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Russia's richest man bullish on Apple, buys $100M in shares

post #1 of 34
Thread Starter 
A Russian billionaire recently bought about $100 million in Apple stock, and has publicly declared his faith in the future of the company.

Usmanov
Billionaire Alisher Usmanov thinks Apple is a good buy at its current price. Photo via The Guardian.


Alisher Usmanov, the richest man in Russia, views the recent decline in Apple's share price as a strong investment opportunity, he said in an interview with Bloomberg. Shares of Apple are down nearly 40 percent from their high last September, just before the launch of the iPhone 5.

Apple is a "very promising investment" over the next three years, Usmanov said, though he cautioned that "nothing is eternal." He specifically cited the company's recent decision to spend $100 billion through 2015 on its capital return program.

That money will go toward a new, higher quarterly dividend of $3.05 per common share, as well as a share repurchase program that will amount to $60 billion. The plan is the largest share repurchase authorization in history.

Usmanov is known for making more than a 10-fold return on his investment in Facebook, after initially building his fortune through the tech sector in Alibaba.com and Mail.ru. He's the 35th richest man in the world, with a net worth of $19.8 billion.

With his company's market capitalization off $100 billion from its high last September, Apple Chief Executive Tim Cook said last week that the declining stock price has been "frustrating."

"But Apple remains very strong and we will continue to do what we do best," he said. "We can't control items such as exchange rates and world economies, and even certain cost pressures, but the most important objective for Apple will always be creating innovative products ??and that is directly within our control."
post #2 of 34
In Soviet Russia shares buy you.

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post #3 of 34
Apples shares can go up and down independent of the cash they bring in. The stock price is purely manipulated by the boys on Wall Street.
They make revenue markers and hopes Apple can cross THIER FINISHING LINE. And when Apple doesn't meet their BS, they drop their stock prince. LOL!
In January Apple posted the greatest quarter in Apple history; yet the stock price still went down!!!
There needs to be an investigation because the speculators are stealing money from investors and blaming it on Apple's management.
post #4 of 34
Mr. Usmanov appears to be a traditional "investor" instead of a stock market gambler. These are the type of stories that show how undervalued AAPL really is and hopefully will prop up the stock. The market needs to get rid of all those manipulators and day gamblers who have no interest in any long-term investments. Investment was the reason the market was created but it's turned into a mess of short and long gamblers and is a cesspool of corruption. Apple is an international company so I have no problem with Russian investors. The buy Apple devices just like the rest of the world.
post #5 of 34

With a 3 year timeframe, seems like a safe bet that AAPL will hit at least $600 again at some point.  With the chance of $800.  So 50%-100% gain.  Apple can't screw up that bad to tank below $400 long term.

post #6 of 34
Quote:
Originally Posted by techguy911 View Post

With a 3 year timeframe, seems like a safe bet that AAPL will hit at least $600 again at some point.  With the chance of $800.  So 50%-100% gain.  Apple can't screw up that bad to tank below $400 long term.

It has little to do with Apple screwing up. Apple is the same company as when the stock was over $700.

Further when Wallstreet is involved nothing is a safe bet. Yet, Apple will be getting a good price on its shares if the stock dips.
post #7 of 34
Quote:
Originally Posted by TBell View Post


It has little to do with Apple screwing up. Apple is the same company as when the stock was over $700.

Further when Wallstreet is involved nothing is a safe bet. Yet, Apple will be getting a good price on its shares if the stock dips.

 

But the $60,000,000,000 buyback changes things.  What wallstreet hack would be stupid enough to try to tank Apple now?  And it won't end after 2015.  I'm pretty sure Apple will be raising the divident 10-20% each year from now on and they will probably do another 3 year $60B buyback in 2015.

post #8 of 34
Playing the stock market is gambling. Apple's price is based on investor mood of the moment and previous highs and lows are irrelevant.

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post #9 of 34
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Originally Posted by sog35 View Post

But the $60,000,000,000 buyback changes things.  What wallstreet hack would be stupid enough to try to tank Apple now?  And it won't end after 2015.  I'm pretty sure Apple will be raising the divident 10-20% each year from now on and they will probably do another 3 year $60B buyback in 2015.
$60B is about 6 days trading value spread over 400 trading days. If executed well, it can mess with HFT and Day Traders, but it remains to be seen how much it can impact market dynamics.
post #10 of 34
An investor needs to keep AAPL for the long term. I did that when I bought AAPL a few years ago at a split-adjusted $2.50. Nonetheless, I did sell 20% of my AAPL holdings when it was $701. I figured that a 280-bagger meant it was time to diversify. With the dividends, AAPL covers about half of the RMD for my IRA. It looks like AAPL will continue to increase in value, considering the new and updated hardware and software designated for the next two years. Since I am not an analyst, no one will pay any attention to my prediction of a price of $600 with a year.

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post #11 of 34
Quote:
Originally Posted by aaarrrgggh View Post

Quote:
Originally Posted by sog35 View Post

But the $60,000,000,000 buyback changes things.  What wallstreet hack would be stupid enough to try to tank Apple now?  And it won't end after 2015.  I'm pretty sure Apple will be raising the divident 10-20% each year from now on and they will probably do another 3 year $60B buyback in 2015.
$60B is about 6 days trading value spread over 400 trading days. If executed well, it can mess with HFT and Day Traders, but it remains to be seen how much it can impact market dynamics.

The buyback is not trading. At todays prices, Apple is buying back more than 15% of the outstanding shares. Realistically they will end up with 10% as the price goes up. Taking that many shares off the market will probably have some impact.
post #12 of 34
This dip looks like a pretty obvious buying opportunity to me. If I had any free cash, I'd buy more, but all my free money is tied up in AAPL stock already.

I'm sure the world is going to thing this oligarch is genius for getting in at $400 a share, but those of us who have been here since it was $4 a share (split-adjusted) will say, "Welcome aboard, what took you so long?"
post #13 of 34
Quote:
Originally Posted by sog35 View Post

 

But the $60,000,000,000 buyback changes things.  What wallstreet hack would be stupid enough to try to tank Apple now?  And it won't end after 2015.  I'm pretty sure Apple will be raising the divident 10-20% each year from now on and they will probably do another 3 year $60B buyback in 2015.

 

Well, $60b seems like a lot, but up against leveraged money and divided by 3 years it's not really 'that' much.

post #14 of 34
Apple's taking up to 15% of the current Share supply off the market and giving you a higher dividend at these low prices. So less supply, undervalued stock and yearly cash dividends. Hmmm, should I invest? Over the next three years, it's a real good deal.
post #15 of 34
Quote:
Originally Posted by jd_in_sb View Post

Playing the stock market is gambling. Apple's price is based on investor mood of the moment and previous highs and lows are irrelevant.

My father always said, in the stock market when someone wins, someone else loses. I never really understood that, as simple as it may seem, until I read a book about the tech bubble.

 

300 pages later, the author basically said, the guys "in the know" (Wall Street) made all the money, and the little guys lost. That's not to say some on Wall Street didn't lose money, but the general premise is correct, I think.

post #16 of 34
Opulence, I has it.
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"Just because something is deemed the law doesn't make it just" - SolipsismX
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"I got the answer by talking in my brain and I agreed of the answer my brain got" a 7 yr old explaining his math HW
"Just because something is deemed the law doesn't make it just" - SolipsismX
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post #17 of 34
Quote:
Originally Posted by Fithian View Post

An investor needs to keep AAPL for the long term. I did that when I bought AAPL a few years ago at a split-adjusted $2.50. Nonetheless, I did sell 20% of my AAPL holdings when it was $701. I figured that a 280-bagger meant it was time to diversify. With the dividends, AAPL covers about half of the RMD for my IRA. It looks like AAPL will continue to increase in value, considering the new and updated hardware and software designated for the next two years. Since I am not an analyst, no one will pay any attention to my prediction of a price of $600 with a year.

 

Can I just say the obvious... good job. I would subscribe to your newsletter.

post #18 of 34
Quote:
Originally Posted by monstrosity View Post

 

Well, $60b seems like a lot, but up against leveraged money and divided by 3 years it's not really 'that' much.

 

 $60B is alot no matter how much leverage the hedge funds have.  The average hedge fund is only a few billions dollars.  Even if they leverage 10x they will only be able to play about 1 or 2 Bil on Apple.  And why target Apple when there are much better stocks to short?  Why target apple when they already dropped 40%?

post #19 of 34
Quote:
Originally Posted by christopher126 View Post

My father always said, in the stock market when someone wins, someone else loses. I never really understood that, as simple as it may seem, until I read a book about the tech bubble.

 

300 pages later, the author basically said, the guys "in the know" (Wall Street) made all the money, and the little guys lost. That's not to say some on Wall Street didn't lose money, but the general premise is correct, I think.

With my sincere apologies to your dad, but to say that the stock market is a zero-sum game is overly simplistic. Stocks can be sold for reasons other than "it is overvalued." For example, liquidity. A person may sell at a profit relative to when he bought it; if the stock continues to go up after that, the person that bought it also profits. 

 

The stock market has created more wealth for more people than any other human creation in history.

 

Yes, there are bubbles. But those exist in every single asset market: e.g., real estate; gold; commodities; bonds, i.e., not just in stocks. Insiders may have made money in the tech bubble (although no one held a gun to the investors' heads, so they also perhaps got what they deserved), but "Wall Street" has been far from infallible: in the real estate/structured finance bubble of 2006-08, it was WS that lost its shirt.

post #20 of 34
He's also the UK's richest man as he's smart enough not to live in Russia. 1smile.gif
post #21 of 34
LOL what he's saying is, "I know it was artificially reduced and you would be a fool not to buy it now"!!!! Makes sense 1wink.gif
post #22 of 34
Apple's buyback of 50 billion worth of their own stock is a way of shoving it in the face of the gamblers and manipulators on Wallstreet. They are simply saying if you do not want to pay a fair price for our stock, we will buy it back and keep it. These con operators are simply bad mouthing the company to push the stock price down so they caan buy it cheap when the real investors get cold feet and sell. Then another run on the stock will occur to make them aa fortune, and they begin to sell again. After their profit, they start bad mouthing the company again to push the stock down again, whereupon they will buy it low and make another fortune when it goes back up. This has happened to Apple stock three times in the last four years.

The best response is to hold the stock and now collect the dividends which is much more than you can get at a bank's savings account. Apple is doing the right thing by investing their excess cash in their own company and, by doing so, they are telling these wallstreet con artists to stick it up where the sun does not shine. Apple is the best investment there is right now. It will likely be over $600 before the end of the year. Sell some when it gets high, buy some when it gets low, and collect your dividend along the way.
post #23 of 34
Coz of believing those asshole analysts , I sold all of my AAPL at 394 to them , fxck them !!! Give my AAPL back !!!
post #24 of 34
I'm all for talking up Apple shares,but just because a shady Russian businessman buys Apple shares is hardly a reason for anyone else to follow suit.
On that basis you should buy into Arsenal Football Club as well...
post #25 of 34
Quote:
Originally Posted by crazy_mac_lover View Post

Coz of believing those asshole analysts , I sold all of my AAPL at 394 to them , fxck them !!! Give my AAPL back !!!

Yikes!  I hope you still came out ahead!

 

Never believe analysts.  I bought my AAPL when analysts rated the shares as an "Avoid."  You should have looked at Apple financial data over the long term and not just compare it to last year's. The March quarter that just finished was the second best of all time. Yes, it wasn't quite as good as 2012, but it was better than every previous year.

 

Remember, all of the people who work in the financial industry (brokers, analysts, media, etc.) make their money from transactions.  If the vast majority of investors adopted long-term buy-and-hold strategies, most of these morons would be unemployed.   They have to generate excitement for losers and tear down successful companies which cause trading by the stampeded herd.   Then, they'll turn on the overpriced loser and buck up the battered heavyweight and generate a whole new wave of trades.

post #26 of 34
Quote:
Originally Posted by rob53 View Post

Mr. Usmanov appears to be a traditional "investor" instead of a stock market gambler.

It's important to remember that this guy is already incredibly wealthy so he will invest some money for security rather than growth. Also, even small amounts of growth for him means large returns. Even if he gets 10% increase in 10 years, that's another $10m for him. For people who are investing life savings like $100k for a nicer retirement, $10k in 10 years is better than nothing but hardly something to get excited about. AAPL now is more for people who want to stay wealthy than people who want to become wealthy.

If it goes to $600, that's a decent return for people who bought at the low $400s but you can see the market cap. While it's possible for it to go above $500, that wouldn't be an accurate value given their slowed growth. $700 was the peak and there's no reason for it to go back there again.
Quote:
Originally Posted by anantksundaram 
A person may sell at a profit relative to when he bought it; if the stock continues to go up after that, the person that bought it also profits.

Someone loses somewhere in the process eventually. You can say that someone can win big at a Casino and the Casino gets record profits so everybody wins but that's just ignoring the losses. There's a limited money supply in the world, so it's all just wealth redistribution - someone wins, someone loses.
Quote:
Originally Posted by anantksundaram 
"Wall Street" has been far from infallible: in the real estate/structured finance bubble of 2006-08, it was WS that lost its shirt.

Yeah all those CEOs from bankrupt companies are now on welfare. Tragic.
post #27 of 34
Quote:
Originally Posted by Marvin View Post


It's important to remember that this guy is already incredibly wealthy so he will invest some money for security rather than growth. Also, even small amounts of growth for him means large returns. Even if he gets 10% increase in 10 years, that's another $10m for him. For people who are investing life savings like $100k for a nicer retirement, $10k in 10 years is better than nothing but hardly something to get excited about. AAPL now is more for people who want to stay wealthy than people who want to become wealthy.

If it goes to $600, that's a decent return for people who bought at the low $400s but you can see the market cap. While it's possible for it to go above $500, that wouldn't be an accurate value given their slowed growth. $700 was the peak and there's no reason for it to go back there again.
Someone loses somewhere in the process eventually. You can say that someone can win big at a Casino and the Casino gets record profits so everybody wins but that's just ignoring the losses. There's a limited money supply in the world, so it's all just wealth redistribution - someone wins, someone loses.
Yeah all those CEOs from bankrupt companies are now on welfare. Tragic.

 

No reason for apple to reach $700?  Are you kidding me.  If Apple releases new products and with 10-15% less shares on the market they could easily reach $50 EPS.  At Microsoft's PE that would be $850. 

 

Saying the market cap is too big is BS that Wall Street hacks spew out.  With a 5% buyback and 3% dividend Apple is returning 8% a year without any price appreciation.  So slow growth makes Apple a stock that deserves a PE under 6 taking out cash?  Ridiculous.  Apple's revenue grew almost 20% last quarter even without any new products.  The average PE in the S&P500 is about 17.  Are you telling me Apple's potential for growth is 50% worse than the broad market?


Edited by sog35 - 5/1/13 at 6:33am
post #28 of 34
Quote:
Originally Posted by Gary1943 View Post

Apple's buyback of 50 billion worth of their own stock is a way of shoving it in the face of the gamblers and manipulators on Wallstreet. They are simply saying if you do not want to pay a fair price for our stock, we will buy it back and keep it. 

I respectfully disagree. I see it as capitulation (but I am not sure Apple had much of a choice). This is precisely the outcome that some of the so-called manipulators wanted.

post #29 of 34
Quote:
Originally Posted by Marvin View Post


It's important to remember that this guy is already incredibly wealthy so he will invest some money for security rather than growth. 

No one got to be that rich (save for inheriting the wealth) by treating something like $AAPL as "security". If you're optimistic, this is a growth stock. If you're pessimistic, it's the Titanic. Nothing in the last tumultuous 8 months suggests it is merely a place to hold money.

post #30 of 34
He's a billionaire because he doesn't declare his faith in the company BEFORE he purchases the shares. Gotta wonder if this isn't money drawn out of Cyprus. In that country, it was the laundering of Russian mafia money that brought them down, in Greece, it was letting Goldman Sachs execs "advise" them while their buddies in the US shorted the currency. If he's this rich, chances are there are some bones buried in a fur lined walk-in closet.
post #31 of 34
Quote:
Originally Posted by stelligent View Post

I respectfully disagree. I see it as capitulation (but I am not sure Apple had much of a choice). This is precisely the outcome that some of the so-called manipulators wanted.

 

How do the "manipulators" benefit from a stock buy-back?

 

Yes, in some areas like stock-shorting, the House always wins -- but the house doesn't get to play if you take your gambling chits and go home. I think this is more the casual pessimism of a realist substituting for hard data -- I know, I do it all the time as well.

 

Apple's stock buy-back was probably due to their opinion that it was undervalued -- and it ends up helping the company when the market purchases it later for a higher value. I think they'll do well in returns in this case.
post #32 of 34
Quote:
Originally Posted by sog35 View Post

Apple's revenue grew almost 20% last quarter even without any new products.

Their profit fell though - $11.6b down to $9.5b. Let's say that one day they made 20% more revenue next year but recorded a net loss, would you value them higher or lower? Profit has to count more than revenue.
Quote:
Originally Posted by stelligent 
Nothing in the last tumultuous 8 months suggests it is merely a place to hold money.

It showed that $700 was the maximum value that the market would hold and it fell because growth slowed down. It'll fluctuate back and forth now that Apple has demonstrated stability but it shouldn't settle anywhere near $700 unless there's a massively profitable new product coming along. Obviously that value can happen, I just don't think it will happen. I reckon it will stay below $500. Right now, Apple has regained the highest market cap in the world. $850 puts it at more than double Exxon's value.
post #33 of 34
Quote:
Originally Posted by Marvin View Post


Their profit fell though - $11.6b down to $9.5b. Let's say that one day they made 20% more revenue next year but recorded a net loss, would you value them higher or lower? Profit has to count more than revenue.
It showed that $700 was the maximum value that the market would hold and it fell because growth slowed down. It'll fluctuate back and forth now that Apple has demonstrated stability but it shouldn't settle anywhere near $700 unless there's a massively profitable new product coming along. Obviously that value can happen, I just don't think it will happen. I reckon it will stay below $500. Right now, Apple has regained the highest market cap in the world. $850 puts it at more than double Exxon's value.

 

There were many reasons why profit fell.  One of the main reasons is that the large percentage of revenue was from iPhone in 2012 and that has a much higher margin.  Also there were several unusual one time charges to the plus side in 2012 and on the negative side in 2013 (warranty, R&D exp, ect).  Bottom line is the gross margin of 47% in 2012 was an anomaly. 

 

Don't forget that apple is buying back about 15% of their shares.  So the stock can go up 15% without the market cap going up at all.

 

Profits are sacrificed more revenue all the time.  Amazon and Google are two examples.  It's okay as long as there is an end game and payoff.  IMO the endgame for Apple is having the ultimate eco-system for re-occuring revenue.  In a few years phones/tablets will be maxed out.  But if Apple locks in 1,000,000,000 people in their eco-system they will be making ridiculous money.  That's where iWatch, iTV, iHome, and iCar come in.  With those new products the stickiness of the eco-system will be super glue strong.  We are talking everything from cable tv, home automation and security, to movie rentals and online banking.  Apple is already dominating mobile.  The next step is the home.

 

With that in mind how can anyone view Apple as a non-growth company?  They could easily buy Dish Network, netflix, even Amazon.  They could buy ADT, Bose, and Tesla. 

post #34 of 34
Quote:
Originally Posted by maccherry View Post

Apples shares can go up and down independent of the cash they bring in. The stock price is purely manipulated by the boys on Wall Street.
They make revenue markers and hopes Apple can cross THIER FINISHING LINE. And when Apple doesn't meet their BS, they drop their stock prince. LOL!
In January Apple posted the greatest quarter in Apple history; yet the stock price still went down!!!
There needs to be an investigation because the speculators are stealing money from investors and blaming it on Apple's management.

 

I agree with you -- but if there were actually an investigation on how stocks are manipulated to "rip off the suckers" then that would mean that the huge sums of money that created FINRA -- which is a joint venture between the OLD government regulators and Wall Street (no really -- like the Fed -- so what's the worst that can happen, right?), actually WANTED to help out John Q. Public and not of course, themselves, which is the rich people regulating the rich people. And that would mean that they'd have to admit that Stocks and Futures contracts were rip offs and a bad way to actually fund startup companies or improve existing ones -- I mean, why not allow companies just to create bonds? Anyway.

 

Long before you get justice meted out or investigations, you've got to fix a totally corrupt system. To get to that point you've got to get an election process that wasn't ruled by Lobbyists and Banks and before that you'd have to have someone in the justice department take seriously how rigged and ridiculous it is to have gerrymandered districts with 52% Republicans and next county 99% Democrats so that their guys can win on occasion. And before that, you'd have to outlaw political parties because it goes agains the concept of us electing representatives if they are going to COLLUDE with another interested party -- like the DNC or GOP or lobbyist for Exxon.

 

You might as well ask for world peace.
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