Wall Street investors with AAPL are like skittish little mice. The slightest turbulence, noise, perception, rumor, or hint of something negative sends them running for cover. Oh, Eddie Cue didn't repaint his house curb number this year like he always does -- must mean Apple is sinking so I need to sell! A friend of my 3rd cousin's wife's dogsitters brother is having trouble with his Apple TV so that must mean iPhones sales are tumbling...
The Chinese economy is in trouble and weighing heavily on the market coupled with the first Fed rate hike in years.
The entire market is a bear market. At this point, it doesn't really matter what is going on internally at Apple, the market is going to react negatively regardless.
Samsung's warnings show even greater weakness in the Android market. And China's weakness means that Huawei and Xiaomi are in trouble also.
Apple is still in the best position and it will become evident going forward.
The problem is China needs to let their stock market crash with no intervention. Then equilibrium can be found at levels that make sense for investors. Intervention causes more panic.
I don't get criticism on Tim Cook or Apple. He explained very often that investors shouldn't focus on supply chain. Someone is starting a fire and every analyst copies the story. Why not listen to the statements in the conference call? It's good Apple doesn't respond to every rumor circling around. Let's wait and see what the January conference call brings. Apple can do no good ever. Just focus on the facts instead of emotions.
I agree. Herd mentality, China woes, iPhone cycle, all contribute to AAPL's decline. But in 2015 Apple produced its lousiest products in recent history. The 1" fatter Apple TV, the boring do nothing Apple Watch, buggy OS X and iOS releases, Beats, Music... C'mon Apple (and Jony Ive) get your eye back on the ball already. Resting on your laurels doesn't work!
Its herd mentality. No point in speculating. We'll know when Apple reports in a few weeks. But your comment about iPhone 7 just shows how pathetic this is. We've heard next to nothing about iPhone 7, certainly not anything that would point to it being some major change from the 6. So what exactly would the resurgence in the stock be for? If we're to believe these rumors and Apple is cutting orders for the 6S why should we believe people are going to rush out and buy the 7 or that we won't be talking about the same damn thing a year from now with analysts predicting 7 cuts but telling everyone things will get better with the 8.
I don't think a new iPhone 7 will make a lick of difference. I believe there's a fundamental sea change in the smart phone market. The days of premium $700 phones are numbered and not a 'smart' buy. People are happy to get by with decent $300 phones that do 90% of what an iPhone does. Only your hard core Apple enthusiast will ooh and ahh and make the latest design, a must have upgrade.
The sky is not falling, but when the iPhone makes up 70% of Apple's revenues, you have to wonder how hard and fast Apple stock can crash.
Nah. It's just another panic piled on top of rumors. Time to choose whether one panics or profits from the plunge.
This is what I see the next few months: stock could go as low as $80 by Spring because of decline of iPhone units in March. But I see the stock resurging on news of the iPhone7 release and big gains in AppleWatch2 units. I expect to close the year at about $125.
You don't make much money from stock analysis do you?
I don't think a new iPhone 7 will make a lick of difference. I believe there's a fundamental sea change in the smart phone market. The days of premium $700 phones are numbered and not a 'smart' buy. People are happy to get by with decent $300 phones that do 90% of what an iPhone does. Only your hard core Apple enthusiast will ooh and ahh and make the latest design, a must have upgrade.
The sky is not falling, but when the iPhone makes up 70% of Apple's revenues, you have to wonder how hard and fast Apple stock can crash.
I disagree 100% with your assessment. If you are leasing an iPhone from Apple you are literally paying pennies a day for something you use every day for many hours a day. People are willing to pay a few pennies more a day for the best. The smartphone has been the most important item in most people's lives after their house and maybe their car. You really think people are not willing to pay $20 a month for that?
If you buy a cheap $300 phone it will be worthless in 18 months. That means you are paying $17 a month to use a cheap phone. Do you really think people are unwilling to pay $5 more to get an iPhone? That's literally 15 cents more per day.
Your assessment is also wrong because for the last 4 quarters the averaging selling price of iPhones YoY have gone up. People are willing to pay for quality.
Its herd mentality. No point in speculating. We'll know when Apple reports in a few weeks. But your comment about iPhone 7 just shows how pathetic this is. We've heard next to nothing about iPhone 7, certainly not anything that would point to it being some major change from the 6. So what exactly would the resurgence in the stock be for? If we're to believe these rumors and Apple is cutting orders for the 6S why should we believe people are going to rush out and buy the 7 or that we won't be talking about the same damn thing a year from now with analysts predicting 7 cuts but telling everyone things will get better with the 8.
Apple always gets a nice bump up when they change the shell of the phone. iPhone4, 5, and 6 all had nice unit growth. The S-models have been hit and miss. 4s was huge, 5s barely had growth, and the 6s will probably have a slight decline. That means even if only iPhone6 users upgrade to the 7 we will see a YoY unit growth over the 6s. But of course there will be switchers from Android and some 5/4 series holdouts who skipped the 6. So I expect a nice 8-10% unit growth for the iPhone7. That should should help the stock reach about $125. In the 7s shows growth then we see $140 in a couple of years.
With that in mind I'd wait for $80 share price. If taxes isn't a factor I'd even sell shares now at close to $100 and wait for that $80 price in the Spring. Then you can easily get a 50% return by mid 2017.
If you don't have anything better to say beside the stupid comment of $80 price multiple times in the same thread, I suggest you to go to somewhere else to continue spewing the bullshit or you end up to the blocked list of many regular posters here.
If you don't have anything better to say beside the stupid comment of $80 price multiple times in the same thread, I suggest you to go to somewhere else to continue spewing the bullshit or you end up to the blocked list of many regular posters here.
Why so much anger? I'm just giving my opinion based on facts. The last time Apple showed flat/negative revenue growth was 2013. And the stock went down 45% from its peak. Its not a stretch for the stock to go down 40% again if revenue growth goes negative.
Fact is no matter how much profits a company makes if they are not growing revenue they won't be rewarded a PE of over 8-10. Right now Apple's PE is at 11. It can easily get to a PE of 9 if they show negative revenue growth. That gets the price to about $84 and fear can push it to $80.
IMO, this is just a great opportunity to gather capital to buy shares at $80 in a few months. When Apple hit $385 a few years back I thought I would never get such a great opportunity again. Looks like I'm going to get lucky again. I'm getting my $$$ ready for $80 share price. Chomping at the bit.
Its herd mentality. No point in speculating. We'll know when Apple reports in a few weeks. But your comment about iPhone 7 just shows how pathetic this is. We've heard next to nothing about iPhone 7, certainly not anything that would point to it being some major change from the 6. So what exactly would the resurgence in the stock be for? If we're to believe these rumors and Apple is cutting orders for the 6S why should we believe people are going to rush out and buy the 7 or that we won't be talking about the same damn thing a year from now with analysts predicting 7 cuts but telling everyone things will get better with the 8.
Apple always gets a nice bump up when they change the shell of the phone. iPhone4, 5, and 6 all had nice unit growth. The S-models have been hit and miss. 4s was huge, 5s barely had growth, and the 6s will probably have a slight decline. That means even if only iPhone6 users upgrade to the 7 we will see a YoY unit growth over the 6s. But of course there will be switchers from Android and some 5/4 series holdouts who skipped the 6. So I expect a nice 8-10% unit growth for the iPhone7. That should should help the stock reach about $125. In the 7s shows growth then we see $140 in a couple of years.
With that in mind I'd wait for $80 share price. If taxes isn't a factor I'd even sell shares now at close to $100 and wait for that $80 price in the Spring. Then you can easily get a 50% return by mid 2017.
The 4s gave us Siri and came at a time that iPhone was really becoming popular (it had just come to Verizon in Feburary of 2011). The 5 and 6 were screen size changes. Whaf is the 7 going to bring that people didn't get with the 6S? I'm skeptical that a new look or something like wireless charging or losing the headphone jack will cause a massive upgrade. If we're going down the path of D&G then I think we have to go all the way. None of this iPhone 7 will be the savior nonsense.
Its herd mentality. No point in speculating. We'll know when Apple reports in a few weeks. But your comment about iPhone 7 just shows how pathetic this is. We've heard next to nothing about iPhone 7, certainly not anything that would point to it being some major change from the 6. So what exactly would the resurgence in the stock be for? If we're to believe these rumors and Apple is cutting orders for the 6S why should we believe people are going to rush out and buy the 7 or that we won't be talking about the same damn thing a year from now with analysts predicting 7 cuts but telling everyone things will get better with the 8.
I don't think a new iPhone 7 will make a lick of difference. I believe there's a fundamental sea change in the smart phone market. The days of premium $700 phones are numbered and not a 'smart' buy. People are happy to get by with decent $300 phones that do 90% of what an iPhone does. Only your hard core Apple enthusiast will ooh and ahh and make the latest design, a must have upgrade.
The sky is not falling, but when the iPhone makes up 70% of Apple's revenues, you have to wonder how hard and fast Apple stock can crash.
But most people aren't paying $700 upfront for a phone. Go to AT&T, Verizon, T-Mobile or Sprint and the full price of the phone is in fine print. They're either quoting the monthly installment fee or zero down. The price difference between iPhone and a cheaper Anddroid is maybe $5-$10/mo. I don't think that will stop people from buying an iPhone.
The 4s gave us Siri and came at a time that iPhone was really becoming popular (it had just come to Verizon in Feburary of 2011). The 5 and 6 were screen size changes. Whaf is the 7 going to bring that people didn't get with the 6S? I'm skeptical that a new look or something like wireless charging or losing the headphone jack will cause a massive upgrade. If we're going down the path of D&G then I think we have to go all the way. None of this iPhone 7 will be the savior nonsense.
Smaller footprint would be my guess. The 6/6+ are perfect phones except they are too big to fit in many people's pockets and hands.
And it won't take much for the 7 to beat iPhone6s unit sales. They just need to get their historical 90% retention ratings and another 20% of buyers switching from Android.
But yes peak iPhone is coming within the next 5 years or so. Apple really needs to focus on expanding their services to grow revenue from here on out. LiveTV, Cloud, home security, connected home, gaming, movie streaming, search, advertising, banking, and social should all be on Apple's radar. They need to expand to more services. It is much easier to add 10% to services revenue instead of adding 10% unit sales.
Its herd mentality. No point in speculating. We'll know when Apple reports in a few weeks. But your comment about iPhone 7 just shows how pathetic this is. We've heard next to nothing about iPhone 7, certainly not anything that would point to it being some major change from the 6. So what exactly would the resurgence in the stock be for? If we're to believe these rumors and Apple is cutting orders for the 6S why should we believe people are going to rush out and buy the 7 or that we won't be talking about the same damn thing a year from now with analysts predicting 7 cuts but telling everyone things will get better with the 8.
I don't think a new iPhone 7 will make a lick of difference. I believe there's a fundamental sea change in the smart phone market. The days of premium $700 phones are numbered and not a 'smart' buy. People are happy to get by with decent $300 phones that do 90% of what an iPhone does. Only your hard core Apple enthusiast will ooh and ahh and make the latest design, a must have upgrade.
The sky is not falling, but when the iPhone makes up 70% of Apple's revenues, you have to wonder how hard and fast Apple stock can crash.
satchmo - that is pretty much how I see it. iPhone 7 will only be a part of a "recovery" - Apple is lacking in the needle moving innovation a la streaming content for cord cutters / cloud services. Not sure what Apple watch, Homekit, Healthkit, Apple TV, etc. are going to contribute to the improvement in stock price. I do believe that Cook needs to have done a much better job in talking up the stock but the bigger drag is lack of performance in other "non iPhone products".
Sure they were a computer company and they sold computers (they are a cell phone maker now, by revenue), but the computer they sold changed very little while the rest of the market literally stole its' thunder. Apple had trouble producing a follow up, even with Steve, and mounted a brief comeback with the OG Mac. They then had trouble coming up with a comeback after the OG Mac wasn't in favor anymore. They didn't comeback from that fall till the iPod/iMac.
It's unrealistic to think iPhone growth was/is going to be up, up, up every year till infinity. Apple is doing too little to improve it YoY just like they did with the Apple ][ so I think the sales of iPhone will follow suit. Sure throw in "but.. but.. Samsung is doing worse too, so is Sony, so is Moto!" if you want to bury your head. That's because we are reaching that saturation point that slammed PC makers. Once PC's got pretty darn fast, people started to upgrade them much more slowly than they did previously (or they added their first PC during the post-dot-com era and don't upgrade till it's dead). Economy aside, there wasn't a need to upgrade when your PC was still fast enough to do what you wanted, not just needed. Thats when Dell, HP, etc all saw their market kinda dry up. This is where we are approaching with the iPhone and iPad.
The leaps in iPhone speed have been tremendous and a true testament to the engineers at Apple. The same leaps have made me reconsider when my next iPhone purchase will happen. The iPhone 5 was fast enough for what I and a vast majority of others that don't live and breathe tech. I bought a 6 plus thinking bigger would be better, but I'm on a 6 right now. I have no desire for a 6S. The 7 is a definite "wait and see". The only reason I bought a 6 over keeping my 5 is the screen size. Thats the only feature other than TouchID that I use every day that is different from the 5 (if TouchID was important I could have had that in the 5S, but it's not really that important, I just use it every day to unlock my phone now that I have it).
For me to consider a 7 it'll need: real water resistance, better screen, a much better design, and better battery life during intensive tasks. Otherwise I'll just stick with the 6. I've had to spend about $300 in it to bend it (no pun intended) into something I can truly live with (battery case so it can last more than 12 hours if I need it, battery/weather resistant case so I can take it with me more places so my Watch will continue to work well, etc). So after that I'm not in a mood to do it all again. If I don't get a 7, I'll be skipping iOS 10 so I don't end up with "unnecessary, poorly thought out manufactured obsolesce, slow iPhone disease".
It's just not a normal thing out there in the non-mac-forum world to always have the latest iPhone like it is here where you are reading this. In some other circles yes, but those circles are even smaller in number than the mac forum crowd. The market of smart phones has entered or is darn close to saturation. There are emerging markets that could pick up the slack that will develop in the first world but they are too busy being swung around by other economic forces to be a reliable source of new customers for smart phones.
The stock traded at $92 a few months ago. Need to correct the title of the article.
Oh yeah I remember this well. I sold all my stock in my retirement fund and bought it back as quick as I could when I realized my mistake, losing 20 grand in the process! DOH!!! This time I hold.
Exactly! Chinese market is impacting WS badly.. Everything I have has been down every day this week. It's not just APPL .. AI just sensationalizing APPL news for the sake of CLICK BAIT instead of reporting the truth. It's obvious Wall Street is very nervous in all sectors right now because of China's multiple market crashes.
Not really. Apple dropped from $134 to $105 prior to this weeks China crash. That's a decline of 22%. Now look at Facebook, Netflix, Google, and Microsoft before this week. They were all at or near all time highs after posting amazing 2015 returns. Apple stock is just very weak right now. I expect it to go down to $80 in a few months.
Nooo, AAPL drop from its heights is related to the beginning of the chinese stock market crash last summer, and the worries that it would impact the 4Q 2015 results. OK, to be fair I must have said that you are wrong in when the chinese stock market crash started, it was last summer not this week. Another reason was because the 3Q 2015 results where lower than analysts forecasted even if they beated Apple own guidance.
Its herd mentality. No point in speculating. We'll know when Apple reports in a few weeks. But your comment about iPhone 7 just shows how pathetic this is. We've heard next to nothing about iPhone 7, certainly not anything that would point to it being some major change from the 6. So what exactly would the resurgence in the stock be for? If we're to believe these rumors and Apple is cutting orders for the 6S why should we believe people are going to rush out and buy the 7 or that we won't be talking about the same damn thing a year from now with analysts predicting 7 cuts but telling everyone things will get better with the 8.
I don't think a new iPhone 7 will make a lick of difference. I believe there's a fundamental sea change in the smart phone market. The days of premium $700 phones are numbered and not a 'smart' buy. People are happy to get by with decent $300 phones that do 90% of what an iPhone does. Only your hard core Apple enthusiast will ooh and ahh and make the latest design, a must have upgrade.
The sky is not falling, but when the iPhone makes up 70% of Apple's revenues, you have to wonder how hard and fast Apple stock can crash.
If your argument were right by now Apple computer business must be gone forever and is one of the most profitable in the business. When you speak about 700$ phones you have in mind the residuals of them a year later? because as far as I know if you buy something for 700$ but to buy you sell your previous device for 500$ the real cost is 200$. I know people that buy 200$-300$ phones, they assumed that they are buying a disposable good, worthless in a couple of years.
Fact is no matter how much profits a company makes if they are not growing revenue they won't be rewarded a PE of over 8-10. Right now Apple's PE is at 11. It can easily get to a PE of 9 if they show negative revenue growth. That gets the price to about $84 and fear can push it to $80.
You've repeated this $80 quite a few times (I lost count), but you don't say how you arrive at it. Why not $85? Why not $75? Are you predicted a YOY decline in the March quarter, or are you predicting flat earnings and a declining P/E? You're implying flat profits and a declining P/E, but you don't seem to be confident enough to be explicit. Just to be clear, I don't know that you're wrong, but I haven't seen any analysis behind your $80 figure. It looks like you're basing this number on intuition.
You've repeated this $80 quite a few times (I lost count), but you don't say how you arrive at it. Why not $85? Why not $75? Are you predicted a YOY decline in the March quarter, or are you predicting flat earnings and a declining P/E? You're implying flat profits and a declining P/E, but you don't seem to be confident enough to be explicit. Just to be clear, I don't know that you're wrong, but I haven't seen any analysis behind your $80 figure. It looks like you're basing this number on intuition.
I am indeed predicting a YoY decline in revenue for the March quarter and maybe even the June quarter. That would be enough for the market to give Apple a PE of 9. With small declines in revenue I could see profits to be estimated at $50 billion. $50 billion x 9 = $450 billion market cap. That gives you a share price of about $84. But panic and macro news probably drops this to $80.
I am indeed predicting a YoY decline in revenue for the March quarter and maybe even the June quarter. That would be enough for the market to give Apple a PE of 9. With small declines in revenue I could see profits to be estimated at $50 billion. $50 billion x 9 = $450 billion market cap. That gives you a share price of about $84. But panic and macro news probably drops this to $80.
Thanks for the explanation, clear enough. In a couple of weeks we'll see Apple's forecast for the March quarter. What they say won't be gospel, but I can't remember when they haven't at least met their typically conservative forecast. I for one will hold from now to then. If I were to follow your advice and sell now in hopes of buying back at $80, I think that would make me a speculator instead of an investor. Investing in Apple has always worked out for me in the long-run, so I'll leave the speculation to another type of human being.
Comments
-kpluck
If you buy a cheap $300 phone it will be worthless in 18 months. That means you are paying $17 a month to use a cheap phone. Do you really think people are unwilling to pay $5 more to get an iPhone? That's literally 15 cents more per day.
Your assessment is also wrong because for the last 4 quarters the averaging selling price of iPhones YoY have gone up. People are willing to pay for quality.
Fact is no matter how much profits a company makes if they are not growing revenue they won't be rewarded a PE of over 8-10. Right now Apple's PE is at 11. It can easily get to a PE of 9 if they show negative revenue growth. That gets the price to about $84 and fear can push it to $80.
IMO, this is just a great opportunity to gather capital to buy shares at $80 in a few months. When Apple hit $385 a few years back I thought I would never get such a great opportunity again. Looks like I'm going to get lucky again. I'm getting my $$$ ready for $80 share price. Chomping at the bit.
And it won't take much for the 7 to beat iPhone6s unit sales. They just need to get their historical 90% retention ratings and another 20% of buyers switching from Android.
But yes peak iPhone is coming within the next 5 years or so. Apple really needs to focus on expanding their services to grow revenue from here on out. LiveTV, Cloud, home security, connected home, gaming, movie streaming, search, advertising, banking, and social should all be on Apple's radar. They need to expand to more services. It is much easier to add 10% to services revenue instead of adding 10% unit sales.
Sure they were a computer company and they sold computers (they are a cell phone maker now, by revenue), but the computer they sold changed very little while the rest of the market literally stole its' thunder. Apple had trouble producing a follow up, even with Steve, and mounted a brief comeback with the OG Mac. They then had trouble coming up with a comeback after the OG Mac wasn't in favor anymore. They didn't comeback from that fall till the iPod/iMac.
It's unrealistic to think iPhone growth was/is going to be up, up, up every year till infinity. Apple is doing too little to improve it YoY just like they did with the Apple ][ so I think the sales of iPhone will follow suit. Sure throw in "but.. but.. Samsung is doing worse too, so is Sony, so is Moto!" if you want to bury your head. That's because we are reaching that saturation point that slammed PC makers. Once PC's got pretty darn fast, people started to upgrade them much more slowly than they did previously (or they added their first PC during the post-dot-com era and don't upgrade till it's dead). Economy aside, there wasn't a need to upgrade when your PC was still fast enough to do what you wanted, not just needed. Thats when Dell, HP, etc all saw their market kinda dry up. This is where we are approaching with the iPhone and iPad.
The leaps in iPhone speed have been tremendous and a true testament to the engineers at Apple. The same leaps have made me reconsider when my next iPhone purchase will happen. The iPhone 5 was fast enough for what I and a vast majority of others that don't live and breathe tech. I bought a 6 plus thinking bigger would be better, but I'm on a 6 right now. I have no desire for a 6S. The 7 is a definite "wait and see". The only reason I bought a 6 over keeping my 5 is the screen size. Thats the only feature other than TouchID that I use every day that is different from the 5 (if TouchID was important I could have had that in the 5S, but it's not really that important, I just use it every day to unlock my phone now that I have it).
For me to consider a 7 it'll need: real water resistance, better screen, a much better design, and better battery life during intensive tasks. Otherwise I'll just stick with the 6. I've had to spend about $300 in it to bend it (no pun intended) into something I can truly live with (battery case so it can last more than 12 hours if I need it, battery/weather resistant case so I can take it with me more places so my Watch will continue to work well, etc). So after that I'm not in a mood to do it all again. If I don't get a 7, I'll be skipping iOS 10 so I don't end up with "unnecessary, poorly thought out manufactured obsolesce, slow iPhone disease".
It's just not a normal thing out there in the non-mac-forum world to always have the latest iPhone like it is here where you are reading this. In some other circles yes, but those circles are even smaller in number than the mac forum crowd. The market of smart phones has entered or is darn close to saturation. There are emerging markets that could pick up the slack that will develop in the first world but they are too busy being swung around by other economic forces to be a reliable source of new customers for smart phones.
If your argument were right by now Apple computer business must be gone forever and is one of the most profitable in the business. When you speak about 700$ phones you have in mind the residuals of them a year later? because as far as I know if you buy something for 700$ but to buy you sell your previous device for 500$ the real cost is 200$. I know people that buy 200$-300$ phones, they assumed that they are buying a disposable good, worthless in a couple of years.