That's because the only reason the stock is as high as it is before such news reports is that expectations are high. If expectations were low, then Apple could beat them and rise. But it would rise from a low level.
Example: high expectations, stock is at 700, disappoints some people and falls to 650.
Scenario 2: low expectations, stock is at 600, surprises everyone, rises to 650.
Same earnings, same end result, different path.
Amateur, immature investors cry about how unfair it all is, but they just don't understand how the world works.
I'm completely aware of all that, I just think it's stupid and another of the many failings of human beings.
That's hilarious. Insult other members here and then report members for referencing your insults. Ah, humor.
Nope. Because I didn't call you an idiot and the person who did wasn't being sarcastic.
I find it very interesting that when I click "report a post", the result of that goes to someone posting on the thread, participating in the insults that are being reported. Regardless of the merit of the complaint and the back and forth, surely I'm not the only one who objects to a thread participant also being it's judge and jury.
I didn't call Sumergo an idiot. I reserve that for others. On this thread politicians. Usually I just call you a dummy, because I don't think you have the sophistication for anything more. Your lack of knowledge is more like that of a child who has never been instructed.
He asked a legit question and I answered it extensively. I will even allow you, the moderator/flamer to read it and learn from it, though I suspect you won't.
Edit: click here to see an Apple chart for the last 5 years. Draw a straight line from Jan 2009 to today. Does that help what happened in the last year make more sense? Bubble, popped, now back to trend growth.
Cameronj: thanks for the civil answer. Although I'm an amateur investor, I got into AAPL low, and expect (someday) to sell high. Who knows when, and at what price, that might be. Wherever Apple stocks go over the next year, I'm still interested in hearing comments about why the stock fluctuates so wildly. Is this just "random market forces" that apply to all successful companies? Just asking.
Cameronj: thanks for the civil answer. Although I'm an amateur investor, I got into AAPL low, and expect (someday) to sell high. Who knows when, and at what price, that might be. Wherever Apple stocks go over the next year, I'm still interested in hearing comments about why the stock fluctuates so wildly. Is this just "random market forces" that apply to all successful companies? Just asking.
No, it's not random, it's the result of millions of investors hearing news every day and trying to assimilate it. A stock that is so highly valued has "baked in" a lot of very high expectations. Even after falling as much as it has, it's still by 25% the most valuable company in America. That implies that a lot of people still expect a lot of growth.
Every day, when news hits, those millions of investors have to make a decision about whether to buy or sell. Even if the news is great... say Apple's Mac growth was 6% instead of a 6% decline, right? So say 90% of holders of Apple stock expected worse, and 10% expected better. But if those 90% who expected worse (and thus are pleasantly surprised) already own a lot of Apple (which they probably do, because of the huge run-up) might not be up for buying even MORE. Meanwhile, those 10% who were disappointed in the number are apt to sell. So even news that impressed 90% of investors and disappoints 10% can cause the stock to drop. If those 90% are just holding, and 10% are looking to unload some... well that means nobody is buying but many are selling!
Same thing happens with earnings. Just because the "consensus" estimate is, say $10 EPS, understand that that means that somewhere around half expected more, and the rest expected less. So when earnings hit and they're $11, that doesn't mean that there will be more buyers the next day than sellers.
The market is a weighing machine. Despite what under-educated amateur investors might tell you, there's nothing that any individual can do to move a stock like Apple. All facts about Apple are so widely disseminated so quickly that the only thing that moves the stock are masses and masses of people buying or selling every day.
If an analyst comes out and says "sell" Apple, but there isn't good reason for millions of people to think he's right, then millions of OTHER people will quickly step in and buy the shares that those other millions are trying to sell. In the long run, the value of the stock will reflect the underlying fundamentals of the company, fluctuating around that fair value as a result of overblown good and bad news in the short term. The whiners complain about the unfair drop over the past 6 months, but they neglect to thank the universe for the unfair rise that happened the 12 months before that. To them, it's like it is for a 5 year old. Give a 5 year old a lolly, and then take it away, and he starts crying. Do the same to an adult and they SHOULD understand that they are left just as they were 5 minutes ago.
that's a reason to sell! sell! sell! sell! sell! I predict Apple's qtrly results will not be record-breaking enough.
What does Apple have to hit in order to be GROUND BREAKING? If they have higher earnings per share than the 2011 December quarter, wouldn't that be a positive sign? And what are you basing your prediction on? Personally, the sales are definitely carrying over to this quarter.
I just stopped by an Apple Store and that place was PACKED and this is on a Friday afternoon. Most of the people were adults and i saw a LOT of laptops being purchased and set up and a few Windows people brought their computers in to be transferred. But it was actually packed with customers just as much as a Saturday. But i saw a LOT of people buying actual computers AND tablets AND smartphone AND iMacs. It was a mad house. At least, this is what I saw at one Apple Store. Sometimes I think Apple might want to double the store size at some of their locations.
that's a reason to sell! sell! sell! sell! sell! I predict Apple's qtrly results will not be record-breaking enough.
I'd be willing to have a gentleman's bet that Apple will have higher net profits per share than they did for the 2011 December quarter. Which would be RECORD BREAKING. If Apple sold more like 50 Million iPhone 5's, wouldn't that be a LOT more in revenue than last Dec quarter for which they sold around 38 Million units.
I think Apple should be doing at least $52 Billion dollars for Dec 2012 vs. about $48 Billion for Gross Revenue, which would be another record. I think Apple had guidance on $52 Billion for the quarter, but I haven't heard anything that it was going to be lower than that. So, they might blow those numbers out. But I'll stick to at least $52 BIllion in Revenue.
I think the iMac sales are going to be low just because they took a while before starting to ship, so most of the iMac sales will be for THIS quarter than last quarter when they were announced.
Apple has been making announcements, but the actually bulk of that product's sales typically come in the quarter following, which is why they announced the iPhone/iPods in the Sept quarter because those are Dec products. The iMacs and Mac mini and 13 inch MBPR were Dec announcements for next quarter in terms of the bulk of the sales for those products.
That's because the only reason the stock is as high as it is before such news reports is that expectations are high. If expectations were low, then Apple could beat them and rise. But it would rise from a low level.
Example: high expectations, stock is at 700, disappoints some people and falls to 650.
Scenario 2: low expectations, stock is at 600, surprises everyone, rises to 650.
Same earnings, same end result, different path.
Amateur, immature investors cry about how unfair it all is, but they just don't understand how the world works.
Even some of the analysts haven't a clue. They act like the iPhone sky is falling because Apple sold less than 10 Million iPhone 5's in the Sept quarter, even though they easily forget that the product wasn't released until the last 10 days in only a small portion of their total market and that they couldn't keep up with the initial demand for well over a couple of months. I think overall, Apple will see at least a 30% increase in fiscal 2013 from 2012 and even more if/when they open up China Mobile and a line of actual TV sets. I think the stock is priced well and I don't see it going down below a P/E ratio of much less than 12. That's about the bottom in terms of P/E for Apple.
I find it very interesting that when I click "report a post", the result of that goes to someone posting on the thread, participating in the insults that are being reported. Regardless of the merit of the complaint and the back and forth, surely I'm not the only one who objects to a thread participant also being it's judge and jury.
He could have someone else moderate threads where he's entrenched in the discussion.
You're too good a writer to squander the value of the rest of your posts anyway, so it just doesn't benefit anyone to hurl insults given that they were largely unprovoked.
The insults are from past transgressions, not this current thread (obviously). He's earned every one of them. There was no reprimand, nor was there one deserved.
I mean really - he called the other poster an idiot and I hit the "report this post" link, and the report went to HIM. You are REALLY going to defend that fact?
You may enjoy the less cultish conversational tone at CultOfMac, 9to5Mac, MacRumors, Ars Technica, or any of the other sites with a less obvious advertising strategy.
"Less cultish" = "anti-Apple trolls allowed to run wild, unchecked, unchallenged, unbanned, making for a worthless discussion".
This is somehow categorically worse than pro-Apple trolls allowed to run wild, unchecked, unchallenged, unbanned, making for a worthless discussion?
At least at other sites all views are given equal consideration, allowed to stand on their own merit regardless whether they follow the marketing mantras of any particular brand.
You're replying to one of those pro-apple trolls, so don't expect him to agree with you. And don't expect, apparently, to be able to get any help from a moderator since it's a moderator who does much of the trolling.
Seriously though. Why isn't such a continually successful company as Apple seen by the markets as a "buy, buy, buy" with steadily rising stock value?
Why IS the stock so volatile when it seems such a good investment?
There's other factors that affect stock price like the market in general. Election year 2012 (November) was crucial as it laid out the plans for the next 4 years. Many investors were in flux to see who the next president would be. If you look at every stock in the history of mankind there are ups and downs. Apple happened to have their peak in the $700's and are now at the bottom of the peak (around $500). If you draw a line through the curve, there's nothing out of the ordinary at their current price.
I think the lack of Steve Jobs has some people on edge. He was their leader and visionary and many of us remember what happened to Apple the last time he wasn't there (it wasn't pretty).
I got in at $508 and I'm holding on. I would buy more if I had the money. AAPL is without question a good investment but many people only look at the charts and trends and do not look at the company, their ideals, business practices, or products. By the time AAPL announces their quarterly earnings in a few weeks their cash reserves should be around $130B. They are a bank with a technology company attached to it.
$130B is an insane amount of cash. If their board went completely brain dead for ideas, they could simply use the cash to snatch up other profitable tech companies and add them to their portfolio. They wouldn't even have to come out with anymore breakthrough products, although they probably will. I see very little risk or downside investing in AAPL.
my buddy's mother makes $88 every hour on the internet. She has been out of work for 8 months but last month her income was $20667 just working on the internet for a few hours. Go to this web site and read more www.Great70.c0m
Seriously though. Why isn't such a continually successful company as Apple seen by the markets as a "buy, buy, buy" with steadily rising stock value?
Why IS the stock so volatile when it seems such a good investment?
Stock prices are based on various valuation formulas. For instance, the overall value of the company (ie. market cap) based on revenue, sales, cash flows, and profits. Of course, the overall value also factors in an 'exit' scenario, in other words how the long-term investor will be able to realize value without simply selling to the next investor (so, share buybacks and dividends).
If every stock price merely went up when the company does well, and goes down when it doesn't, investing would be easy, but not only that, markets wouldn't function. Markets are a pricing mechanism, that always take into account the 'exit' strategy. This is why mega cap stocks always have relatively poor valuations compared to mid cap or smaller big cap companies.
You can't look at present performance of any firm to determine value, you need to look at the company's potential for growth, how it's currently being valued, and a slew of other factors.
Apple's current volatility is related to the fact that a whole bunch of people who already have bought it are selling for profit, and a bunch of others are buying it in anticipation of possible good earnings results. It does seem that the selling pressure is larger than the buying support, for now.
Comments
Originally Posted by cameronj
post
That's hilarious. Insult other members here and then report members for referencing your insults. Ah, humor.
Originally Posted by Sumergo
Well thanks for the "idiot comment" TS, I presume (hope) you left out the /sarcasm tag on purpose.
Nope. Because I didn't call you an idiot and the person who did wasn't being sarcastic.
Quote:
Originally Posted by cameronj
That's because the only reason the stock is as high as it is before such news reports is that expectations are high. If expectations were low, then Apple could beat them and rise. But it would rise from a low level.
Example: high expectations, stock is at 700, disappoints some people and falls to 650.
Scenario 2: low expectations, stock is at 600, surprises everyone, rises to 650.
Same earnings, same end result, different path.
Amateur, immature investors cry about how unfair it all is, but they just don't understand how the world works.
I'm completely aware of all that, I just think it's stupid and another of the many failings of human beings.
Quote:
Originally Posted by Tallest Skil
That's hilarious. Insult other members here and then report members for referencing your insults. Ah, humor.
Nope. Because I didn't call you an idiot and the person who did wasn't being sarcastic.
I find it very interesting that when I click "report a post", the result of that goes to someone posting on the thread, participating in the insults that are being reported. Regardless of the merit of the complaint and the back and forth, surely I'm not the only one who objects to a thread participant also being it's judge and jury.
I didn't call Sumergo an idiot. I reserve that for others. On this thread politicians. Usually I just call you a dummy, because I don't think you have the sophistication for anything more. Your lack of knowledge is more like that of a child who has never been instructed.
He asked a legit question and I answered it extensively. I will even allow you, the moderator/flamer to read it and learn from it, though I suspect you won't.
Edit: click here to see an Apple chart for the last 5 years. Draw a straight line from Jan 2009 to today. Does that help what happened in the last year make more sense? Bubble, popped, now back to trend growth.
Cameronj: thanks for the civil answer. Although I'm an amateur investor, I got into AAPL low, and expect (someday) to sell high. Who knows when, and at what price, that might be. Wherever Apple stocks go over the next year, I'm still interested in hearing comments about why the stock fluctuates so wildly. Is this just "random market forces" that apply to all successful companies? Just asking.
Quote:
Originally Posted by Sumergo
Cameronj: thanks for the civil answer. Although I'm an amateur investor, I got into AAPL low, and expect (someday) to sell high. Who knows when, and at what price, that might be. Wherever Apple stocks go over the next year, I'm still interested in hearing comments about why the stock fluctuates so wildly. Is this just "random market forces" that apply to all successful companies? Just asking.
No, it's not random, it's the result of millions of investors hearing news every day and trying to assimilate it. A stock that is so highly valued has "baked in" a lot of very high expectations. Even after falling as much as it has, it's still by 25% the most valuable company in America. That implies that a lot of people still expect a lot of growth.
Every day, when news hits, those millions of investors have to make a decision about whether to buy or sell. Even if the news is great... say Apple's Mac growth was 6% instead of a 6% decline, right? So say 90% of holders of Apple stock expected worse, and 10% expected better. But if those 90% who expected worse (and thus are pleasantly surprised) already own a lot of Apple (which they probably do, because of the huge run-up) might not be up for buying even MORE. Meanwhile, those 10% who were disappointed in the number are apt to sell. So even news that impressed 90% of investors and disappoints 10% can cause the stock to drop. If those 90% are just holding, and 10% are looking to unload some... well that means nobody is buying but many are selling!
Same thing happens with earnings. Just because the "consensus" estimate is, say $10 EPS, understand that that means that somewhere around half expected more, and the rest expected less. So when earnings hit and they're $11, that doesn't mean that there will be more buyers the next day than sellers.
The market is a weighing machine. Despite what under-educated amateur investors might tell you, there's nothing that any individual can do to move a stock like Apple. All facts about Apple are so widely disseminated so quickly that the only thing that moves the stock are masses and masses of people buying or selling every day.
If an analyst comes out and says "sell" Apple, but there isn't good reason for millions of people to think he's right, then millions of OTHER people will quickly step in and buy the shares that those other millions are trying to sell. In the long run, the value of the stock will reflect the underlying fundamentals of the company, fluctuating around that fair value as a result of overblown good and bad news in the short term. The whiners complain about the unfair drop over the past 6 months, but they neglect to thank the universe for the unfair rise that happened the 12 months before that. To them, it's like it is for a 5 year old. Give a 5 year old a lolly, and then take it away, and he starts crying. Do the same to an adult and they SHOULD understand that they are left just as they were 5 minutes ago.
Quote:
Originally Posted by jungmark
that's a reason to sell! sell! sell! sell! sell! I predict Apple's qtrly results will not be record-breaking enough.
What does Apple have to hit in order to be GROUND BREAKING? If they have higher earnings per share than the 2011 December quarter, wouldn't that be a positive sign? And what are you basing your prediction on? Personally, the sales are definitely carrying over to this quarter.
I just stopped by an Apple Store and that place was PACKED and this is on a Friday afternoon. Most of the people were adults and i saw a LOT of laptops being purchased and set up and a few Windows people brought their computers in to be transferred. But it was actually packed with customers just as much as a Saturday. But i saw a LOT of people buying actual computers AND tablets AND smartphone AND iMacs. It was a mad house. At least, this is what I saw at one Apple Store. Sometimes I think Apple might want to double the store size at some of their locations.
Quote:
Originally Posted by jungmark
that's a reason to sell! sell! sell! sell! sell! I predict Apple's qtrly results will not be record-breaking enough.
I'd be willing to have a gentleman's bet that Apple will have higher net profits per share than they did for the 2011 December quarter. Which would be RECORD BREAKING. If Apple sold more like 50 Million iPhone 5's, wouldn't that be a LOT more in revenue than last Dec quarter for which they sold around 38 Million units.
I think Apple should be doing at least $52 Billion dollars for Dec 2012 vs. about $48 Billion for Gross Revenue, which would be another record. I think Apple had guidance on $52 Billion for the quarter, but I haven't heard anything that it was going to be lower than that. So, they might blow those numbers out. But I'll stick to at least $52 BIllion in Revenue.
I think the iMac sales are going to be low just because they took a while before starting to ship, so most of the iMac sales will be for THIS quarter than last quarter when they were announced.
Apple has been making announcements, but the actually bulk of that product's sales typically come in the quarter following, which is why they announced the iPhone/iPods in the Sept quarter because those are Dec products. The iMacs and Mac mini and 13 inch MBPR were Dec announcements for next quarter in terms of the bulk of the sales for those products.
Quote:
Originally Posted by cameronj
That's because the only reason the stock is as high as it is before such news reports is that expectations are high. If expectations were low, then Apple could beat them and rise. But it would rise from a low level.
Example: high expectations, stock is at 700, disappoints some people and falls to 650.
Scenario 2: low expectations, stock is at 600, surprises everyone, rises to 650.
Same earnings, same end result, different path.
Amateur, immature investors cry about how unfair it all is, but they just don't understand how the world works.
Even some of the analysts haven't a clue. They act like the iPhone sky is falling because Apple sold less than 10 Million iPhone 5's in the Sept quarter, even though they easily forget that the product wasn't released until the last 10 days in only a small portion of their total market and that they couldn't keep up with the initial demand for well over a couple of months. I think overall, Apple will see at least a 30% increase in fiscal 2013 from 2012 and even more if/when they open up China Mobile and a line of actual TV sets. I think the stock is priced well and I don't see it going down below a P/E ratio of much less than 12. That's about the bottom in terms of P/E for Apple.
deleted
Quote:
Originally Posted by cameronj
I find it very interesting that when I click "report a post", the result of that goes to someone posting on the thread, participating in the insults that are being reported. Regardless of the merit of the complaint and the back and forth, surely I'm not the only one who objects to a thread participant also being it's judge and jury.
He could have someone else moderate threads where he's entrenched in the discussion.
deleted
Quote:
Originally Posted by MacRulez
You're too good a writer to squander the value of the rest of your posts anyway, so it just doesn't benefit anyone to hurl insults given that they were largely unprovoked.
The insults are from past transgressions, not this current thread (obviously). He's earned every one of them. There was no reprimand, nor was there one deserved.
I mean really - he called the other poster an idiot and I hit the "report this post" link, and the report went to HIM. You are REALLY going to defend that fact?
deleted
Originally Posted by MacRulez
You may enjoy the less cultish conversational tone at CultOfMac, 9to5Mac, MacRumors, Ars Technica, or any of the other sites with a less obvious advertising strategy.
"Less cultish" = "anti-Apple trolls allowed to run wild, unchecked, unchallenged, unbanned, making for a worthless discussion".
deleted
Quote:
Originally Posted by MacRulez
This is somehow categorically worse than pro-Apple trolls allowed to run wild, unchecked, unchallenged, unbanned, making for a worthless discussion?
At least at other sites all views are given equal consideration, allowed to stand on their own merit regardless whether they follow the marketing mantras of any particular brand.
You're replying to one of those pro-apple trolls, so don't expect him to agree with you. And don't expect, apparently, to be able to get any help from a moderator since it's a moderator who does much of the trolling.
deleted
Quote:
Originally Posted by Sumergo
Seriously though. Why isn't such a continually successful company as Apple seen by the markets as a "buy, buy, buy" with steadily rising stock value?
Why IS the stock so volatile when it seems such a good investment?
There's other factors that affect stock price like the market in general. Election year 2012 (November) was crucial as it laid out the plans for the next 4 years. Many investors were in flux to see who the next president would be. If you look at every stock in the history of mankind there are ups and downs. Apple happened to have their peak in the $700's and are now at the bottom of the peak (around $500). If you draw a line through the curve, there's nothing out of the ordinary at their current price.
I think the lack of Steve Jobs has some people on edge. He was their leader and visionary and many of us remember what happened to Apple the last time he wasn't there (it wasn't pretty).
I got in at $508 and I'm holding on. I would buy more if I had the money. AAPL is without question a good investment but many people only look at the charts and trends and do not look at the company, their ideals, business practices, or products. By the time AAPL announces their quarterly earnings in a few weeks their cash reserves should be around $130B. They are a bank with a technology company attached to it.
$130B is an insane amount of cash. If their board went completely brain dead for ideas, they could simply use the cash to snatch up other profitable tech companies and add them to their portfolio. They wouldn't even have to come out with anymore breakthrough products, although they probably will. I see very little risk or downside investing in AAPL.
my buddy's mother makes $88 every hour on the internet. She has been out of work for 8 months but last month her income was $20667 just working on the internet for a few hours. Go to this web site and read more www.Great70.c0m
Quote:
Originally Posted by Sumergo
Seriously though. Why isn't such a continually successful company as Apple seen by the markets as a "buy, buy, buy" with steadily rising stock value?
Why IS the stock so volatile when it seems such a good investment?
Stock prices are based on various valuation formulas. For instance, the overall value of the company (ie. market cap) based on revenue, sales, cash flows, and profits. Of course, the overall value also factors in an 'exit' scenario, in other words how the long-term investor will be able to realize value without simply selling to the next investor (so, share buybacks and dividends).
If every stock price merely went up when the company does well, and goes down when it doesn't, investing would be easy, but not only that, markets wouldn't function. Markets are a pricing mechanism, that always take into account the 'exit' strategy. This is why mega cap stocks always have relatively poor valuations compared to mid cap or smaller big cap companies.
You can't look at present performance of any firm to determine value, you need to look at the company's potential for growth, how it's currently being valued, and a slew of other factors.
Apple's current volatility is related to the fact that a whole bunch of people who already have bought it are selling for profit, and a bunch of others are buying it in anticipation of possible good earnings results. It does seem that the selling pressure is larger than the buying support, for now.