and award Apple a growth multiple in 2014 of at least a market multiple. This will put Apple at all time highs in 2014.
    Sep 23 08:37 AM | 21 Likes Like |Link to Comment
  • Value Hidden In Plain Sight: Apple Is Too Cheap [View article]
    Apple is in an "expectation bubble?" Really? Apple sells at a huge discount to the S & P. If Apple were in an expectations bubble it would sell at a premium to the market, not a discount. I think Apple is in a "show me" phase were no positive expectations are discounted into the price.
    Apr 9 03:03 PM | 19 Likes Like |Link to Comment
  • Apple Bears Throw In The Towel [View article]
    Michael,

    The growth story for Apple may end someday, but that day is not even in the horizon at this point. Most of the bears thought that the growth story was over in fiscal 2013. They all said that the market was saturated and that prices and margins would have to come down for Apple as they always eventually do in tech. Well, as it turns out, fiscal 2013 was just a breather year for Apple. They had to anniversary fiscal 2012 which had atypically high and unsustainable margins. That has happened, and the growth story is back on. Apple is selling iPhones as fast as they can stamp them out. I estimate they will sell over 60 mm iPhones this quarter. China (where the bears have been saying the growth story is over for Apple) has been a smashing success for Apple this quarter. In the month of October alone Apple surged from 3% market share to 12% market share and grew from 6th place to 3rd place -- in 30 DAYS!!! On that trajectory, Apple probably overtook Samsung's market share this month and is the biggest smart phone seller in China. Tablets are flying too. 73% of all people who intend to buy a tablet will by an iPad. 73% of all new smart phone sales in Japan are iPhones and iPhones dominate the Japanese market share even more than they do in the United States. Next year comes the larger iPhone 6 and who knows what else, but there will be plenty. All the while, feckless Samsung has a PR nightmare on there hands with youtube videos about phones that catch fire and Samsung's attempts to silent the customers instead of do the right thing. Samsung just took their unit sales numbers for 2014 down by 30mm. 2014 will be the year of decline for Samsung and the year that Apple returns to strong growth.
    Dec 13 04:24 PM | 19 Likes Like |Link to Comment
  • Apple: Is It Finally Time To Buy? [View article]
    Dan,

    Even in you ridiculous scenario, I guess no value for what will be 250 billion in cash in two years. So, you would put a zero value on the AAPL's enterprise and have it selling at a 50% discount to cash, LOL. Very good work, Dan.
    Apr 1 08:47 AM | 19 Likes Like |Link to Comment
  • In a rare move for an Apple (AAPL) exec, marketing chief Phil Schiller is trashing Android (GOOG) ahead of tomorrow's Samsung Galaxy S IV event. Schiller takes aim at Android's fragmentation, noting only 16% of users (per Google's data) are on Android 4.1 (Jelly Bean), and claims (citing Apple's internal data) 4x as many smartphone users switched from Android to the iPhone in Q4 than vice versa. Is Schiller just being candid, or does Apple now think Android's rise demands a more aggressive marketing stance? [View news story]
    Tack,

    You are an ill-informed troll. First you link to an IDC article from q3 2012 which hardly has any iphone 5 sales in in. Most of the sales that IDC is counting are phones that are not even used as smart phones. In the last quarter of 2012 AAPL sold 48 million iphones to 15 million galaxy SIII's.

    Here are some "facts" for you:

    AAPL makes 72% of ALL global smart phone profits.

    AAPL makes 91% of ALL global tablet profits.

    70% of ALL mobile search is done on an AAPL device.

    88% of ALL mobile ecommerce is done on an ipad ALONE.

    iphone is 300% more reliable than the best Samsung phone per a
    recent survey of 1 million people.

    Malware is out of control on Android ballooning at a parabolic rate from 5,000 to over 55,000 in just the last 3 months of 2012. It's all over apps on Google Play.

    Google gives out Android customers personal information and location to every app developer on Google Play, and, they don't deny it.

    Stew on that a little, sport.
    Mar 13 07:56 PM | 17 Likes Like |Link to Comment
  • Apple Is On Fire [View article]
    Yes, I keep hearing this. And then people said the 5s wouldn't sell in China and it sold out in less than 24 hours selling only through China Telecom and China Unicom. Don't kid yourself, the incremental demand from a China Mobile deal will surprise even the most bullish pundits to the upside.
    Dec 5 10:06 AM | 16 Likes Like |Link to Comment
  • Icahn discloses fresh Apple purchases, makes renewed buyback call [View news story]
    I voted my several thousand shares for Icahn's proposal. Apple had 45 billion in free cash flow in 2013 and will probably have over 50 billion in free cash flow in 2014. Taking on debt against the massive war chest to retire shares that Apple would otherwise be required to pay a dividend on is very smart. Especially when they can borrow money for the same amount of interest or less than the dividend yield they are required to pay on the shares.

    Apple has more than enough for a rainy day and if they do an increased buy-back with debt, they could pay a 150B buy-back off with 3 YEARS of free cash flow, still have 150 billion in the bank, and have 1/3 less shares on the market -- thus boosting earnings by 33%. It's a no brainer at this point.
    Jan 22 12:05 PM | 15 Likes Like |Link to Comment
  • Apple Mac Worldwide Surges, Almost Takes Fifth Place [View article]
    J.M.,

    I have been doing a lot of anecdotal research on Apple for enterprise -- specifically small business. After speaking with several business owners and I.T. consultants it appears sentiment has changed dramatically to favor Apple in small business enterprise. The cost of an Apple system is actually LESS than a PC system. Apple has recently reduced hardware pricing and INCLUDED all of the software FREE. When you add the cost of subsequent Microsofts OS upgrades, Office and anti-virus software (not to mention IT consulting when PC's have problems) the cost of ownership of a PC networks is HIGHER than an Apple network. The market has now realized this and the market share numbers are starting to bear that out.
    Jan 10 09:30 AM | 15 Likes Like |Link to Comment
  • (Almost) Kudos To You, Mr. Cook [View article]
    Yes, Samsung has a huge lineup of mediocre phones running on a toy third party OS. 71% of them are running OS's that are two or more generations old because the Android ecosystem doesn't support software upgrades. Samsung convinced people that bigger is better after years of the perceived advancement in technology being smaller is better as a result of Samsung's inefficiency. Android is not written in machine language and does not speak directly to the processors. Therefore Android phones needs more processing power and larger batteries to run them than iphones. So, tell the public that somehow bigger is better and many lemmings will believe it. Marketing Genius.
    Sep 16 09:23 AM | 15 Likes Like |Link to Comment
  • Apple Could Go To $625 [View article]
    UncleSherpalot,

    That sounds like a good strategy. Sell an outstanding company that is dirt cheap and makes the lions share of all of the global profits in smart phones and tablets with a pristine balance sheet and every hedge fund whale lining up to tout the virtues of the company and then buy a company that has shrunk to 3% market share due to mismanagement and is so lost it announced last week that it is looking for a buyer. Keep following that strategy and you'll be in the Walmart Greeter Training Program soon enough.
    Aug 15 07:49 PM | 15 Likes Like |Link to Comment
  • Apple downgraded at Wells over margin concern [View news story]
    It's astonishing that these inept, feckless street analysts still can have this much impact on a stock price. Some of them are trying to manipulate stock prices for their proprietary trading desks and buy-side clients and others are just completely inept. In either case, they should be ignored by the market.
    Jan 2 09:06 AM | 14 Likes Like |Link to Comment
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800 Comments
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