Only way Apple can grow the iPhone would be to expand to lower end markets, which is what analyst keep saying they want Apple to do. I'm not sure if Tim Cook will go in that direction or not, but with the introduction of the Mini who knows.
Also as you said the iPad market is where Apple's future is at.
the iphone isn't on China's #1 carrier. There is plenty of growth there. What's the sense of Apple going to lower-end markets. It will lower the ASP and margins and for some reason Apple is getting killed on it with the ipad mini.
Why not go back and see how accurate each of those analysts has been with their projections for Apple over the past 10 years and then consider only those who have been making reasonably accurate predictions?
It matters because when the idiot analysts make stupid predictions, it affects the stock price, which affects their predictions, which affects their stock price, which is why you see big shifts from day to day. With any company, unless the company has issued an earnings report or the cost of some resource that the company needs has changed drastically (like a sudden increase in the price of electricity or oil), there is actually no reason whatsoever for there to be big changes in the price of any stock from day to day. Is Apple as a company worth less or more today then it was worth yesterday?
What reality in the marketplace or in Apple's cost structure would have caused Apple's stock price to fall over 20% in recent months? NONE. This is all about psychology (and frankly, I think a lot of analysts decided to short the stock and needed to see it fall). Apple's fundamentals are exactly the same as they were a few months ago when the stock was above 700. And those fundamentals are still highly favorable as compared to almost any U.S. company in the last 50 years. Apple sells in a few days at high margin what used to take a year or more and people are disappointed in their sales? Give me a freaking break. Apple has changed the rules of retail selling and now the market is punishing them for it. I saw one analyst on TV who complained that while Apple developed new markets with the iPod, iPhone and iPad, since they didn't seem to have another totally new product line ready for sale, that Apple was now just an ordinary company. It didn't seem to matter to him that Apple just reported quarterly revenue of $36.0 billion and quarterly net profit of $8.2 billion.
The only case you can make is that if we "go over the fiscal cliff" for an extended period of time and income tax rates go up for some people, Apple's sales will decline because people will be paying 2% more in taxes so they won't be able to afford another iPad, iPhone, iMac, etc. But I think that's largely a bogus argument because it's not the way that consumers behave. If you ask the average consumer how much they paid in taxes last year vs. the year before, my bet is that 90% can't tell you. I bet that 95% can't tell you the percentage that federal taxes are deducted from their paycheck.
Of course the adjustment has now undervalued the stock but that's the market. Stocks are always either over or undervalued and are never "just right."
I think you're right. I myself hold quite a bit of AAPL, and when it's going up I often pat myself on the back and reflect on how sensible the world is, how everything is in good order and how effin smart I am. But then when the price is going down, I start whining about idiot, delusional Wall Street investors and illegal stock manipulation and how unfairly the world is treating me.
The fiscalcliff? What an effing joke. The top 20%(62 million people) control 89% of America's wealth while the rest of us starve. So what ever losese occur due to this joke known as the FC is felt by the mighty rich which pockets trillions OS disposable cash each year from our already enormous GDP. Now, is the stock market rigged? Of course it is! Don't be dumb.
The iPhone is by far Apple's biggest product and if smartphones are reaching saturation point that is a concern, but the iPad still has a long way to go. Not only is there lots of room for the iPad to grow, it's still at the point, as a product, where you really notice the difference from upgrading.
I would have to agree with the assessment of the iPad, but not the iPhone. China is a huge untapped market for the iPhone and has yet to be explored. Initial results from sales there are very good, with 2M iPhone 5's sold and iPad mini's they cant keep on the shelves. If Apple can swing the deal with China mobile they will sell huge amounts of iPhone 5's. So world wide the iPhone is not saturated by any means. There is huge growth potential for it outside the US. Here in its recent quarter sales dominated at 51% of smart phone sales (US).
I would have to agree with the assessment of the iPad, but not the iPhone. China is a huge untapped market for the iPhone and has yet to be explored. Initial results from sales there are very good, with 2M iPhone 5's sold and iPad mini's they cant keep on the shelves. If Apple can swing the deal with China mobile they will sell huge amounts of iPhone 5's. So world wide the iPhone is not saturated by any means. There is huge growth potential for it outside the US. Here in its recent quarter sales dominated at 51% of smart phone sales (US).
I agree (wrt China)...but folks often forget that Apple's supply chain is still tapped out. Increase in demand does not equate to increase in supply. Seems like it'll take years for Apple to dramatically increase production of top tier iPhones (mostly due to high-level quality requirements). Apple has to find a way to produce a variety of products with variation of quality/materials so that they can fill the product pipeline with more consistency.
I still say that Apple will launch products at the lower end (like an iPhone nano) but will also look to Apple TV to leverage the halo effect...thereby "firing on all cylinders" of the supply chain AND increasing usage of its platform. Exciting times.
I've been doing quite ok lately trading a few AAPL here and there. I don't give a crap if it goes up or down anymore, as long as I can make a few pesos from it.
Screw the "fiscal cliff" and screw the incompetent politicians in Washington. I hope that we go over the cliff. The American people deserve to get what they wanted and what they voted for.
Comments
Quote:
Originally Posted by blackbook
I agree with this assessment.
Only way Apple can grow the iPhone would be to expand to lower end markets, which is what analyst keep saying they want Apple to do. I'm not sure if Tim Cook will go in that direction or not, but with the introduction of the Mini who knows.
Also as you said the iPad market is where Apple's future is at.
the iphone isn't on China's #1 carrier. There is plenty of growth there. What's the sense of Apple going to lower-end markets. It will lower the ASP and margins and for some reason Apple is getting killed on it with the ipad mini.
Quote:
Originally Posted by jragosta
Who cares what the average analyst thinks?
Why not go back and see how accurate each of those analysts has been with their projections for Apple over the past 10 years and then consider only those who have been making reasonably accurate predictions?
It matters because when the idiot analysts make stupid predictions, it affects the stock price, which affects their predictions, which affects their stock price, which is why you see big shifts from day to day. With any company, unless the company has issued an earnings report or the cost of some resource that the company needs has changed drastically (like a sudden increase in the price of electricity or oil), there is actually no reason whatsoever for there to be big changes in the price of any stock from day to day. Is Apple as a company worth less or more today then it was worth yesterday?
What reality in the marketplace or in Apple's cost structure would have caused Apple's stock price to fall over 20% in recent months? NONE. This is all about psychology (and frankly, I think a lot of analysts decided to short the stock and needed to see it fall). Apple's fundamentals are exactly the same as they were a few months ago when the stock was above 700. And those fundamentals are still highly favorable as compared to almost any U.S. company in the last 50 years. Apple sells in a few days at high margin what used to take a year or more and people are disappointed in their sales? Give me a freaking break. Apple has changed the rules of retail selling and now the market is punishing them for it. I saw one analyst on TV who complained that while Apple developed new markets with the iPod, iPhone and iPad, since they didn't seem to have another totally new product line ready for sale, that Apple was now just an ordinary company. It didn't seem to matter to him that Apple just reported quarterly revenue of $36.0 billion and quarterly net profit of $8.2 billion.
The only case you can make is that if we "go over the fiscal cliff" for an extended period of time and income tax rates go up for some people, Apple's sales will decline because people will be paying 2% more in taxes so they won't be able to afford another iPad, iPhone, iMac, etc. But I think that's largely a bogus argument because it's not the way that consumers behave. If you ask the average consumer how much they paid in taxes last year vs. the year before, my bet is that 90% can't tell you. I bet that 95% can't tell you the percentage that federal taxes are deducted from their paycheck.
Quote:
Originally Posted by blackbook
Of course the adjustment has now undervalued the stock but that's the market. Stocks are always either over or undervalued and are never "just right."
I think you're right. I myself hold quite a bit of AAPL, and when it's going up I often pat myself on the back and reflect on how sensible the world is, how everything is in good order and how effin smart I am. But then when the price is going down, I start whining about idiot, delusional Wall Street investors and illegal stock manipulation and how unfairly the world is treating me.
You don't think I have emotional issues, do you?
Now, is the stock market rigged? Of course it is! Don't be dumb.
Quote:
Originally Posted by ascii
The iPhone is by far Apple's biggest product and if smartphones are reaching saturation point that is a concern, but the iPad still has a long way to go. Not only is there lots of room for the iPad to grow, it's still at the point, as a product, where you really notice the difference from upgrading.
I would have to agree with the assessment of the iPad, but not the iPhone. China is a huge untapped market for the iPhone and has yet to be explored. Initial results from sales there are very good, with 2M iPhone 5's sold and iPad mini's they cant keep on the shelves. If Apple can swing the deal with China mobile they will sell huge amounts of iPhone 5's. So world wide the iPhone is not saturated by any means. There is huge growth potential for it outside the US. Here in its recent quarter sales dominated at 51% of smart phone sales (US).
Quote:
Originally Posted by Mechanic
I would have to agree with the assessment of the iPad, but not the iPhone. China is a huge untapped market for the iPhone and has yet to be explored. Initial results from sales there are very good, with 2M iPhone 5's sold and iPad mini's they cant keep on the shelves. If Apple can swing the deal with China mobile they will sell huge amounts of iPhone 5's. So world wide the iPhone is not saturated by any means. There is huge growth potential for it outside the US. Here in its recent quarter sales dominated at 51% of smart phone sales (US).
I agree (wrt China)...but folks often forget that Apple's supply chain is still tapped out. Increase in demand does not equate to increase in supply. Seems like it'll take years for Apple to dramatically increase production of top tier iPhones (mostly due to high-level quality requirements). Apple has to find a way to produce a variety of products with variation of quality/materials so that they can fill the product pipeline with more consistency.
I still say that Apple will launch products at the lower end (like an iPhone nano) but will also look to Apple TV to leverage the halo effect...thereby "firing on all cylinders" of the supply chain AND increasing usage of its platform. Exciting times.
I've been doing quite ok lately trading a few AAPL here and there.
Screw the "fiscal cliff" and screw the incompetent politicians in Washington. I hope that we go over the cliff. The American people deserve to get what they wanted and what they voted for.