Apple: Complete Reset Of Expectations Could Mark The Bottom [View article]
Apple's stock now comes with a put and a call. The put is the share buy-back and the dividend, effectively eliminating any further huge downside moves, and the call is the possibility they will actually come out with some great new products that revive double digit growth in EPS. I bought in the premarket this morning at $395 and last week I sold $400 Jan 2015 puts at $82. I think in this casino called the stock market, I made a couple of very good bets.
Is Apple Moving Toward Safe Haven Status Within A Long-Term Trading Range? [View article]
If I had to guess what is wrong with Apple right now, I'd say they're caught in an innovation holding pattern waiting for some key pieces of the puzzle to fall into place.
Piece #1 is the IGZO screens they've invested billions in with Sharp that promise to be brighter, higher resolution, lower battery drain and lower production cost.
Piece #2 is the 22nm chips they've designed to be built by Taiwan Semi on Apple purchased equipment (billions more invested by Apple) that promise to be much smaller, more powerful, use less power, and will cost Apple less than the Samsung produced chips Apple is currently using.
Piece #3 is the new Qualcomm all-band LTE 4G chip that will allow Apple to make one version of the iPhone that will work on all 4G networks in the World, including China Mobile.
These new technologies will make possible not only breathtaking new products, but lower Apple's manufacturing cost so they can compete with Samsung in any market, whether its price or quality driven.
Is Apple Moving Toward Safe Haven Status Within A Long-Term Trading Range? [View article]
It is clear Apple needs the following things to happen as quickly as possible: Raise the dividend and buy back, or make a major acquisition. Come out with a phone for China Mobile and a deal to sell it Get their venture with Sharp producing new technology screens Get their venture with Taiwan Semi producing new chips Make a cheaper iPhone for the prepaid markets Make a large screen iPhone for those users who want that Come out with a new product, iTV or iWatch, whatever
The next few months are going to be painful. This quarter will be a major YOY EPS drop and the markets are going to play that up as the beginning of the end for Apple. I think, if they do all of the above, they can get the shares back up to over $600, maybe even $700 by year end. But, everything will have to go right, and very little seems to be going right lately for Tim Cook and company.
Meanwhile I'm holding my considerable shares hoping they get their act together before I can't stand the pain any longer and sell despite knowing all of the above will happen eventually.
Apple: Buy The Steak - Hold For The Coming Sizzles! [View article]
Google Glass will end after the first 100 or so accidental deaths from wearing the stupid things while driving or walking in the city. Think what it would be like to walk or drive with a cell phone in front of one eye. Who thinks this is a great idea?
Apple Investors Continue To Face Significant Downside Exposure [View article]
Little math problem here - enterprise value is $292 billion, not $392. Only $100 billion - easy mistake to make.
If Apple never comes out with a new product, just updates, refines, improves, widens price points and models of it's current products, it's still going to grow EPS in low double digits for the next 5 years. This is not a Palm or Blackberry situation. You have 500 million iTunes users and rising every day and growth in areas of the world where Apple products are revered.
Apple (AAPL) is likely to more than double its dividend this year, says Morgan Stanley's Katy Huberty after talking to CFO Peter Oppenheimer. Corporate Finance 101: She suggests the company can get around the issue of cash held overseas by funding payouts with low-interest debt rather than repatriation. Shares +0.7% premarket. [View news story]
Double would be 4.6% at this share price. It might be possible to borrow outside the US and pay back with foreign funds and avoid the tax of repatriation. I would prefer a stock buy back funded the same way. They may do a bit of both.
Apple Needs A Staggering Breakthrough, And Quickly [View article]
With the guidance they gave, and the tough compare with last year's FQ2 results (which was a blow-away), I'd say it will be a miracle if results this quarter are positive. Last FQ2 the moon and stars aligned perfectly, this year, not the case - no overstuffed Chinese channel, no new iPad launch, no 40 new countries launching in the quarter, no unmet demand to speak of, except iPad mini and iMac desktops. I'm thinking $10.00 to $11.00. Last year was $12.30.
The good news is the next two quarters will be much easier to beat.
Apple Needs A Staggering Breakthrough, And Quickly [View article]
The stock is suffering from investors who see a negative EPS YOY comp this quarter, which is going to be painful (as in a $2 loss in trailing EPS) and no upside catalysts in the near term. Without management throwing investors some red meat, like a dividend increase, elevated & accelerated stock buy-back, an announced deal with China Mobile and/or NTT Docomo, strong evidence an Apple TV is coming sooner rather than later, a low-cost iPhone for the prepaid market, a phablet device, an iwatch, a juicy acquisition, like NetFlix, or a combination of many of the above, the stock is likely to continue riding that channel down to $400.
I cannot believe they (Tim Cook et al) are totally insensitive to the pain stockholders are going through right now. I can't believe some relief is not going to be forthcoming. That said, I'm holding the stock along with 2015 leaps and am short 2014 puts in the belief there will be some breakthrough products coming in the next 6-18 months. I see a new screen technology (IGZO) and a new 22nm chip design that will put Apple well out ahead of the competition again. I see a payment system, fingerprint identification, and loads of incremental improvements.
One thing I see, that seems to be ignored by the analysts, is Apple lowering it's manufacturing costs by investing billions in plant and equipment to bring these new (and far superior) technologies into mass production. Samsung, because of its vertical integration, has become the low cost producer in smartphones. Apple is skating to where the puck will be and is aiming to be the low cost producer of these new technologies and retake the cost advantage away from Samsung within 12-24 months. That's what I expect to happen and that's when the stock will reach new highs. Until then it would be nice to see some stock price support actions from management.
Most new Apple stores are expected to open outside the US, so will probably not have the same wage pressures seen here - every country is different. But, I would expect the store payroll in a China store to be a lower percentage of sales than a US store.
Apple Will Need To Acquire A Baseband Vendor [View article]
The tea leaves lead my to believe Apple is headed towards a tighter integration with QCOM. QCOM investing in Sharp display technology. TSM looking to build a new latest generation chip plant in the US for multiple end users with talk of both Apple and QCOM as potential clients. Looks to me like Apple is wanting to build a SOC with all the major components integrated into the one chip - screen controller, baseband, CPU, etc.
They need to leap past Samsung with a more powerful, cheaper, smaller, less battery hungry SOC for mobile devices. This SOC technology will enable IGZO screens at extreme brightness, high pixel density, combined with low cost and low battery usage.
The cost advantages will swing to Apple and Apple will be able to make significantly better products for less cost than their competition, then it's game over.
The Numbers Say: Expect An iPhone Blowout [View article]
Since the iPhone 5 was launched 10 days prior to the end of the prior quarter, it would be safe to say, if the iPhone had been introduced at the beginning of the, quarter Verizon sales would have been at least 1, maybe 2 million higher. This would have resulted in Verizon iPhone sales in the last quarter being maybe 7.5 million. At 11% of worldwide sales, that would result in nearly 70 million units.
Assuming that there are powerful forces that have pushed down the price of Apple recently to under $500 and, at one point, a P/E of under 11...... What would best serve these people? All the weak hands have been stripped of their shares by now. I think the next move to produce maximum profit is up, and the trigger will be earnings Weds afternoon.
There's a lot of history with this stock of powerful sell-offs followed by strong runs to new highs. Option expiration Friday was a logical pivot point.
Earnings For Apple? Put Your Money Where Your Mouth Is! My $32,000 Gambit! [View instapost]
14 week quarters are only once roughly every 6 years. 52 weeks = 4 quarters of 13 weeks each = 364 days. Since that leaves an extra day every year, and 2 extra days every leap year, Apple adjusts with a 14 week quarter every 5 or 6 years. That extra week is always going to be in FQ1 so it ends on Dec 31, like last year. This quarter will be 13 weeks.
A Remarkably Safe Way To Play The Apple Earnings Announcement [View article]
If you have a long bias - meaning you believe Apple is more likely to finish the week higher - just sell puts. A $500 put with Jan 25th expiration is selling for almost $1800. If you get the stock put to you, you own it at a little over $482 a share, which is a great price to own it at, in my opinion. Cash or Margin required is probably between $10,000 and $20,000 depending on your broker so the 4 day return on this bet is between 9% & 18%. Not bad when the worst that can happen is you buy a stock you like anyway, at a discount.
Apple (AAPL) has cut iPhone 5 component orders for calendar Q1 due to weaker-than-expected demand, sources tell the WSJ; display orders are said to be cut by ~50%. The Nikkeialso claims display orders have been halved, albeit from an elevated level of 65M. The articles back up analyst reports of iPhone production and component order cuts, and raise the question of whether Apple needs a cheaper iPhone and/or one with a larger display to bolster its international share. Suppliers on watch: LPL, CRUS, OVTI, QCOM, BRCM, SWKS, TQNT, AVGO. [View news story]
65 million per quarter is 260 million iPhone 5's a year. Add in iPhone 4& 4s's and you're up to well over 300 million iPhones a year. Now, who believes that's even remotely possible?
I think they ordered enough parts for 65 million iPhone 5's last quarter and probably sold 45 million, which combined with 4’s and 4s's is a nice 55-60 million total. Now they have parts for 20 million and reduced the 65 million this quarter to 32 million. Still enough parts to make another 45 million 5's with parts left over.
Apple: Complete Reset Of Expectations Could Mark The Bottom [View article]
Is Apple Moving Toward Safe Haven Status Within A Long-Term Trading Range? [View article]
Piece #1 is the IGZO screens they've invested billions in with Sharp that promise to be brighter, higher resolution, lower battery drain and lower production cost.
Piece #2 is the 22nm chips they've designed to be built by Taiwan Semi on Apple purchased equipment (billions more invested by Apple) that promise to be much smaller, more powerful, use less power, and will cost Apple less than the Samsung produced chips Apple is currently using.
Piece #3 is the new Qualcomm all-band LTE 4G chip that will allow Apple to make one version of the iPhone that will work on all 4G networks in the World, including China Mobile.
These new technologies will make possible not only breathtaking new products, but lower Apple's manufacturing cost so they can compete with Samsung in any market, whether its price or quality driven.
Is Apple Moving Toward Safe Haven Status Within A Long-Term Trading Range? [View article]
Raise the dividend and buy back, or make a major acquisition.
Come out with a phone for China Mobile and a deal to sell it
Get their venture with Sharp producing new technology screens
Get their venture with Taiwan Semi producing new chips
Make a cheaper iPhone for the prepaid markets
Make a large screen iPhone for those users who want that
Come out with a new product, iTV or iWatch, whatever
The next few months are going to be painful. This quarter will be a major YOY EPS drop and the markets are going to play that up as the beginning of the end for Apple. I think, if they do all of the above, they can get the shares back up to over $600, maybe even $700 by year end. But, everything will have to go right, and very little seems to be going right lately for Tim Cook and company.
Meanwhile I'm holding my considerable shares hoping they get their act together before I can't stand the pain any longer and sell despite knowing all of the above will happen eventually.
Apple: Buy The Steak - Hold For The Coming Sizzles! [View article]
Apple Investors Continue To Face Significant Downside Exposure [View article]
If Apple never comes out with a new product, just updates, refines, improves, widens price points and models of it's current products, it's still going to grow EPS in low double digits for the next 5 years. This is not a Palm or Blackberry situation. You have 500 million iTunes users and rising every day and growth in areas of the world where Apple products are revered.
Apple (AAPL) is likely to more than double its dividend this year, says Morgan Stanley's Katy Huberty after talking to CFO Peter Oppenheimer. Corporate Finance 101: She suggests the company can get around the issue of cash held overseas by funding payouts with low-interest debt rather than repatriation. Shares +0.7% premarket. [View news story]
Apple Needs A Staggering Breakthrough, And Quickly [View article]
The good news is the next two quarters will be much easier to beat.
Apple Needs A Staggering Breakthrough, And Quickly [View article]
I cannot believe they (Tim Cook et al) are totally insensitive to the pain stockholders are going through right now. I can't believe some relief is not going to be forthcoming. That said, I'm holding the stock along with 2015 leaps and am short 2014 puts in the belief there will be some breakthrough products coming in the next 6-18 months. I see a new screen technology (IGZO) and a new 22nm chip design that will put Apple well out ahead of the competition again. I see a payment system, fingerprint identification, and loads of incremental improvements.
One thing I see, that seems to be ignored by the analysts, is Apple lowering it's manufacturing costs by investing billions in plant and equipment to bring these new (and far superior) technologies into mass production. Samsung, because of its vertical integration, has become the low cost producer in smartphones. Apple is skating to where the puck will be and is aiming to be the low cost producer of these new technologies and retake the cost advantage away from Samsung within 12-24 months. That's what I expect to happen and that's when the stock will reach new highs. Until then it would be nice to see some stock price support actions from management.
Apple's Retail Headache [View article]
Apple Will Need To Acquire A Baseband Vendor [View article]
They need to leap past Samsung with a more powerful, cheaper, smaller, less battery hungry SOC for mobile devices. This SOC technology will enable IGZO screens at extreme brightness, high pixel density, combined with low cost and low battery usage.
The cost advantages will swing to Apple and Apple will be able to make significantly better products for less cost than their competition, then it's game over.
The Numbers Say: Expect An iPhone Blowout [View article]
Apple Blossoms In The Spring [View article]
There's a lot of history with this stock of powerful sell-offs followed by strong runs to new highs. Option expiration Friday was a logical pivot point.
Earnings For Apple? Put Your Money Where Your Mouth Is! My $32,000 Gambit! [View instapost]
A Remarkably Safe Way To Play The Apple Earnings Announcement [View article]
Apple (AAPL) has cut iPhone 5 component orders for calendar Q1 due to weaker-than-expected demand, sources tell the WSJ; display orders are said to be cut by ~50%. The Nikkei also claims display orders have been halved, albeit from an elevated level of 65M. The articles back up analyst reports of iPhone production and component order cuts, and raise the question of whether Apple needs a cheaper iPhone and/or one with a larger display to bolster its international share. Suppliers on watch: LPL, CRUS, OVTI, QCOM, BRCM, SWKS, TQNT, AVGO. [View news story]
I think they ordered enough parts for 65 million iPhone 5's last quarter and probably sold 45 million, which combined with 4’s and 4s's is a nice 55-60 million total. Now they have parts for 20 million and reduced the 65 million this quarter to 32 million. Still enough parts to make another 45 million 5's with parts left over.