Foxconn parent Hon Hai (HNHAF.PK), which is believed to get 60%-70% of its revenue from Apple (AAPL +1.2%), reported a 19% Y/Y drop in calendar Q1 sales to $27B. KGI Securities: "A quarterly decline was expected, but not a yearly decline ... This shows that Hon Hai's revenue depends too much on Apple, and iPhone orders corrected more than expected." Nonetheless, Apple is following the tech sector higher, a possible sign a weak Q1 is priced in. [View news story]
I believe that although Apple would never admit it, they feel their corporate secrets may not be as safe in Asia as they are here. I expect the supply chain to migrate back to North America over these next 5 years and Apple certainly can make that investment and make it pay off. The Samsung iPhone was a real wake up call to them. Plus how great would it be to have more technical jobs here?
Apple Has Become The Most Underrated Stock [View article]
I have 150 shares in my IRA at $550 (and yes, it still hurts) but while I wait for it to rebound I do the following:
Trade/Options/Sell to Open and pick a chain about 5% above current price (called a 'tight call', where it's close to being in-the-money) for 2-4 weeks away. In this case, I have some April $450s and May $450s.
I collect the entire premium of selling the call. I'm up pretty nicely on both so I may close the positions (Buy to Close) before earnings come out because I don't want to miss out on any upside should AAPL surprise and the stock run to $480 that night. My stock would be 'called away' at $450. But I would keep my full premium.
Now I can sell 1 regular call and 5 mini calls for more yield! Very fun. Happy to help if you want to message me directly.
Apple Has Become The Most Underrated Stock [View article]
and for all of us longs, don't forget to keep selling calls every week or month to jolt your yield while you wait for rationality to return.
and if you're lucky enough to have shares in an IRA, you can make the calls very tight and collect fat premiums with no risk of a tax transaction if they are called away
AND, just to bring more joy, they now how 'mini options' for AAPL so even if you only own 10 shares you can sell calls against your position.
Short Armour And Long American Capital: mREIT Pair Trade [View article]
Todd - love your stuff, but why not just be long on your favorite mREITs and leave ARR alone? There is smoke starting to billow that the Fed may slow open market purchases which could mean higher rates are coming as soon as next year. This news alone could make the mREIT sector jump as spreads would increase as would book values.
I would despise paying out that $0.08 per share each month while you waited for your theory to play out. Especially if the market corrects and people flock to dividend stocks.
Facebook Home - What It Means For Apple, Google, And Microsoft [View article]
I also wonder if the future generation values FB the way we older folks do. my study of my kids and their friends (14-18) is that FB is for us 'old people' and they are all about Instagram & Twitter.
so it's not too far of a stretch for anyone (iOS or Android) to be able to choose their own "home" and while it will be more live and less static, the key will be ad revenue on that 'home'.
Peaceful coexistence between all 'homes' can work a la different cable channels that do well with different age groups.
Peter I was always taught that it's your 3rd option, meaning Book Value is the value of all assets if they had to be liquidated in a Chapter 7 bankruptcy. But remember, GM traded below BV for years!
Workday: Overvaluation And Lock-Up Expiration Will Cause Shares To Crash [View article]
not at director level but a working staff member could. Now keep in mind, those trades are the ones that the SEC always looks at. They love nailing small timers because it's so easy. If I were an employee I would not buy PUTS and make great money on it because it would be a big red flag.
i like that play but January will be here before you know it and we havent had our correction yet (maybe it's starting this week). I think doing the $35 strike prices may be a better value. But again, I like where your head's at.
Salesforce.com Has Limited Upside, Competition Rising/Margins Not Growing [View article]
if you only knew what you have stumbled upon. The amazingly consistent top line growth coupled with the wildly fluctuating Sales & Marketing line (that is growing much faster than the top line), to me, is a red flag. My bet is that the Sarbanes Oxley Act isn't being judiciously watched by management. Or more likely, they are part of it. If you read the 10-K it's filled with subjective valuations of which management approves. The same management who is highly compensated to keep the growth story going.
Salesforce.com Has Limited Upside, Competition Rising/Margins Not Growing [View article]
Agree with RonK2 - you lay out a good thesis but you are really off the mark on this conclusion. Benioff says it every quarter that they are sacrificing profit today to build and grow. I would bet a paycheck that CRM won't make GAAP profits this fiscal year.
Also, if you have time or the inclination, you'll see that almost all of their cash flow is derived from stock option transactions and that they are spending extraordinary amounts in Sales and Marketing just to achieve their top line revenue.
A "hold" may actually net a good return short term, but ultimately this stock is a house of cards and this analysis epitomizes work where analysts can't or won't dig in and ask yourselves the tough questions.
Todd you are clearly the best SA writer. You understand that length and complexity of articles doesn't necessariliy translate to great information. I tend to think exactly like you about these stocks but with much less pnash and sophistication.
Foxconn parent Hon Hai (HNHAF.PK), which is believed to get 60%-70% of its revenue from Apple (AAPL +1.2%), reported a 19% Y/Y drop in calendar Q1 sales to $27B. KGI Securities: "A quarterly decline was expected, but not a yearly decline ... This shows that Hon Hai's revenue depends too much on Apple, and iPhone orders corrected more than expected." Nonetheless, Apple is following the tech sector higher, a possible sign a weak Q1 is priced in. [View news story]
Apple Has Become The Most Underrated Stock [View article]
Trade/Options/Sell to Open and pick a chain about 5% above current price (called a 'tight call', where it's close to being in-the-money) for 2-4 weeks away. In this case, I have some April $450s and May $450s.
I collect the entire premium of selling the call. I'm up pretty nicely on both so I may close the positions (Buy to Close) before earnings come out because I don't want to miss out on any upside should AAPL surprise and the stock run to $480 that night. My stock would be 'called away' at $450. But I would keep my full premium.
Now I can sell 1 regular call and 5 mini calls for more yield! Very fun. Happy to help if you want to message me directly.
Salesforce.com Has Limited Upside, Competition Rising/Margins Not Growing [View article]
Short Armour And Long American Capital: mREIT Pair Trade [View article]
Short Armour And Long American Capital: mREIT Pair Trade [View article]
Apple Has Become The Most Underrated Stock [View article]
and if you're lucky enough to have shares in an IRA, you can make the calls very tight and collect fat premiums with no risk of a tax transaction if they are called away
AND, just to bring more joy, they now how 'mini options' for AAPL so even if you only own 10 shares you can sell calls against your position.
SO happy
Apple Has Become The Most Underrated Stock [View article]
Too Long AAPL but am holding firm to my convictions
Short Armour And Long American Capital: mREIT Pair Trade [View article]
I would despise paying out that $0.08 per share each month while you waited for your theory to play out. Especially if the market corrects and people flock to dividend stocks.
Facebook Home - What It Means For Apple, Google, And Microsoft [View article]
so it's not too far of a stretch for anyone (iOS or Android) to be able to choose their own "home" and while it will be more live and less static, the key will be ad revenue on that 'home'.
Peaceful coexistence between all 'homes' can work a la different cable channels that do well with different age groups.
Long AAPL, Long FB
An Open Letter To Bob Benmosche [View article]
Workday: Overvaluation And Lock-Up Expiration Will Cause Shares To Crash [View article]
An Open Letter To Bob Benmosche [View article]
Salesforce.com Has Limited Upside, Competition Rising/Margins Not Growing [View article]
Salesforce.com Has Limited Upside, Competition Rising/Margins Not Growing [View article]
Also, if you have time or the inclination, you'll see that almost all of their cash flow is derived from stock option transactions and that they are spending extraordinary amounts in Sales and Marketing just to achieve their top line revenue.
A "hold" may actually net a good return short term, but ultimately this stock is a house of cards and this analysis epitomizes work where analysts can't or won't dig in and ask yourselves the tough questions.
An Open Letter To Bob Benmosche [View article]
Long AIG, Long AAPL, Short CRM