First let me state I'm an apple fan and am short PUTS (for those who don't know options it means it is a bullish position - I do want the stock to go up or stay up for me to make money). I however am not long actual shares for reasons I will share.
Apple's market cap today is huge. It now requires enormous profits not just for 2015, 2016 but for the next 8 to 10 years. It has to at least sustain its current revenue and profits for that entire period. Ok let's move on.
Apple is becoming a one product company. In general this is never a good thing. All companies diversify because they know at some point that one product won't provide growth and will also contract. Even apple is desperately trying to do this. Beats, Apple Pay, etc. The problem with everything Apple does to diversify is that even businesses that throw a few billion here or there don't move the needle against iphone or the huge market cap.
I'm a Buffett follower and invest by his two sayings "be greedy when others are fearful" and "be fearful when others are greedy". With apple at an all time high and essentially a one product company I'll let you decide which end of the spectrum apple stock is at right now. That is for you to judge yourself.
Some other points. iWatch is unlikely to be the monster hit that iphone or ipad were. As yourself if you will buy one for $400 bucks. Some will. Most won't. Also won't work with 90% of the market (anything not an iphone). Another limiting factor.
Next ipad is in decline. The best analyst believes 40% in Q1 next year decline. He is tapped into supply chains, I'm sure you have read about this in the last 24 hours. iPhone 6 now must carry even more weight AND fill that gap left by falling ipad. This will offset some iphone growth in itself.
Why did iphone 5 do so well? It was a bigger screen over the 4. Why is iphone 6 doing well? It is a bigger screen over the 5. Why will iphone 7 do so well or the 6S? What will be the must have reason to upgrade vs lengthen upgrade cycle another year or two as people do now with ipads? I believe we'll see peak iphone here with the 6 series. Even if the 6S and 7 just flatline year over year and ipad still declines than apple is no longer in growth mode. They have a lot of market cap to hold up here remember.
So in conclusion you have to decide for yourself if you are invested in apple if or when you want to exit. I believe apple will do well over the next decade but that may not mean shareholders will. Apple could go to a 400B market cap and still be the largest company in the world but investors lose 35% from today's quote if this happens. Remember a 400B apple is no slouch by any means and they are still selling iphones, ipads and macs. Apple Pay is a non event though. They make 15 cents for each $100. It will be over 10 years for them to hit the required revenues to make just $1B on this.
You're wrong about AppleWatch and ApplePay -- and you overlooked AppleTV [and AppleIBM] ...
In related news, it's been reported that at least six individuals who have been shorting AAPL these past few weeks have committed suicide today." src="http://forums-files.appleinsider.com/images/smilies//lol.gif" />
One of the bears jumped off of the 67th story of a building, two jumped off of bridges into an icy river, one threw themselves under a subway car in motion, one blew their brains out with a shotgun, and the last remaining bear intentionally self infected themself with the ebola virus. Interestingly, all of the victims were found to be in possession of Android phones at the time of their deaths.
Is market cap calculated based on the number of outstanding shares? If so, what do you do about all the shares Apple bought back? If market cap is only calculated based on the number of shares in Nasdaq, then it really means nothing to Apple since Apple can't touch this money. This money is there for the transfer of stocks between gamblers. Once a company goes past their IPO, all the money in the stock market belongs to the people who bought it. Correct me if I'm wrong but this is what my father-in-law told me (retire broker of 60 years when investment actually meant investing in a company).
Market cap is the number of outstanding shares multiplied by the current per-share price. As Apple buys back shares they retire those shares typically around the time of the next earnings call. This is why the number of outstanding shares has been decreasing. So as Apple buys back shares, it reduces the market cap. But this typically drives the per-share price up to restore the previous valuation (with some elasticity).
If Apple had not been buying back shares then the record market cap would have been reached around $101 per share. Because of the buyback the shares needed to go about 12% higher to achieve the record market cap. Apple has really been buying A LOT of its own stock -- which is a great thing to do when you are so undervalued by Wall Street.
Consider that Alibaba (BABA) reported $500M in profit for the last quarter while Apple (AAPL) reported about $8B (if memory serves). Apple made 16 times as much money in that quarter. However, Alibaba market cap is sitting around $300B right now (more than twice that of Amazon who is busy reporting and forecasting losses). So Alibaba is valued at about 45% of Apple as a company and yet Apple makes many multiples what Alibaba makes in profit.
If you were able to negotiate purchasing Alibaba in whole for $300B, it would probably take you over 100 years to make that $300B back in profit (i.e.: to recover your investment and start turning pure profit). If you were able to negotiate purchasing Apple in whole for $660B. it would take you about 17 years to make that $660B back in profit (recover your investment) before turning pure profit. Think about that. If Apple continues with current profits (no growth) and continues or increases the buy-back program they could be in a position to negotiate with a few investment banks to take the most valuable company in the world private in about 15 years -- that is how much AAPL is undervalued and why Carl Icahn says the stock should be at $200 per share.
Nah, I think they're too exited that Samsung is going to take on iBeacons with their newly announced, wait for it, Proximity. https://placedge.samsung.com
As for the stock, it will fluctuate as usual, but rise all the same. Here's a toast to Apple, toasting the 'competition'.
Cheers
And don't forget Samsung Flow (a knockoff of Continuity)
Market cap is the number of outstanding shares multiplied by the current per-share price. As Apple buys back shares they retire those shares typically around the time of the next earnings call. This is why the number of outstanding shares has been decreasing. So as Apple buys back shares, it reduces the market cap. But this typically drives the per-share price up to restore the previous valuation (with some elasticity).
If Apple had not been buying back shares then the record market cap would have been reached around $101 per share. Because of the buyback the shares needed to go about 12% higher to achieve the record market cap. Apple has really been buying A LOT of its own stock -- which is a great thing to do when you are so undervalued by Wall Street.
Consider that Alibaba (BABA) reported $500M in profit for the last quarter while Apple (AAPL) reported about $8B (if memory serves). Apple made 16 times as much money in that quarter. However, Alibaba market cap is sitting around $300B right now (more than twice that of Amazon who is busy reporting and forecasting losses). So Alibaba is valued at about 45% of Apple as a company and yet Apple makes many multiples what Alibaba makes in profit.
If you were able to negotiate purchasing Alibaba in whole for $300B, it would probably take you over 100 years to make that $300B back in profit (i.e.: to recover your investment and start turning pure profit). If you were able to negotiate purchasing Apple in whole for $660B. it would take you about 17 years to make that $660B back in profit (recover your investment) before turning pure profit. Think about that. If Apple continues with current profits (no growth) and continues or increases the buy-back program they could be in a position to negotiate with a few investment banks to take the most valuable company in the world private in about 15 years -- that is how much AAPL is undervalued and why Carl Icahn says the stock should be at $200 per share.
Yes, because Apple has a quarter of its 'market capital' in cash! What company can say that.
Not really true though. 50% of the installed iphone base right now is iphone 4. that means upgrade cycles are much longer in fact. I personally even know 4 people that I've been telling them to get an iphone 5, 5S and now iphone 6. 3 finally bit the bullet and got a 6. These were 4's which means 50% of the upgrade cycle is at 4 years. I think as we go out a couple years we will see the average trend lengthen further. I even have one friend who still has his 4 and says he has no reason to upgrade. LOL. I tried to convince him but no deal. Also to correct you Ming Chi Kuo of KGI is calling for YEAR OVER YEAR drop of ipad on the order of 40%. Not quarter over quarter as you suggest. read on and trade accordingly:
1. Where did you get that 50% install base is the 4? In addition even if that's true, you actually believe all the 4's were sold 4 years ago?
2. Business insider. Haha. And do we have an accuracy gauge of his predictions?
Now this has become pathetic, to the point of, I dunno, stop being annoyed I guess.
Sammy is in a really big box of hurt ....
It can't really compete against the other Android OEMs on price and make any money ...
It can't differentiate itself by slopping non-Android features atop Google's base OS ...
It doesn't seem to realize that consumers want [useful/useable] capabilities, not features ...
It doesn't do quality ...
It needs to provide it's own OS, platform, ecosystem, developers ...
It can't afford to abandon Android (and to a lesser extent MS) ...
I don't think it can get to where it needs to go ... to avoid becoming just another Android also ran ...
Possibly, it could ditch Android for Tizen, buy developers, build it's own ecosystem ... but that could take several years, and there is no guarantee of success -- the Android and non-Android competition isn't going to stand still ...
Poor Little Orphant Sammy -- An' the Gobble-uns 'll git you ef you don't watch out!
People say Apple is becoming a one-product company... their growth will hit the ceiling someday... they are doomed.... etc.
So... who should you invest in? Is there any other mobile tech company who would be a better bet?
For years the only two companies making ANY money in mobile were Apple and Samsung.
LG finally started making money recently. (hooray?)
But the other 60 smartphone manufacturers do NOT make money. Even the mighty Samsung is shrinking in unit sales and profit.
So if not Apple... then who?
IMO, Apple is slowly transitioning to a model that will rely less on their hardware to ensure they can maintain a steady revenue stream with subscription services and incremental income via Apple Pay, which will eventually become a massive revenue source for them. After the Alibaba deal is done, we may have better focus on what China will mean for Apple growth.
Yeah, no, you’re not. We know you’re not. Your other posts prove it.
WAIT, WHAT?!
Sorry but there is a difference between being a fan of the company and its products (not necessarily every product but certain ones) and being a fan of a company's stock at a certain price or trajectory. You should separate the two for yourself as well. I've seen people lose fortunes investing in companies they LOVE. Unfortunately your love for a company is not the basis for an investment decision. It is based on long term cash flow - end of story.
IMO, Apple is slowly transitioning to a model that will rely less on their hardware to ensure they can maintain a steady revenue stream with subscription services and incremental income via Apple Pay, which will eventually become a massive revenue source for them. After the Alibaba deal is done, we may have better focus on what China will mean for Apple growth.
Apple Pay is leverage ...
The ultimate example of which will be when a payment provisioner [bank/cc] offers a reward if you make Apple Pay purchases -- and you use the reward to pay for the device [Apple Watch] used to earn the reward ...
Sorry but there is a difference between being a fan of the company and its products (not necessarily every product but certain ones) and being a fan of a company's stock at a certain price or trajectory. You should separate the two for yourself as well. I've seen people lose fortunes investing in companies they LOVE. Unfortunately your love for a company is not the basis for an investment decision. It is based on long term cash flow - end of story.
Just give it up. Nobody here is impressed with your half-assed analysis. No 'Apple-fan' would spout the nonsense you did.
"I've seen people lose fortunes investing in companies they LOVE." Yeah, right ... I don't believe you know a single person who had a 'fortune', unless it was a cookie.
I don't understand what makes people like you post such nonsense. Just stop it, and go get some help.
Just give it up. Nobody here is impressed with your half-assed analysis. No 'Apple-fan' would spout the nonsense you did.
"I've seen people lose fortunes investing in companies they LOVE." Yeah, right ... I don't believe you know a single person who had a 'fortune', unless it was a cookie.
I don't understand what makes people like you post such nonsense. Just stop it, and go get some help.
You are the type of investor so in love with a company and the stock that will soon know what it feels like to be parting with your money. Keep saying "there's no weeds". They will take your garden. Good luck. Long term cash flow my friend. Keep your eye on it.
I'll see you back here in 12 to 36 months where I predict, on record, that apple will be trading in the 70 to 85 per share range. Talk to you in that time period. In the meantime time your exit accordingly. Don't forget how rabidly wall street turned on apple September 2012. Stock went from 100 down to 55 (adjusted for the split). You think Wall Street will be in love with Apple as much as you are for the next 3 years? LOL. You obviously have not been paying attention.
Now this has become pathetic, to the point of, I dunno, stop being annoyed I guess.
And posters on the Verge are ripping on Jony Ive for complaining about copying. Considering Samsung's laptops are either Windows or Chrome, their phones are mostly Android and their watches are Android and Tizen where is the flow? Samsung is desperate for relevance. They want to be the fourth company next Apple Google and Microsoft. The problem is they don't really have an ecosystem as they don't control the underlying software. And they don't have brand cache like Apple does. They spent all this money on advertising but all it did was fire up the anti-Apple trolls on tech sites. it didn't endear anyone to the company or the brand. As we can see now people are more than happy to leave Samsung for Apple or cheaper Chinese brands. What's the stickiness with Samsung? There isn't any. Plus consumers don't really seem interested in migrating to a third mobile OS so any plans Samsung has on ditching Android and creating their own is doomed to failure.
Comments
You're wrong about AppleWatch and ApplePay -- and you overlooked AppleTV [and AppleIBM] ...
http://www.cnet.com/products/acer-aspire-r7/
@_@
Today's a good day for all Apple shareholders!
In related news, it's been reported that at least six individuals who have been shorting AAPL these past few weeks have committed suicide today.
" src="http://forums-files.appleinsider.com/images/smilies//lol.gif" />
One of the bears jumped off of the 67th story of a building, two jumped off of bridges into an icy river, one threw themselves under a subway car in motion, one blew their brains out with a shotgun, and the last remaining bear intentionally self infected themself with the ebola virus. Interestingly, all of the victims were found to be in possession of Android phones at the time of their deaths.
Yeah, no, you’re not. We know you’re not. Your other posts prove it.
WAIT, WHAT?!
OMG... It's REAL! ????
Is market cap calculated based on the number of outstanding shares? If so, what do you do about all the shares Apple bought back? If market cap is only calculated based on the number of shares in Nasdaq, then it really means nothing to Apple since Apple can't touch this money. This money is there for the transfer of stocks between gamblers. Once a company goes past their IPO, all the money in the stock market belongs to the people who bought it. Correct me if I'm wrong but this is what my father-in-law told me (retire broker of 60 years when investment actually meant investing in a company).
Market cap is the number of outstanding shares multiplied by the current per-share price. As Apple buys back shares they retire those shares typically around the time of the next earnings call. This is why the number of outstanding shares has been decreasing. So as Apple buys back shares, it reduces the market cap. But this typically drives the per-share price up to restore the previous valuation (with some elasticity).
If Apple had not been buying back shares then the record market cap would have been reached around $101 per share. Because of the buyback the shares needed to go about 12% higher to achieve the record market cap. Apple has really been buying A LOT of its own stock -- which is a great thing to do when you are so undervalued by Wall Street.
Consider that Alibaba (BABA) reported $500M in profit for the last quarter while Apple (AAPL) reported about $8B (if memory serves). Apple made 16 times as much money in that quarter. However, Alibaba market cap is sitting around $300B right now (more than twice that of Amazon who is busy reporting and forecasting losses). So Alibaba is valued at about 45% of Apple as a company and yet Apple makes many multiples what Alibaba makes in profit.
If you were able to negotiate purchasing Alibaba in whole for $300B, it would probably take you over 100 years to make that $300B back in profit (i.e.: to recover your investment and start turning pure profit). If you were able to negotiate purchasing Apple in whole for $660B. it would take you about 17 years to make that $660B back in profit (recover your investment) before turning pure profit. Think about that. If Apple continues with current profits (no growth) and continues or increases the buy-back program they could be in a position to negotiate with a few investment banks to take the most valuable company in the world private in about 15 years -- that is how much AAPL is undervalued and why Carl Icahn says the stock should be at $200 per share.
Nah, I think they're too exited that Samsung is going to take on iBeacons with their newly announced, wait for it, Proximity. https://placedge.samsung.com
As for the stock, it will fluctuate as usual, but rise all the same. Here's a toast to Apple, toasting the 'competition'.
Cheers
And don't forget Samsung Flow (a knockoff of Continuity)
http://www.engadget.com/2014/11/12/samsungs-flow-ties-devices-together-like-apples-continuity/
Now this has become pathetic, to the point of, I dunno, stop being annoyed I guess.
Except of course it doesn't.
Yes, because Apple has a quarter of its 'market capital' in cash! What company can say that.
1. Where did you get that 50% install base is the 4? In addition even if that's true, you actually believe all the 4's were sold 4 years ago?
2. Business insider. Haha. And do we have an accuracy gauge of his predictions?
Sammy is in a really big box of hurt ....
It can't really compete against the other Android OEMs on price and make any money ...
It can't differentiate itself by slopping non-Android features atop Google's base OS ...
It doesn't seem to realize that consumers want [useful/useable] capabilities, not features ...
It doesn't do quality ...
It needs to provide it's own OS, platform, ecosystem, developers ...
It can't afford to abandon Android (and to a lesser extent MS) ...
I don't think it can get to where it needs to go ... to avoid becoming just another Android also ran ...
Possibly, it could ditch Android for Tizen, buy developers, build it's own ecosystem ... but that could take several years, and there is no guarantee of success -- the Android and non-Android competition isn't going to stand still ...
Poor Little Orphant Sammy -- An' the Gobble-uns 'll git you ef you don't watch out!
People say Apple is becoming a one-product company... their growth will hit the ceiling someday... they are doomed.... etc.
So... who [I]should[/I] you invest in? Is there any other mobile tech company who would be a better bet?
For years the only two companies making ANY money in mobile were Apple and Samsung.
LG [I]finally[/I] started making money recently. (hooray?)
But the other 60 smartphone manufacturers do NOT make money. Even the mighty Samsung is shrinking in unit sales and profit.
So if not Apple... then who?
IMO, Apple is slowly transitioning to a model that will rely less on their hardware to ensure they can maintain a steady revenue stream with subscription services and incremental income via Apple Pay, which will eventually become a massive revenue source for them. After the Alibaba deal is done, we may have better focus on what China will mean for Apple growth.
Yeah, no, you’re not. We know you’re not. Your other posts prove it.
WAIT, WHAT?!
Sorry but there is a difference between being a fan of the company and its products (not necessarily every product but certain ones) and being a fan of a company's stock at a certain price or trajectory. You should separate the two for yourself as well. I've seen people lose fortunes investing in companies they LOVE. Unfortunately your love for a company is not the basis for an investment decision. It is based on long term cash flow - end of story.
Apple Pay is leverage ...
The ultimate example of which will be when a payment provisioner [bank/cc] offers a reward if you make Apple Pay purchases -- and you use the reward to pay for the device [Apple Watch] used to earn the reward ...
You had to be there!
Sorry but there is a difference between being a fan of the company and its products (not necessarily every product but certain ones) and being a fan of a company's stock at a certain price or trajectory. You should separate the two for yourself as well. I've seen people lose fortunes investing in companies they LOVE. Unfortunately your love for a company is not the basis for an investment decision. It is based on long term cash flow - end of story.
Just give it up. Nobody here is impressed with your half-assed analysis. No 'Apple-fan' would spout the nonsense you did.
"I've seen people lose fortunes investing in companies they LOVE." Yeah, right ... I don't believe you know a single person who had a 'fortune', unless it was a cookie.
I don't understand what makes people like you post such nonsense. Just stop it, and go get some help.
Just give it up. Nobody here is impressed with your half-assed analysis. No 'Apple-fan' would spout the nonsense you did.
"I've seen people lose fortunes investing in companies they LOVE." Yeah, right ... I don't believe you know a single person who had a 'fortune', unless it was a cookie.
I don't understand what makes people like you post such nonsense. Just stop it, and go get some help.
You are the type of investor so in love with a company and the stock that will soon know what it feels like to be parting with your money. Keep saying "there's no weeds". They will take your garden. Good luck. Long term cash flow my friend. Keep your eye on it.
I'll see you back here in 12 to 36 months where I predict, on record, that apple will be trading in the 70 to 85 per share range. Talk to you in that time period. In the meantime time your exit accordingly. Don't forget how rabidly wall street turned on apple September 2012. Stock went from 100 down to 55 (adjusted for the split). You think Wall Street will be in love with Apple as much as you are for the next 3 years? LOL. You obviously have not been paying attention.
And posters on the Verge are ripping on Jony Ive for complaining about copying. Considering Samsung's laptops are either Windows or Chrome, their phones are mostly Android and their watches are Android and Tizen where is the flow? Samsung is desperate for relevance. They want to be the fourth company next Apple Google and Microsoft. The problem is they don't really have an ecosystem as they don't control the underlying software. And they don't have brand cache like Apple does. They spent all this money on advertising but all it did was fire up the anti-Apple trolls on tech sites. it didn't endear anyone to the company or the brand. As we can see now people are more than happy to leave Samsung for Apple or cheaper Chinese brands. What's the stickiness with Samsung? There isn't any. Plus consumers don't really seem interested in migrating to a third mobile OS so any plans Samsung has on ditching Android and creating their own is doomed to failure.