It's disgraceful that AAPL is $96 today when it was $130+ over a year ago. A competent CEO foresees macro economic trends and gets ahead of them. Apple's product cycle is so preeeeeeeeeeedictable under Tim Cook that the smart money has gone zzzzzzzzzzzzzzzzzzzzz on the stock. I've enumerated dozens of blunders the company has made from the Beats aquistion tailspin to the watchband being the most interesting aspect of Watch. I was heartened by keynote at WWDC with all the nifty AI baked into the OSes but Apple's software has been so buggy since it became free that numerous problems have tarnished each release. I think Cook should go back to concentrating on the supply chain and promote Jony Ive (or someone with creative juice and vision) to CEO. Ive been saying this for a looooooong time.
Apple watch is just a few percent of Apple sales so that's a weird one. Considering the low PE already, that's a bit of a nonsense declaration there hey JP.
I read through the entire article and it did not indicate that "Apple is doomed", or Apple would not continue to be very profitable.... just that it was a stock with limited growth potential in next several years. Stocks with limited growth potential should get a low PE. When stocks have a high PE the market is betting it is a high growth stock and over the next few years revenue will increase fairly rapidly to match that PE. High PE stocks tend to have higher risks as well (high risk; high reward). I thought the article was fairly balanced, and that because of it's growth potential JP is not recommending it for those purposes. I believe for the next few years Apple stock will trade within a range but will not breakout.... not until they show something new that has a high growth potential. It does not mean the Apple stock is a bad stock to buy, just that it is one of those were you are investing over the long term something that you are going to get regular dividends from. Also, since it is trading low - it has limited downside (as well as upside) and this is a safe stock to buy for value... and hold over the long term.
As a customer care nothing about the stock price -- just that Apple is profitable and "is not doomed" and that it will continue to churn out new products that suit my needs. As a consumer, Apple's future is bright since they have more than enough profit to reinvest into new products.
If Apple's PE was actually much higher a few years ago before the explosion in revenue and profit, you'd have a point. But it was not, so your point doesn't stand at all.
There is no valid reason for Google or Amazon having sky high valuation, there is not enough revenue or profit they could make, or can make to justify it.
So, irrationality, rather than rationality is probably the biggest driver of the Apple stock. The fact Apple's dev is opaque countrary to Google feeds this narrative.
if Apple releases a second generation Apple Watch, those estimates will be doubled. We know where the hedge funds stand now...the short interest doubled this last month and now we sit back and watch all the scare tactic articles claiming " market conditions " and Apple Watch numbers as a reason to sell
No where in that piece did it indicate that JP Morgan analyst was recommending sell. The current price is around $98USD the target that the analyst has set is 105USD (down from $125USD). To me it sounds more like a "HOLD" than a sell recommendation -- with a potential to raise the recommendation a year from now (due to the potential of "solid earnings growth potential" that year).
It is amazing how some Apple fanboys react when someone is not at Apple's feet worshiping them.
Your comment on PE were textbook baseless; the same regurgitated pap I could copy paste from the internet. Same as all other justifying they're deluded notion they "know" how the market really works, that yes, Amazon eventually will produced 150B in profit a year (sic). Even actual people teaching valuation do not peddle your argument with such certainty.
Maybe you should just keep your uppity comments on investment and "fanboys" to yourself in the future.
So why does Apple always get the pessimistic short-term perspective from Wall Street while Wall Street takes the longterm perspective on Facebook, Alphabet, Amazon and Microsoft?
Using the AppleWatch is a reason to downgrade the stock seems specious to me...I think the AppleWatch and Fitbit are changing the way consumers look and think about their wrists.
So it has a similiar uptake as the first generation iPhone? One day ir will have it's iPhone 6 moment because Apple keeps improving the UI. And the hardware will continue to improve.
F¥&K you JPM. I distrust your motivation
Analysts take the short term view on Apple because 1) some are trying to manipulate the stock, 2) some have lost faith in Apple's ability to release new revolutionary products, and 3) some are just fishing for clicks.
Comments
There is no valid reason for Google or Amazon having sky high valuation, there is not enough revenue or profit they could make, or can make to justify it.
So, irrationality, rather than rationality is probably the biggest driver of the Apple stock.
The fact Apple's dev is opaque countrary to Google feeds this narrative.
Your comment on PE were textbook baseless; the same regurgitated pap I could copy paste from the internet.
Same as all other justifying they're deluded notion they "know" how the market really works, that yes, Amazon eventually will produced 150B in profit a year (sic).
Even actual people teaching valuation do not peddle your argument with such certainty.
Maybe you should just keep your uppity comments on investment and "fanboys" to yourself in the future.