Chasing Value: Apple -- two rights and one wrong

A broken clock is right two times a day!

TOOT TOOT - if you blow your horn any louder I still don't givr a crap about your non-analytic view... which is blah!

"Several of my editors and colleagues have commented about me sticking my neck out calling the bottom of the market two weeks ago and then suggesting it's time to buy the financial sector, however, I stand by this theme and this morning MBIA Inc. is lending support to the idea. "

Really do you get paid to write this crap?

HH

it came out today that apple is stoking the fires under the feet of its suppliers and pumping out phones at a rate that will produce 40 million a year

they WILL sell them. they will have use of that HUGE pile of cash for 2 years before the bean counters put it into the statements, which will save them LOTS of taxes. meantime the juggernaut adds revenue from sales made last year to every statement. the quarter to quarter sales figures show NOTHING of the companies momentum. if you broke down everything and sold it now you would have a value of about 117 dollars if apple decides that 50 or 60 billion dollars is enough walkin round money in reserve and starts buying back shares or declares a dividend you will be eating CROW by september. i hope the finger you licked and held up to the wind to come up with the 150 value is clean. i can only imagine where you usually keep it.

cute using the old logo

Apple expects growth to slow not a decrease in revenue. Apple's guidance is for $300 to $500 million increase in revenue for next quarter. but Apple always beats its guidance, so many expect a larger increase in revenue. Wall Street expected growth next quarter to be $1 to $1.5 billion more which is an outrageous number in a slow economy. The large difference between Apple's guidance and what Wall Street wanted sent the stock dropping but with little volume in after-hours, which means somebody or a small institution panicked. Apple is still growing. The biggest news is the new Mac computers, which is a good surprise and should send the stock up when the new Mac's come out. This should cause the stock to make 52 week highs.

You do get a bit of heat. I do suggest reading the HSBC statement - notice the absence of HK and remember that it used to be a crown colony. During that time it was the mainlands only outlet in the form of BOC. This is before Henry.
I shook hands with Richard. Yeah - no b.s.

Since we're making predictions I'll say Apple will be around $120 per share by the end of the year. Mostly because you're right, the Apple story is getting alittle too long in the tooth. The fan boys all love Apple, but every one else is getting tired of hearing about it. How long can they hype the "new version" of there old products. Hey we get tired of hearing the same old hype every six months. They have their loyal following, but they need more than that to keep the stock moving up. Just like HOG has the baby boomers, Apple has it's fan boys, nobody else is getting excited about Apple anymore. Sorry, fan boys, it's over.

Pat yourself on the back a little harder, Sheldon!

Give me a break; another analyst writing an article in the first person, talking about how fantastic and prophetic they are.

So basically, you were just going to sit here and wait until AAPL hit the 150-160 range (whether it be now, 6 months, or 6 years from now) and then spit this article out declaring yourself a genius.

I think I only read BS these days so I have something to laugh about instead of the comics.

The real situation here is the macro-economic forces that are driving or actually destroying the market. When the Dow hit 13K Apple was at $190. Is it the market or is it Apple? At $190 it is terribly close to $260. (Roughly 30% not a big jump) The last two quarters were nothing short of incredible and the moat around this company is so large that Robert Craig Keneval A.K.A.
Evil would want to jump it if he were still with us. The second coming of the IPhone was, once again, nothing short of incredible. Apple currently sports a P/E of 30. RIMM has a P/E of 42. How do we justify this? Apple is a fun stock but it is interesting that people who follow/own the stock are referred to as "Fanboys." This stock has incredible, how many times can I use that word in one post, fundamentals and products plus a nascent global exposure. But, let's take a glance at the crap shall we? Exploding IPods, cracks in the plastic, the supposed drop in IPod sales, (didn't happen), Options, analysts who change their opinions at a moments notice only to change them again a few moments later, Shaw Wu? Peter Oppenheimer's continual game of guiding lower, and the emergence of Steve Jobs as the Keith Richards of CEOs. No matter if he wins the Boston Marathon next year and the stock is at $400 there will always be stories about his health.

Last August Apple dropped to $117 before rising to $203 In Jan. 08. 86 points in five months and then we found out that Shaquille O' Neal could've done a better job than Stanley O'Neal and Charles Prince could've easily been replaced by the artist formally known as Prince without any deleterious effects. Hypotheticals are worthless but in the right type of market Apple would've dropped to $170 and not $115. People are supposed to be going broke but before they do they manage to make a quick detour to the Apple store. Computers are no longer luxuries. The IPhone is a real pocket P/C that takes phone calls and does about one hundred other things but still folks will complain that it doesn't cut and paste.

I still feel quite confident about $260 and I believe $200 is a mortal lock. Oppenheimer's guidance was ridiculous and someone should've taken him aside before the call and explained what low balling was going to cost the shareholders given the economic climate. If you really believe that Apple is going to sacrifice profitability and margins just to dominate the market you're crazy. Why do it? Stay small, maintain margins, and do a few buybacks to push the share price. This isn't Starbucks. Well, as Lowell George of Little Feat sang, "Time loves a hero" and Mick Jagger sang, "Time is on my side." Will time love Apple? Only time will tell.

Beltway Greg
Keef Richards for President 2008
Keef in 08 before its too late.

Greg, Bill, Mr. N, Thanks for taking the time to comment.

Greg I think you are overly optimistic and Mr. N is the opposite. The stock is fairly valued now and $200 is not a lock. The rule of large numbers by itself can be a drag on the stock. Mr. N. AAPL will be a buy long before it goes to $120 so I do not see how that is possible. I would even think $200 is more likely then $120.

For those that think I am too self inflating...

1) You have not read the original post and perhaps do not read as much as you react.

2) Any of our regular readers knows very well that no writer on bloggingstocks.com is more self critical and quick to point out his own blunders.

Peace to all

O.K. all these attacks from the closet fan boys ("TOOT TOOT, Broken clock, pat yourself on the back, LOL), only strengthens my case. I'll admit that I'm bias against the company & the stock, mostly due to their back-dating history. Maybe this bias is affecting my judgement, but we'll see what happens. I think it just can't be hyped anymore. Time will tell who's right.

Greg,

The creation of 'Fanboy' comes from the over zealous that pump their fists in the air for Apple with mindless chatter.

When Georges Yared posted Apple $300 the fist pumping, stock pumping clones were throwing out numbers like of $350, $400 and even $450!

They are not able to participate in a rational discussion.

Currently in the Denver Airport on my way back from Aspen. Don't worry my friends I have not gone Hollywood. Aspen is quite reasonable in the summer and Snowmass is a frickin' steal. Unless of course you buy gasoline for your car. I paid $5.12/gallon at the Aspen Shell on Main St. First, I'd like to apologize to the departed spirit of Evil Knievel. I incorrectly spelled his name. Secondly, you can make it up to him by visiting his website and making a offer for his tour bus. Dude, what a chick magnet that would be but of course the chicks would have to be of a certain age and would probably have to be nurses. Saw the "Outlaws" in Snowmass and I'm here to report that the three guitar army is in fighting form. Derelicts and deviants everywhere; Hunter S. Thompson would be proud. Actually made it to the Woody Creek Tavern for lunch. Now to the matter at hand.

Apple along with the market in general has some some life. Fanboys be damned I think we're going to be surprised this fall. I don't have cable at home so I ODed on CNBC. "Fast Money" has to be the worst show of its genre on cable. It should be renamed "Fad Money." Commodities are dead.
Look at the XOM chart. Oil will be $95 by Dec. Speculators and Sovereign Wealth Funds drove the bubble. Our govt. won't harass the Sovereign Wealth Finds because they prop up our banks and buy our debt. That brings me to today's topic margins. XOM has small margins but based on its volume is the most profitable company in the galaxy. If Apple can, and I believe they will, increase volume and over compensate for the loss of margins by the increased volume the profits will rise. I cannot believe that this isn't part of the corporate strategy. BTW, check out Sprint. Looks like the dumb commercials they're running for the "Instinct" just aren't cutting it.

Beltway Greg

Kiss of Death was good reading. Thanks.
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