Is Apple the next Enron/WorldCom?

Posted:
in General Discussion edited January 2014
You know in the news, we've been hearing a bunch about how all these big corporations have been lying about their accounts and all. What if Apple was one of them? I mean I read somewhere that Apple was way overpriced stock wise. They were up there with Gap or something as being companies that were overpriced. Also with executives dumping the stock right before stocks dropped 50%, we are looking at another Martha Stewart case! Apple also has tons of iMacs piling up and most rumors on this forum and other forums talk about only a speed bump of a few Mhz on PowerMacs. They'll need more than a FEW Mhz to compete with the Wintel Machines spec wise. Now even the US post office doesn't want to even support macs on their webpage. What's the deal? Could Apple use MWNY02 to call it quits? Could Jobs' surprise be, we are bankrupt, go home?

I mean I am really worried about this companies future. Do you REALLY think this company can build the capital to stay in the game against Microsoft and its Wintel computers with its faster CPUs and cheaper everything? Sure their OS is inferior, but it works and almost everyone uses it. Most consumers, like me, want more bang for their buck and since Apple overprices everything, it's hard to get the same bang for your buck with an Apple computer. Look at SGI, they were superior in almost everyway back in the day, only problem was that they were much more expensive than the competition. Now their stock is at .25 and no one even cares about them. For instance, do you even know what company I am talking about?? I really hope that I am concerned over nothing but as an Apple shareholder and an Apple computer user I have to think about this company's future, and lately things aren't going so well for big corporations or PC vendors.... Anyway, GO APPLE!



P.S.- Not to mention their new Ad campains... I mean the people in them look like IDIOTS. Like they don't know what's going on or something. Does anyone else share this opinion with me? Also, I am sorry if I posted in the wrong category. I thought the word future was appropriate for this subject matter.



[ 06-30-2002: Message edited by: Macasaurus ]</p>

Comments

  • Reply 1 of 14
    jccbinjccbin Posts: 476member
    Maybe this should go to General Discussion, but I'll go ahead and respond:



    Short of out-and-out Fraud, Apple has one of the tightest, most scrutinized set of books of any company. While some might claim that executive stock sales recently are "insider trading," the truth is likely that Apple's rules for executive sales of stock are so stringent that these were the only times they could sell.



    Apple's finances have been so tightly wound for the last decade that any significant fraud (more than someone raiding the register at the Cupertino Campus store), would have a noticeable effect on Apple itself.



    It will be hard to lay anything at the feet of Jobs - he only gets $1 a year in salary.



    Fred Anderson and the rest of the exec team have very modest salaries - their reward for hard work IS the ability to sell stock options.



    As for the inflated stock prices of 1999 - this was true of most companies due to the "irrational exuberance" of the stock-buying public. Apple's stock in extremely sensitive to market moves and ANY negative announcement hits the stock harder than it should. Look out Monday when the stories from Drudge and Washington Post hit at trading time.



    Just my 0.02
  • Reply 2 of 14
    jambojambo Posts: 3,036member
    Moving to General Discussion..
  • Reply 3 of 14
    mccrabmccrab Posts: 201member
    [quote]Originally posted by Macasaurus:

    <strong>You know in the news, we've been hearing a bunch about how all these big corporations have been lying about their accounts and all. What if Apple was one of them? I mean I read somewhere that Apple was way overpriced stock wise. They were up there with Gap or something as being companies that were overpriced. Also with executives dumping the stock right before stocks dropped 50%, we are looking at another Martha Stewart case! Apple also has tons of iMacs piling up and most rumors on this forum and other forums talk about only a speed bump of a few Mhz on PowerMacs. They'll need more than a FEW Mhz to compete with the Wintel Machines spec wise. Now even the US post office doesn't want to even support macs on their webpage. What's the deal? Could Apple use MWNY02 to call it quits? Could Jobs' surprise be, we are bankrupt, go home?

    I mean I am really worried about this companies future. Do you REALLY think this company can build the capital to stay in the game against Microsoft and its Wintel computers with its faster CPUs and cheaper everything? Sure their OS is inferior, but it works and almost everyone uses it. Most consumers, like me, want more bang for their buck and since Apple overprices everything, it's hard to get the same bang for your buck with an Apple computer. Look at SGI, they were superior in almost everyway back in the day, only problem was that they were much more expensive than the competition. Now their stock is at .25 and no one even cares about them. For instance, do you even know what company I am talking about?? I really hope that I am concerned over nothing but as an Apple shareholder and an Apple computer user I have to think about this company's future, and lately things aren't going so well for big corporations or PC vendors.... Anyway, GO APPLE!



    P.S.- Not to mention their new Ad campains... I mean the people in them look like IDIOTS. Like they don't know what's going on or something. Does anyone else share this opinion with me? Also, I am sorry if I posted in the wrong category. I thought the word future was appropriate for this subject matter.



    [ 06-30-2002: Message edited by: Macasaurus ]</strong><hr></blockquote>
  • Reply 4 of 14
    mccrabmccrab Posts: 201member
    [quote]Originally posted by Macasaurus:

    <strong>You know in the news, we've been hearing a bunch about how all these big corporations have been lying about their accounts and all. What if Apple was one of them? I mean I read somewhere that Apple was way overpriced stock wise. They were up there with Gap or something as being companies that were overpriced. Also with executives dumping the stock right before stocks dropped 50%, we are looking at another Martha Stewart case! Apple also has tons of iMacs piling up and most rumors on this forum and other forums talk about only a speed bump of a few Mhz on PowerMacs. They'll need more than a FEW Mhz to compete with the Wintel Machines spec wise. Now even the US post office doesn't want to even support macs on their webpage. What's the deal? Could Apple use MWNY02 to call it quits? Could Jobs' surprise be, we are bankrupt, go home?

    I mean I am really worried about this companies future. Do you REALLY think this company can build the capital to stay in the game against Microsoft and its Wintel computers with its faster CPUs and cheaper everything? Sure their OS is inferior, but it works and almost everyone uses it. Most consumers, like me, want more bang for their buck and since Apple overprices everything, it's hard to get the same bang for your buck with an Apple computer. Look at SGI, they were superior in almost everyway back in the day, only problem was that they were much more expensive than the competition. Now their stock is at .25 and no one even cares about them. For instance, do you even know what company I am talking about?? I really hope that I am concerned over nothing but as an Apple shareholder and an Apple computer user I have to think about this company's future, and lately things aren't going so well for big corporations or PC vendors.... Anyway, GO APPLE!



    P.S.- Not to mention their new Ad campains... I mean the people in them look like IDIOTS. Like they don't know what's going on or something. Does anyone else share this opinion with me? Also, I am sorry if I posted in the wrong category. I thought the word future was appropriate for this subject matter.



    [ 06-30-2002: Message edited by: Macasaurus ]</strong><hr></blockquote>



    It's worth reading Apple's 10K/10Q filings - $3.7b net cash - and recognising that there were a couple of (un)exceptional years under Sculley (and his successors), a reasonable profit track record. Reading through many years of accounts, they look very clean - it would be difficult for any accountant to signoff on a set of accounts without checking the existence or otherwise of the cash pile.



    This business has real franchise value and has made a number of recent acquisitions which are consistent with a strategy to obtain a strong market position in pro-graphics/digital hub. Further, a simple analysis shows that if you strip out the cash, the equity value is around $2-2.5b, putting it on a very low prospective earnings multiple. Looks like a great buy at these levels.
  • Reply 5 of 14
    pushermanpusherman Posts: 410member
    [quote]Could Apple use MWNY02 to call it quits? Could Jobs' surprise be, we are bankrupt, go home?<hr></blockquote>



    If Apple is bankrupt and calling it quits, that means it burned through almost four billion dollars in cash since their last financial report. It would be nice if we could keep the forum free of this insane level of hyperbole. <img src="graemlins/hmmm.gif" border="0" alt="[Hmmm]" />
  • Reply 6 of 14
    torifiletorifile Posts: 4,024member
    [quote]Originally posted by poor taylor:

    <strong>



    It would be nice if we could keep the forum free of this insane level of hyperbole. <img src="graemlins/hmmm.gif" border="0" alt="[Hmmm]" /> </strong><hr></blockquote>



    Ah, we can dream, can't we? The problem is that we have too many 14 year-old kids who are indistinguishable from actual adults who know a thing or two about what their talking about. I know that we have several GREAT younger members (applenut, EmAn come to mind), but some of these posts, jeez. No, Apple's not going to be the next Enron. The reasons are too many to name, but the first is that Apple doesn't have any of the 'ventures' that Enron used to hide its loses. And they have $4.2bil in the bank.
  • Reply 7 of 14
    torifiletorifile Posts: 4,024member
    dp.



    [ 06-30-2002: Message edited by: torifile ]</p>
  • Reply 8 of 14
    As far as negative financial ethics this sounds more dangerous: <a href="http://channels.netscape.com/ns/news/ns/story.jsp?floc=FF-PLS-PLS&id=403554884&dt=20020629111400&w=APO&coview="; target="_blank">Insider trading charges</a>



    [quote] Apple Execs' Stock Sales Studied





    SAN JOSE, Calif. (AP) - Twice within the last two years, Apple Computer Inc. executives sold company stock worth millions of dollars just weeks before Apple warned of disappointing financial results. Each earnings warning sent shares tumbling.



    While the sales could have an innocent explanation, analysts consider them unusual because at no other point during the period did any other clusters of large sell-offs by Apple executives occur.



    Big stock sales among executives are common, especially in the high-tech sector, where stock options are often a major part of compensation.



    But insider-trading analysts consider the Apple executives' sales unusual because the people involved, though they were mostly exercising stock options, tend to be less active stock sellers.



    ``These sells seem to be well-timed,'' said Lon Gerber, director of insider research at Thomson Financial, coming as they did on the eve of two of three Apple earnings warnings over a period that began in August 2000.



    ``It's always a bit suspicious'' when executives sell before a warning, said Martin Friedman, director of research at Friedman, Billings, Ramsey & Co. Inc.



    The Cupertino-based computer maker defended the sales, which were questioned in a column last week on a Web site for Mac enthusiasts called Resexcellence.com.



    Apple denied any notion of impropriety?? <hr></blockquote>
  • Reply 9 of 14
    torifiletorifile Posts: 4,024member
    [quote]Originally posted by BobtheTomato:

    <strong>As far as negative financial ethics this sounds more dangerous: <a href="http://channels.netscape.com/ns/news/ns/story.jsp?floc=FF-PLS-PLS&id=403554884&dt=20020629111400&w=APO&coview="; target="_blank">Insider trading charges</a>



    </strong><hr></blockquote>



    Let's not overreact to that article. There are no charges currently pending against Apple and insider trading is an individual offense, even if these speculations were true. It would not bring down Apple. But nothing will come of this. As we're fond of saying in psychology, it takes 3 to make a trend. There have only been 2 occasions on which the sell-offs were uncannily timed. In the middle of all that, there was a warning that was not preceded by a sell-off, further weakening the allegations. It's just a matter of journalists jumping on any possible lead in the wake of the Enron scandal to generate hits. Journalists are in the business of reporting on the big news and anything that can be tied to a big story will be, even if it has to be based on conjecture and weak arguments.
  • Reply 10 of 14
    Kim Komando talked about Apple insider trading yesterday,
  • Reply 11 of 14
    buonrottobuonrotto Posts: 6,368member
    Who is that?
  • Reply 12 of 14
    crusadercrusader Posts: 1,129member
    The only time that Apple supposedly manipulated the books, if I recall correctly, was under Amelio when he showed a small ($25 million) profit so that his incredible compensation package would kick in.
  • Reply 13 of 14
    mjpacimjpaci Posts: 79member
    [quote]Originally posted by BuonRotto:

    <strong>Who is that? (Referring to Kim Komando)</strong><hr></blockquote>



    <a href="http://www.komando.com"; target="_blank">Kim Komando</a> has a syndicated radio show that deals with home computing, mostly. The few times I've listened to her I've found her to be pretty knowledgable. I really don't think she touches on Mac issues very much.



    She also has a syndicated column in either Popular Science or Popular Mechanics.



    --Mike
  • Reply 14 of 14
    spartspart Posts: 2,060member
    She writes for Popular Science. She's a big PC fan, but not a Mac hater. She just doesn't touch on the issue of Mac vs. PC very much. At least she isn't another trolling Dvorak spewing forth BS.
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