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Shares of Apple hit $100 as Morgan Stanley provides strong endorsement to investors

post #1 of 73
Thread Starter 
Apple is on the verge of a major new iPhone product cycle, but this one will be unlike any other launch before it, making it an ideal time for investors to buy in to the company's stock, Morgan Stanley said on Tuesday, helping shares to touch $100 in mid-day trading.




Analyst Katy Huberty issued a strong recommendation for shares of AAPL in a new note to investors, a copy of which was provided to AppleInsider. In it she gave a list of reasons why she believes this fall's product cycle refresh will be "different" from years past for investors.

For starters, Huberty believes shares of Apple are set to grow with currently low institutional ownership rates. She noted that the top 100 institutional holders of AAPL shares have a 2.3 percent stake in their portfolios, much lower than the 4.5 percent share the company held at its peak position in 2012.

Apple's current institutional ownership is also well below the S&P 500's rating of 3.4 percent.




She also believes that the market should pay more attention to the leadership and product investments that Apple has made in recent years, brining on key new personnel and putting huge sums of cash into research and development, along with acquisitions.

Specifically, Apple's spending on manufacturing and parts is at the company's highest level since 2007, prior to the launch of the first-generation iPhone. For the June quarter, Apple's commitments for third-party manufacturing and components grew 22 percent sequentially to $15.4 billion.




Huberty also expects the "iPhone 6" launch window to have more favorable margins than the debut of the iPhone 5 carried for Apple in 2012. In particular, she expects that the anticipated "iWatch" will post strong margins, which would stand in contrast to the margin erosion that Apple saw in 2012 with the debut of the first iPad mini.

The analyst also noted that Apple's online services, particularly the App Store, are improving overall margins and represent a greater portion of the company's revenue. And warranty expenses as a percent of revenue are declining year over year -- another trend she predicts will continue.




And Huberty has high hopes for this year's product launches, predicting that the "iWatch" in particular could see up to 60 million shipments in its first year alone. Her "base case" prediction calls for Apple to ship 41 million "iWatch" units, while she also believes that larger form factors for the "iPhone 6" will help drive year over year sales growth.

Though Huberty pushed a strongly for investors to own Apple stock on Tuesday, her price target of $110 remains unchanged from when she initially updated it in mid-July. She has also maintained her "overweight" rating.
post #2 of 73

At 11.56AM EDT, 8/19/14



 


Edited by anantksundaram - 8/19/14 at 10:11am
post #3 of 73
Manipulation FTW

"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
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"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
Reply
post #4 of 73
Quote:
Originally Posted by anantksundaram View Post
 

At 11.56AM, 8/19/14

 

No, no, no... 12:14 a.m. 08/20/2014 :-)

Where are we on the curve? We'll know once it goes asymptotic!
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Where are we on the curve? We'll know once it goes asymptotic!
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post #5 of 73

Next stop, $60.

"If the young are not initiated into the village, they will burn it down just to feel its warmth."
- African proverb
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"If the young are not initiated into the village, they will burn it down just to feel its warmth."
- African proverb
Reply
post #6 of 73
Getting close to $600B market cap. What was the highest Microsoft got to back in the day?
post #7 of 73

I've been buying more shares these last few weeks and days! Easy money!

 

Keep it coming!

post #8 of 73

Wow, the fund ownership looks really low right now.

 

Imagine how much higher AAPL can go when funds start buying up again.

post #9 of 73

The funny part is that all of my profits will probably go right back into Apple, because I am definitely going to be snapping up a few new Apple products next month, when they release a whole bunch of goodies.

post #10 of 73
Quote:
Originally Posted by Rogifan View Post

Getting close to $600B market cap. What was the highest Microsoft got to back in the day?


"The previous historical record for top market cap belonged to Microsoft, whose market value topped out at $616.3 billion in December 1999"

post #11 of 73

Getting close to the Apple all time high, adjusted for the split, at $100.72!

post #12 of 73
So instead of Apple stock has been negative since it's high, the story will be Apple stock has no change in two years.

Hey where are the users that said Apple wouldn't hit 700 (100) again?
post #13 of 73
Quote:
Originally Posted by Rogifan View Post

Getting close to $600B market cap. What was the highest Microsoft got to back in the day?

 

Bill Gates didn't do drugs.

"If the young are not initiated into the village, they will burn it down just to feel its warmth."
- African proverb
Reply
"If the young are not initiated into the village, they will burn it down just to feel its warmth."
- African proverb
Reply
post #14 of 73
Quote:
Originally Posted by Benjamin Frost View Post
 

Bill Gates didn't do drugs.

 

He should've. He's much too square.

 

Windows is atrocious. They definitely need to do drugs and get more creative.

 

I am glad that Steve Jobs did some drugs every now and then.

post #15 of 73
Quote:
Originally Posted by jungmark View Post

So instead of Apple stock has been negative since it's high, the story will be Apple stock has no change in two years.

Hey where are the users that said Apple wouldn't hit 700 (100) again?

 

Busy covering their shorts; I believe that's the expression.

"If the young are not initiated into the village, they will burn it down just to feel its warmth."
- African proverb
Reply
"If the young are not initiated into the village, they will burn it down just to feel its warmth."
- African proverb
Reply
post #16 of 73
Quote:
Originally Posted by Apple ][ View Post
 
Quote:
Originally Posted by Benjamin Frost View Post
 

Bill Gates didn't do drugs.

 

He should've. He's much too square.

 

Windows is atrocious. They definitely need to do drugs and get more creative.

 

I am glad that Steve Jobs did some drugs every now and then.

 

That's a criticism that you should be aiming at Blackberry with their new Passport.

"If the young are not initiated into the village, they will burn it down just to feel its warmth."
- African proverb
Reply
"If the young are not initiated into the village, they will burn it down just to feel its warmth."
- African proverb
Reply
post #17 of 73
Quote:
Originally Posted by Benjamin Frost View Post
 

That's a criticism that you should be aiming at Blackberry with their new Passport.

 

I've written this before on this forum, but I sometimes visit Crackberry when I need to laugh at other people, and those people are just totally delusional.

 

Some of them actually think that the Passport is going to be a hit. What's going on at Crackberry is delusional people who live in their own reality, a sick reality.

post #18 of 73
Quote:
Originally Posted by Benjamin Frost View Post

Next stop, $60.

They still have to do a huge buyback before the end of the year, which might push it up if it hasn't already been factored into the current value. That's part of the problem though, nobody knows what information traders have already used to reach the current price. People tend to make assessments based on the current price as though that's an accurate starting point.

People say oh look it's $100 now but just wait until the buyback and the iPhone 6 as though nobody else knows about those things. What typically happens is there's an adjustment after those events as they've already been anticipated and after they are done, there's nothing after that to justify traders increasing the price.

The current price is not based on the present or past but is already based on what people expect from Apple in the future.
post #19 of 73
What has apple changed when aapl was at $400 ? Stock market is full of lies.
post #20 of 73
Quote:
Originally Posted by Apple ][ View Post
 

 

I've written this before on this forum, but I sometimes visit Crackberry when I need to laugh at other people, and those people are just totally delusional.

 

Some of them actually think that the Passport is going to be a hit. What's going on at Crackberry is the same thing that is taking place in Ferguson, delusional people who live in their own reality, a sick reality.

 

I guess that could be argued about either side.  (Not Apple vs Blackberry, obviously).  I don't have a 'side' on the Ferguson issue.  I'll only say that if it were me, I couldn't stay out all night looting and burning buildings down.  I have a little thing called a job that I go to 5-6 days per week.  Gets in the way of my protesting.

 

post #21 of 73
Quote:
Originally Posted by Apple ][ View Post

Wow, the fund ownership looks really low right now.

Imagine how much higher AAPL can go when funds start buying up again.

The biggest players I believe understand that the propped-up economy is still on shaky ground and they are holding onto their cash in the event there is another massive 2008-level crash.

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

Reply
post #22 of 73
Quote:
Originally Posted by Marvin View Post

What typically happens is there's an adjustment after those events as they've already been anticipated and after they are done, there's nothing after that to justify traders increasing the price.
 

 

There's often a small sell off, buy the rumor, sell the news type of scenario, but that's just a minor, temporary thing, and I believe that AAPL will only continue to rise, because after the event, massive sale numbers will eventually be released, and that will drive the stock up, in anticipation of yet another record earnings.

post #23 of 73
Quote:
Originally Posted by OriginalG View Post


"The previous historical record for top market cap belonged to Microsoft, whose market value topped out at
$616.3 billion
in December 1999"

That doesn't make sense. Apple has about 10% less (equivalent) shares than it did when it hit its previous ATH. It's got about 6 billion shares now, so figure about 6.5 billion. at $100/share, that would make its market cap then $650 billion or thereabouts. Of course, we aren't taking inflation into account....
post #24 of 73
Quote:
Originally Posted by SpamSandwich View Post

The biggest players I believe understand that the propped-up economy is still on shaky ground and they are holding onto their cash in the event there is another massive 2008-level crash.

 

I'm not one of those crazy conspiracy theorists and pessimists who constantly preach doom and gloom, but I too believe that what goes up must come down, and the bull market has been going on for many years now.

 

I don't have 100% of my cash in the market either, but when the next crash comes, I will be ready, and I will be entering with all of my reserves.

post #25 of 73
Quote:
Originally Posted by Benjamin Frost View Post

Next stop, $60.
After another 7/1 split?
post #26 of 73
Quote:
Originally Posted by crazy_mac_lover View Post

What has apple changed when aapl was at $400 ? Stock market is full of lies.

 

To the uneducated.

 

What has changed?

 

Apple has increased the dividend by 24%

Apple has increased their buyback to 90,000,000,000

 

When the stock was sub $400 EPS growth was NEGATIVE 10%

Now EPS growth is at POSITIVE 15-20%

 

People need to learn to INVEST instead of always blaming Wall Street.

Use your BRAIN people and LEARN.

Instead of blaming Wall STreet for the tech crash in 2000 learn PE ratios, EPS, Balance Sheets, CAsh flows, ect.  Anyone with half a brain could see those .com stocks were scams.  Check your greed at the front door.  Learn to INVEST not GAMBLE.  Learn to manage risk.  Learn to take profits and stop being GREEDY. 

Instead of blaming WAll STreet for the great recession learn to take ADVANTAGE of low prices.  If you bough the S&P500 in Jan2009 when it crash at 800 you would have made 150% today.

 

Learn to take advantage of Wall STreets manipulations and greed.  That's why I bought Apple stock at $500, $475, $450, and $400.  Take advantage of manipulations instead of crying tears.  In the long run companies that make PROFITS will appreciate.


Edited by sog35 - 8/19/14 at 10:08am
post #27 of 73
Quote:
Originally Posted by CustomTB View Post
 
Quote:
Originally Posted by Benjamin Frost View Post

Next stop, $60.
After another 7/1 split?

 

I was sarcastically referencing the pre-split drop to $385 from $700. $60 would be roughly the equivalent.

"If the young are not initiated into the village, they will burn it down just to feel its warmth."
- African proverb
Reply
"If the young are not initiated into the village, they will burn it down just to feel its warmth."
- African proverb
Reply
post #28 of 73
Huberty has a respectable track record and makes a good case for an 'outperform' rating
One thing huberty left out is 'Apple Loyalty' which will create demand
post #29 of 73
Quote:
Originally Posted by sog35 View Post

To the uneducated.

What has changed?

Apple has increased the dividend by 24%
Apple has increased their buyback to 90,000,000,000

When the stock was sub $400 EPS growth was NEGATIVE 10%
Now EPS growth is at POSITIVE 15-20%

People need to learn to INVEST instead of always blaming Wall Street.
Use your BRAIN people and LEARN.
Instead of blaming Wall STreet for the tech crash in 2000 learn PE ratios, EPS, Balance Sheets, CAsh flows, ect.
Instead of blaming WAll STreet for the great recession learn to take ADVANTAGE of low prices.  If you bough the S&P500 in Jan2009 when it crash at 800 you would have made 150% today.

Learn to take advantage of Wall STreets manipulations and greed.  That's why I bought Apple stock at $500, $475, $450, and $400.  Take advantage of manipulations instead of crying tears.  In the long run companies that make PROFITS will appreciate.
All of this can be calculated when Aapl is at $500 . I don't think Apple has true growth . The true reason is the big investors cheated enough shares from small investors . So AAPL rises.
post #30 of 73
Quote:
Originally Posted by BUSHMAN4 View Post

Huberty has a respectable track record and makes a good case for an 'outperform' rating
One thing huberty left out is 'Apple Loyalty' which will create demand

Until relatively recently she's had an abysmal track record. Look up her history with Phillip Elmer DeWitt, who keeps track of Apple analyst performance. I think Shaw Wu no longer covers Apple. He was terrible.

Proud AAPL stock owner.

 

GOA

Reply

Proud AAPL stock owner.

 

GOA

Reply
post #31 of 73
Quote:
Originally Posted by crazy_mac_lover View Post
 The true reason is the big investors cheated enough shares from small investors . 

 

How did small investors get cheated?

 

Nobody forces anybody to sell any stock.

 

There is a lot of panic selling that takes place sometimes, but those people are morons, in my humble opinion.

post #32 of 73
Quote:
Originally Posted by Marvin View Post


They still have to do a huge buyback before the end of the year, which might push it up if it hasn't already been factored into the current value. That's part of the problem though, nobody knows what information traders have already used to reach the current price. People tend to make assessments based on the current price as though that's an accurate starting point.

People say oh look it's $100 now but just wait until the buyback and the iPhone 6 as though nobody else knows about those things. What typically happens is there's an adjustment after those events as they've already been anticipated and after they are done, there's nothing after that to justify traders increasing the price.

The current price is not based on the present or past but is already based on what people expect from Apple in the future.

 

If you are doing it right you value the stock at the present value of future cash flows.

 

If you are using a different formula you are bound to lose money.

post #33 of 73
Quote:
Originally Posted by Apple ][ View Post
 

 

How did small investors get cheated?

 

Nobody forces anybody to sell any stock.

 

There is a lot of panic selling that takes place sometimes, but those people are morons, in my humble opinion.

 

Correct.

 

Small investors need to get SMARTER and BUY when the stock tanked.

post #34 of 73
Quote:
Originally Posted by crazy_mac_lover View Post


All of this can be calculated when Aapl is at $500 . I don't think Apple has true growth . The true reason is the big investors cheated enough shares from small investors . So AAPL rises.

 

You are wrong.

 

EPS profit growth was negative when the stock was $500

 

You need to get an education on investing.

 

Below is a chart that shows the direction relationship between Stock price and earnings growth.

 

post #35 of 73
Quote:
Originally Posted by Sacto Joe View Post


That doesn't make sense. Apple has about 10% less (equivalent) shares than it did when it hit its previous ATH. It's got about 6 billion shares now, so figure about 6.5 billion. at $100/share, that would make its market cap then $650 billion or thereabouts. Of course, we aren't taking inflation into account....

 

Except that the current share price takes into account how many shares are available to be traded. (hence, "total market cap" isn't really affected by how many shares are available.) 

Your inflation point is a good one though.

From out there on the moon, international politics look so petty. You want to grab a politician by the scruff of the neck and drag him a quarter of a million miles out and say, "Look at that!" -...
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From out there on the moon, international politics look so petty. You want to grab a politician by the scruff of the neck and drag him a quarter of a million miles out and say, "Look at that!" -...
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post #36 of 73
Where's Constable Odo? Has he apologized yet for his thousands of ranting posts demanding Cook's head and claiming the stock had nowhere to go but down, when it was @ $400, if Cook stayed?

No, of course he hasn't. On the internet, you never have to take back, or be held accountable for anything. Just bash away, then when proven wrong, pretend like nothing happened.

The stock is now higher than its been in Apple's history. Inevitably, it will take a dive at some point again. Thats how these things work. But that doesn't mean we need to start shrieking for heads to roll and management change, or for Apple to abandon their values and philosophies in a fruitless way to up the stock. Its a meaningless metric that has little to do with performance and everything to do with a few people making alot of money. Apple will be fine as long as they hold on to the values which has made them great, and so far, theyve done just that.
post #37 of 73
Quote:
Originally Posted by Apple ][ View Post
 

 

I'm not one of those crazy conspiracy theorists and pessimists who constantly preach doom and gloom, but I too believe that what goes up must come down, and the bull market has been going on for many years now.

 

I don't have 100% of my cash in the market either, but when the next crash comes, I will be ready, and I will be entering with all of my reserves.

 

We've been in a massive Bull Market for almost 6 years.

 

The S&P500 has gone up 150% Since Jan 2009

The NASDAQ is up 150% Since Jan 2009

 

I agree we are due for a correction.  I think it will be 10-20% drop in the next 12 months.

 

I've already sold half of my Mutual Funds and rolled them into cash.

I also sold alot of my Apple shares because of this.  I'm still holding 200 shares of Apple.

If we see a correction all boats will drop including Platinum companies like Apple.  When that happens I will load up the truck with Apple shares again as long as the fundamentals are still strong.

post #38 of 73
Quote:
Originally Posted by Slurpy View Post

Where's Constable Odo? Has he apologized yet for his thousands of ranting posts demanding Cook's head and claiming the stock had nowhere to go but down, when it was @ $400, if Cook stayed?

No, of course he hasn't. On the internet, you never have to take back, or be held accountable for anything. Just bash away, then when proven wrong, pretend like nothing happened.

The stock is now higher than its been in Apple's history. Inevitably, it will take a dive at some point again. Thats how these things work. But that doesn't mean we need to start shrieking for heads to roll and management change, or for Apple to abandon their values and philosophies in a fruitless way to up the stock. Its a meaningless metric that has little to do with performance and everything to do with a few people making alot of money. Apple will be fine as long as they hold on to the values which has made them great, and so far, theyve done just that.

 

We all know who was right and who was wrong.

 

Tim Cook. Winning.

 

Constapated Odo. Losing.

post #39 of 73
If original's Microsoft number is correct, then Apple actually has the highest all time market cap at $668B in September of 2012. See: http://seekingalpha.com/article/2405845-apples-eps-and-all-time-high-are-higher-than-you-think
post #40 of 73
Quote:
Originally Posted by sog35 View Post

If you are doing it right you value the stock at the present value of future cash flows.

The future cashflows of course being entirely unknown, making present valuations highly speculative. Not to mention the lack of correlation between the earnings amounts and the valuation amounts.
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