sacto joe

"The flaw only affects High Sierra and not earlier versions, but it is likely to be shortlived. Wardle advised macOS 10.14 Mojave will block all synthetic events completely...."

Problem is, a LOT of Macs are not going to be upgradeable to Mojave and are presently on High Sierra. Apple had damned well better deal with that issue or there will be hell to pay....

entropys said:

The financial logic behind stock buybacks is simple math.  By definition, fewer outstanding shares means that earning per share goes up, which should mean the value of each share increases.

Yes, but the total value of the shares remains the same. I look at buybacks as a reduction in outstanding liabilities at best.

Think of it a different way. If Apple succeeds in buying back 50% of it’s peak share count, and you bought shares at that peak share time, then those shares would own twice as much of Apple the company as they did when you bought them. Not only that, but those shares were often bought back at some exceedingly low valuations. It’s as if Apple were investing in AAPL in your stead.

GeorgeBMac said:

Analysts and Arm-Chair Analysts each either try to defend or condemn Apple's BuyBacks.   And everybody tries to understand them and their reasons and ramifications.

As an ex-accountant & internal financial analyst, I can say that none of them know what they're talking about.  Yes, they get all the financial statements with all the numbers.   But the real knowledge is what is behind those financial statements as explained to executives in internal meetings and then expanded out into internal long-term strategy meetings -- all stuff that neither we nor the external analysts will ever know about.

But, Apple is not the only company doing it.
And what one analyst said is relavent:  One of the major reasons the stock market has been so high (over the past several years) is simply due to its huge amount of stock buybacks.  So, the question then is:   What would Apple's stock be valued at -- as well as the overall stock market -- if those enormous buybacks had never happened?  Or, what will happen when they stop?   And that may happen sooner rather than later as interest rates rise making debt more expensive.

Apple remains undervalued, in part, because of a lack of appreciation that it’s stock buybacks are NOT a gimmick. I can’t speak for any other company. The reality is that the buybacks are strictly based on cash purchases. Yes, debt was acquired during the years Apple’s foreign cash remained in limbo. But that debt was always covered by cash. Indeed, the move to “cash neutral” means that there will still be cash available equal to the debt even after that point is reached somewhere between 3 and 5 years from now.

The cash Apple spends on buybacks has the effect of increasing each remaining share’s percentage ownership of Apple the company. Thus, if you had bought a share just before the buybacks commenced, your share would represent ownership of well over 35% more Apple. When (not if) Apple reduces the share count to half of what it was before buybacks commenced, each share will equal exactly twice the ownership it did before. Thus Apple’s buybacks are NOT a gimmick, but a legitimate way of returning value to the investor, with the added benefit of deferring taxes until the share is actually sold (unlike dividends outside of an IRA).

The value of AAPL absent these buybacks, IMHO, would be substantially reduced. The fiction would continue that Apple is NOT, as Jim Cramer recently put it, an incredibly successful, rich, and international razor-and-razorblade company, but only a “manufacturer” with ultra-high margins that were bound to be commoditized, and that it’s huge cash surplus was worth nothing vis-a-vis it’s future value and should not be considered when weighing it’s P/E against other companies.

The Awakening is finally happening, in part because Apple now has access to it’s cash worldwide, in part because it has clearly returned incredible value to it’s investors via the buybacks it has already made, and in part because people like Warren Buffett are finally “getting” Apple and realizing what an amazing value it is in terms of future valuation.

You can call me an “arm chair analyst”, but I’ve put my money where my mouth is, that is, by investing heavily in Apple for the long haul. I’ve paid my dues over the decades I’ve owned and watched Apple and AAPL. And I’m in very good company, with the likes of Horace Deidu of Asymco very much in my camp.

So I’ll stack my personal analysis up against your so-called “expertise” any day of the week.

gmgravytrain said:

Apple will likely never reach $200 a share, while Facebook soars beyond $250 and Amazon goes well past $2200 a share. All the FANG stocks will easily outperform Apple both short- and long-term. Tim Cook has done well as Apple's CEO but he's not even close to Zuckerberg or Bezos when it comes to getting investors crazily desperate to buy Apple stock. It's just amazing how badly big investors want to pay $2200 a share and more for Amazon stock. Apple is already out of steam and Amazon is just getting started. Amazon will reach a $1T market cap long before Apple does.

fred stein said:

Arithmetic.

Apple is 4% of the S&P. Apple earns internally about 7%. Apple can buy back 10% of the company and get a 7% ROI. That knocks out any major risk to AAPL.

A 10% hit to AAPL is a .4% hit to S&P 500. How long would this last? Apple will have another $350B to spend on buybacks over the next five years. 

When AAPL goes above $250, we can talk about risk.

It's just my 'opinion' based upon current performance of the stocks I have mentioned.

You don't state it like an opinion, gravy. AMZN and GOOGL are decent stocks, although AMZN in particular is hugely over-valued. At it's present EPS, it would take 279 years for Amazon to equal it's market cap (Netflix 263 years, Alphabet 64 years, and FaceBook 32 years). Apple can do it in 18 without touching a penny of it's $250 B in cash. Of course, that cash is about 5 year's earnings, so technically, it could buy itself back with it's net income and present cash in 13 years.

But keep that price low, Mr. Market. All that does is give Apple more bang per buck for it's buybacks.

Did you know that, if you'd bought AAPL back in 2012 and never sold your shares, you'd own 33% more of the company today? Or that, if they buy back the same number of shares over the next 6 years, you'd have doubled your ownership of Apple? That's the power of all that cash that Amazon can never begin to hope to generate.

Still, maybe you'll be one of the lucky ones to bail on AMZN just before Amazon finally stops growing and the stock crashes around your ears....

bb-15 said:

SpamSandwich said:

StrangeDays said:

muthuk_vanalingam said:

gatorguy said:

With that said the lack of sales didn't prevent the blogosphere blasting at full-volume every perceived failure of the Pixel line whether real, imaginary, widespread or one-off. The tech writers are equal-opportunity click-baiters. If there's a "name" and a possible nega-story they will write it. Apple fans already know that.

Yes, that was true. There are MANY articles written about problems with Pixel phones (particularly Pixel 2 XL, the phone with non-Samsung display) as soon as they were launched. It looked almost as-if Samsung paid tech media to portray Pixel 2 XL in the poorest light possible to me. DED himself wrote few articles about failures of Pixel lineups (both 1st generation and 2nd generation). So not sure, why DED complains about just one website singing praises about Pixel 2nd generation phones when there are PLENTY of articles available in tech media which criticized them.

I think his point is clear. DED’s column isn’t about other tech media, it’s about Bloomberg. And Bloomberg appears to be beating a drum for Google, despite the data indicators favoring Apple. Bloomberg continues to pigeon hole Apple as a failure and Google as a winner despite it plainly being the opposite. 

As a leading investor news outlet, Bloomberg’s coverage is puzzling, and itself is newsworthy. 

All it really proves is that attacking the leader generates more interest than positive coverage. Everyone knows Apple is trouncing their competition, so “bad news” will attract more eyeballs.

There is more to it than attracting more eyeballs (viewers) as if most of the tech audience was neutral about Apple. 
- Apple is a niche company. The majority smartphone OS is Android.
The tendency of large groups is to act in a tribal/school yard way; where the thinking is; my team is good, the other team is the enemy. 
- There is therefore a huge anti-Apple tech audience.
This anti-Apple audience doesn’t care about accuracy but is attracted to negative news about Apple even if it is irrational and false. 
- Tech journalists, like all news outlets, are looking for income and clicks on articles produces that.
Most tech journalists (and many YouTube tech channels) pander to the large audience which dislikes Apple by spreading misinformation.
This trend has gone on for many years.
The MacWorld Macalope column is based on reporting this kind of inaccurate anti-Apple journalism.   

This. I'd also add that it has ever been thus with Apple.

That said, FUD stories like these can seriously ding not only a stock but product sales. Fortunately for Apple, they're no longer the 98 lb weakling that they once were. And I respect their solution; ignore the detractors, focus on making the best product they can, and let their products speak for themselves. How great this last earnings call was, in part because the nay-sayers were quite literally hoisted on their own petards and left to dangle awkwardly in the wind!

So, given the existence of a huge anti-Apple audience, and given a multi-week long period of time every quarter when Apple has to sit on the market sidelines (the so-called "quiet period"), it wouldn't take much to start a "slide" in AAPL by upping the quantity of anti-Apple FUD leading up to and during Apple's quiet period. Sell at the high, then buy back after you've dragging AAPL down, then ride it back up when Apple re-enters the market. Rinse, repeat. A thoroughly destructive process for AAPL's long term value, but the gamblers/leeches do love it....

Only during last quarter's enactment of this little staged performance, in swooped Mr. Buffett and cooly picked up a shit-load of those depressed AAPL shares. And he almost certainly did it this quarter as well. So not only did the anti-Apple click-bait feeders get hoisted, but so did the AAPL manipulators, as Mr. Buffett effectively ate their lunch.

It'll be interesting indeed to see if the performance is attempted yet again, knowing what we now know about investors like Mr. Buffett, who are definitely NOT constrained from buying during Apple's quiet period.

This is the kind of thing that puts all those Apple haters in a blue funk. My heart bleeds.... /s