"Two major publications have openly questioned whether investors will continue to stand by one of the most profitable companies in the world," then everyone else piled on.
How does stuff like this really get started? Yeah, sure, Apple doesn't deliver a new, break-through product category in 4 years, but a big part of me says this is sparked by Samsung advertising dollars.
You obviously really need to understand a zero-sum-game better. Linking to some website definitions don't improve your display of knowledge. If I purchase Share X at Price Y, then the shares appreciate over time to 2Y, and I elect to take profits at that point and sell my stock, I have made a net profit of 100%. If the entity that purchases from me holds the stock for a period (second, minute, hour, day, week or year) and the price of the stock goes up in that time, and the entity sells the stock to lock in its gains, I did not become a loser because I made 100% profit, and the entity is not a loser because it also made money. The problem for investors is, of course, there is no guarantee of profit, and if you don't follow your holdings closely, you can take hits in the short or the long term. This potential to lose money does not make the stock market a zero-sum-game, however.
You obviously really need to understand a zero-sum-game better. Linking to some website definitions don't improve your display of knowledge. If I purchase Share X at Price Y, then the shares appreciate over time to 2Y, and I elect to take profits at that point and sell my stock, I have made a net profit of 100%. If the entity that purchases from me holds the stock for a period (second, minute, hour, day, week or year) and the price of the stock goes up in that time, and the entity sells the stock to lock in its gains, I did not become a loser because I made 100% profit, and the entity is not a loser because it also made money. The problem for investors is, of course, there is no guarantee of profit, and if you don't follow your holdings closely, you can take hits in the short or the long term. This potential to lose money does not make the stock market a zero-sum-game, however.
If I purchase Share X at Price Y, I am purchasing it from another entity.
That other entity will therefore not enjoy my "net profit of 100%."
Or, in case I take a loss, that entity avoided the loss.
I wish the stock market would devalue apple, drop the share price to record lows. That would be a dream come true. But it'll never happen, cause they know apple will come in and scoop up all the shares, and never have to listen to them again, and not share their profits. I wonder if the share price will drop enough in the near future for apple to buy another big chunk back?
You know Cook is secretly hoping for their share price to fall to $400. Apple would save billions if this happened. I think a huge drop in share price in the next few months is a positive for long-term holders. At $400, Apple would be valued at around 4 times what they'll profit in 2015. I could see Apple buying back $100b in shares if the stock drops significantly.
For most of the assembledom here, Apple doesn't really care about the stock price or what Wall Street thinks, witness comments Tim Cook made recently at the stockholder's meeting "We do a lot of things for reasons besides profit motive," he told the group. "We want to leave the world better than we found it." What he said isn't the point of the quote so please don't pedantically arguer the validity of it. I am just using this as an example of the Apple management team's outright disdain of company outsiders and their desire for Apple to cowtow to Wallstreet's very shortsighted investment theories/strategies/ideas.
@ nkhm - Taking Apple private might be a theoretically good idea (I caution *might*) but at Apple's overall valuation it would be practically impossible, so discussing it is a non-starter in circles where people actually want to discuss things rationally.
@ajbdtc826 - cars have been in existence for approximately 128 years, and for the last 20 years or so, there have been no really big breakthroughs (discounting Elon Musk's work for now), do you want car manufacturers to move on to the next big thing, and if so, what would you suggest. Iterative improvements and refinements have worked in many industries for centuries; Apple have been here for approximately 38 years, and look where their iterative improvements have taken us. Don't let the idea of the mythical perfect/utopian device (that of all the tech sector entities, Apple is most likely to create) get in the way of enjoying the nearly perfect stuff they are currently crafting/producing/selling.
For the auto industry, a lot of advancements have been made in the areas of safety, becoming more efficient, performance, and mfg processes. Back 20 years ago, it was difficult to find cars that would go 0-60 under 7 seconds, now that is EASY for them to do. But more importance is on more fuel efficiency WITH decent performance is the key.
Tim Cook needs to get a little more aggressive as he can't be too touchy feely. Sure, they have to be more green conscious, but not slacking on innovation, and kicking production into gear to meet demand making products in key areas they lack, etc.
What I'm missing that I think a lot of others are is that when they have a product announcement, it's like 80% to 90% of what we want/expect. But they need to do just a little more to make it a GREAT announcement.
One thing for sure, at least they aren't STUPID in making Google Glass. As much attention as that POS was/is making, I think it's going to flop. I don't think products will be that successful when it's already getting banned at public places BEFORE it actually starts selling. :-)
Tell that to the millions who have built and owned houses, sent their kids to college, taken vacations, retired well, and paid for their health care from investing -- and staying the course for the long haul -- in the stock market.
... and all the people on this board who have apparently made mucho dineros on AAPL... or at least that's what we keep hearing.
If I purchase Share X at Price Y, I am purchasing it from another entity.
That other entity will therefore not enjoy my "net profit of 100%."
Or, in case I take a loss, that entity avoided the loss.
Get it?
The example you use is not related to a zero-sum-game. Certain commodities market trading action actually is a zero-sum-game, but the stock market is not. Reread some of the definitions you looked up.
I think that this earnings report will offer a last chance for a really good price on Apple stock over the next 3 years. If Apple drops to a PE of 12, you can expect Mr Cook to throw down another 15 billion to buy back the stock. That will remove another 3% of stock outstanding and continue to make the remaining shareholders wealthy. The really funny part is that even if some of the Institutional owners would prefer to keep the stock, if they are part of a index fund they will have to liquidate stock at these low prices and buy it back when the price rises.
It really makes you wonder why so many funds can't beat index funds for returns. Could it be that the person running the fund has his own interest ahead of those of his client?
As far as Microsoft's PE, it should be better. They finally have a leader who understands technology at the helm of the company. Microsoft has a stake in the future of the cloud for all those bureaucratic businesses who still use their software.
Ok well I certainly am not suggesting now nor ever have suggested that there is nothing more to come from Apple. But I'm not surprised at the Wall Street sentiment considering Apple has has several quarters of little to no growth and flat to declining profits. And throw in the fact they basically go quiet for 6-9 months now and this is why we have the media memes and sentiment we do. If Apple isn't going to fill the vacuum others will.
WS will always fill in any gap, no matter the size. How long after the iPhone was release were there rumors of everything.
Apple has become painfully predictable and stuck in<span style="line-height:1.4em;"> slow motion</span>
innovation-wise<span style="line-height:1.4em;">. The media and Wall Street are correct! Tim Cook has </span>
<span style="line-height:1.4em;">put </span>
<span style="line-height:1.4em;">Apple in position where Cupertino now needs to prove it still</span>
<span style="line-height:1.4em;"> possesses</span>
<span style="line-height:1.4em;"> "fire in its belly</span>
<span style="line-height:1.4em;">". </span>
<span style="line-height:1.4em;">?My radar leads me to conclude the iW</span>
atch<span style="line-height:1.4em;"> is </span>
imminent<span style="line-height:1.4em;">. That may move the needle! A larger iPhone will plug the dyke but I think it's too late to be </span>
significant<span style="line-height:1.4em;"> because</span>
<em style="line-height:1.4em;"></em> everyone<span style="line-height:1.4em;"> expects it. By </span>
making Apple TV a hobby for way too long I fear Apple has blown that opportunity too! There are people in denial here but the fact remains, compared to what Apple was in 2007-2011, the company is a bloody mess.
Slow innovation wise? I guess only new product lines count as innovation. Six year btw iPod and iPhone. 3 years btw iPhone and iPad.
As apple continues to make 40 billion dollars a year and adding to their cash pile of 150 billion while buying back stock and paying dividend.... Investors and wallstreet get impatient!
Ps to the ones living under a rock Apple in the last 10 to 12 years .. Has released 1 game changing product every 3 to 4 years !
Apple in the last 10 to 12 yeas has released 1 game changing product ever 3 to 4 years! What innovation slow down. Innovation slowdown is nothing but media fud. ! Most probably started by samdung and alike !
It's insane how Apple gets graded on a curve that no other company can compare to all the while they are being incredibly profitable. At the same time other companies get a free pass for increasing market share without showing a profit. Definitely a double standard that questions the twisted logic of Wall Street.
The good news is that Tim Cook recognizes the value of always delivering customer value and leading the customer to places their customers didn't know could exist, much less exist in the grandeur of Apple design excellence.
The true leaders are those who can move us forward with a sense of purpose in the face of uncertainty and doubt and not be swayed by the fat cat naysayers who are looking for a quick fix to their insatiable need for immediate gratification. Too many Wall Street analysts behave like heroin addicts in need of a fix - right now.
So no matter the level of whining exhibited by the financial crack heads and doomsday analysts I expect Apple to stay the course and do what they do best on their own terms. So far so good.
Comments
"Two major publications have openly questioned whether investors will continue to stand by one of the most profitable companies in the world," then everyone else piled on.
How does stuff like this really get started? Yeah, sure, Apple doesn't deliver a new, break-through product category in 4 years, but a big part of me says this is sparked by Samsung advertising dollars.
So, everybody who invests money in any random stock will make money?
No.
Are there infinite number of shares available to be bought at any time?
No. There is a buyer and a seller for each share. Only one of them will be better-off.
Here are a few definitions of "zero-sum game" in case you need a refresher:
http://www.nasdaq.com/investing/glossary/z/zero-sum-game
http://www.investopedia.com/terms/z/zero-sumgame.asp
http://en.wikipedia.org/wiki/Zero_sum_game
Get some basic financial education. Please. If not for yourself, for your family.
Cue the usual, completely unfounded blather: "Wall-Street-is-a-gambling-den," "analysts-are-stupid-venal-low-lifes," "everyone-manipulates-stock-prices," "last-year's-profits-should-tell-us-all-we-need-to-know-about-this-year's-stock-prices," "Apple-should-go-private," "Time-Cook-should-stay/go," "Apple-does/does-not-innovate".
Am I missing anything?
Apple is Doomed?
So, everybody who invests money in any random stock will make money?
No.
Are there infinite number of shares available to be bought at any time?
No. There is a buyer and a seller for each share. Only one of them will be better-off.
Here are a few definitions of "zero-sum game" in case you need a refresher:
http://www.nasdaq.com/investing/glossary/z/zero-sum-game
http://www.investopedia.com/terms/z/zero-sumgame.asp
http://en.wikipedia.org/wiki/Zero_sum_game
You obviously really need to understand a zero-sum-game better. Linking to some website definitions don't improve your display of knowledge. If I purchase Share X at Price Y, then the shares appreciate over time to 2Y, and I elect to take profits at that point and sell my stock, I have made a net profit of 100%. If the entity that purchases from me holds the stock for a period (second, minute, hour, day, week or year) and the price of the stock goes up in that time, and the entity sells the stock to lock in its gains, I did not become a loser because I made 100% profit, and the entity is not a loser because it also made money. The problem for investors is, of course, there is no guarantee of profit, and if you don't follow your holdings closely, you can take hits in the short or the long term. This potential to lose money does not make the stock market a zero-sum-game, however.
You obviously really need to understand a zero-sum-game better. Linking to some website definitions don't improve your display of knowledge. If I purchase Share X at Price Y, then the shares appreciate over time to 2Y, and I elect to take profits at that point and sell my stock, I have made a net profit of 100%. If the entity that purchases from me holds the stock for a period (second, minute, hour, day, week or year) and the price of the stock goes up in that time, and the entity sells the stock to lock in its gains, I did not become a loser because I made 100% profit, and the entity is not a loser because it also made money. The problem for investors is, of course, there is no guarantee of profit, and if you don't follow your holdings closely, you can take hits in the short or the long term. This potential to lose money does not make the stock market a zero-sum-game, however.
If I purchase Share X at Price Y, I am purchasing it from another entity.
That other entity will therefore not enjoy my "net profit of 100%."
Or, in case I take a loss, that entity avoided the loss.
Get it?
You know Cook is secretly hoping for their share price to fall to $400. Apple would save billions if this happened. I think a huge drop in share price in the next few months is a positive for long-term holders. At $400, Apple would be valued at around 4 times what they'll profit in 2015. I could see Apple buying back $100b in shares if the stock drops significantly.
They don't know anything. Blocked.
I'm a former employee in Austin and am best friends with an Apple designer. This is the Internet, though, so I could be making this all up, sure.
For most of the assembledom here, Apple doesn't really care about the stock price or what Wall Street thinks, witness comments Tim Cook made recently at the stockholder's meeting "We do a lot of things for reasons besides profit motive," he told the group. "We want to leave the world better than we found it." What he said isn't the point of the quote so please don't pedantically arguer the validity of it. I am just using this as an example of the Apple management team's outright disdain of company outsiders and their desire for Apple to cowtow to Wallstreet's very shortsighted investment theories/strategies/ideas.
@ nkhm - Taking Apple private might be a theoretically good idea (I caution *might*) but at Apple's overall valuation it would be practically impossible, so discussing it is a non-starter in circles where people actually want to discuss things rationally.
@ajbdtc826 - cars have been in existence for approximately 128 years, and for the last 20 years or so, there have been no really big breakthroughs (discounting Elon Musk's work for now), do you want car manufacturers to move on to the next big thing, and if so, what would you suggest. Iterative improvements and refinements have worked in many industries for centuries; Apple have been here for approximately 38 years, and look where their iterative improvements have taken us. Don't let the idea of the mythical perfect/utopian device (that of all the tech sector entities, Apple is most likely to create) get in the way of enjoying the nearly perfect stuff they are currently crafting/producing/selling.
For the auto industry, a lot of advancements have been made in the areas of safety, becoming more efficient, performance, and mfg processes. Back 20 years ago, it was difficult to find cars that would go 0-60 under 7 seconds, now that is EASY for them to do. But more importance is on more fuel efficiency WITH decent performance is the key.
Tim Cook needs to get a little more aggressive as he can't be too touchy feely. Sure, they have to be more green conscious, but not slacking on innovation, and kicking production into gear to meet demand making products in key areas they lack, etc.
What I'm missing that I think a lot of others are is that when they have a product announcement, it's like 80% to 90% of what we want/expect. But they need to do just a little more to make it a GREAT announcement.
One thing for sure, at least they aren't STUPID in making Google Glass. As much attention as that POS was/is making, I think it's going to flop. I don't think products will be that successful when it's already getting banned at public places BEFORE it actually starts selling. :-)
Utter nonsense.
Tell that to the millions who have built and owned houses, sent their kids to college, taken vacations, retired well, and paid for their health care from investing -- and staying the course for the long haul -- in the stock market.
... and all the people on this board who have apparently made mucho dineros on AAPL... or at least that's what we keep hearing.
If I purchase Share X at Price Y, I am purchasing it from another entity.
That other entity will therefore not enjoy my "net profit of 100%."
Or, in case I take a loss, that entity avoided the loss.
Get it?
The example you use is not related to a zero-sum-game. Certain commodities market trading action actually is a zero-sum-game, but the stock market is not. Reread some of the definitions you looked up.
Are there infinite number of shares available to be bought at any time?
No. There is a buyer and a seller for each share. Only one of them will be better-off.
Not quite right.
I made money from AAPL selling at $545 after buying at $390, thinking that it should have topped out at that point (and, technically, it should have).
Shortly after that it went up to $700.
If the person who bought my shares at $545 kept them until $700 and then sold... well, we would have both made about the same amount of money.
Anyone buying long at $700 would then have lost money... if they have sold since that time.
It really makes you wonder why so many funds can't beat index funds for returns. Could it be that the person running the fund has his own interest ahead of those of his client?
As far as Microsoft's PE, it should be better. They finally have a leader who understands technology at the helm of the company. Microsoft has a stake in the future of the cloud for all those bureaucratic businesses who still use their software.
WS will always fill in any gap, no matter the size. How long after the iPhone was release were there rumors of everything.
Slow innovation wise? I guess only new product lines count as innovation. Six year btw iPod and iPhone. 3 years btw iPhone and iPad.
Actually Sept 2011, Apple was at 400
Ps to the ones living under a rock
Apple in the last 10 to 12 years .. Has released 1 game changing product every 3 to 4 years !
AAPL
Sept 2011 - $700
April 2014 - $526
Apple's value is in an extended state of atrophy in an otherwise booming economy. Yes, I'd say that's a bloody mess!
Apple's stock price is a mess. Apple, the company, is doing just fine.
[oh... and, yes... September 2012 - $700... not September 2011 ]
OT: TouchID is amazingly fast with the 7.1.1 update!
What innovation slow down.
Innovation slowdown is nothing but media fud. ! Most probably started by samdung and alike !
Here's a thought. Why doesn't Wall Street just go f*ck themselves. This is getting so old it's covered in moss....
The good news is that Tim Cook recognizes the value of always delivering customer value and leading the customer to places their customers didn't know could exist, much less exist in the grandeur of Apple design excellence.
The true leaders are those who can move us forward with a sense of purpose in the face of uncertainty and doubt and not be swayed by the fat cat naysayers who are looking for a quick fix to their insatiable need for immediate gratification. Too many Wall Street analysts behave like heroin addicts in need of a fix - right now.
So no matter the level of whining exhibited by the financial crack heads and doomsday analysts I expect Apple to stay the course and do what they do best on their own terms. So far so good.