Mav
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Post by Mav on Dec 14, 2012 13:05:05 GMT -8
As we head into the weekend...
Heartbreaking tragedy in Newtown, CT.
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Post by Tetrachloride on Dec 14, 2012 13:41:00 GMT -8
Once again, a dismal week in AAPL, the nation, Oregon and Connecticut. For those people in Connecticut, our deepest sympathies, as well as a school in central Chinese village in Henan Province.
Starting at home, regrouping with some homemade soup. This time, I will actually use a recipe.
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Post by qualitywte on Dec 14, 2012 14:16:19 GMT -8
Thinking of converting my '15 leaps to '14's, would like the opinion of this group. Not going to act on anything except my own decision, just curious what you guys think of such a move given the current state of AAPL?
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Mav
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Post by Mav on Dec 14, 2012 14:19:02 GMT -8
Btw...at what point does AAPL become a value stock? (Heck, it already is.)
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Post by Deleted on Dec 14, 2012 14:31:10 GMT -8
Apple has to prove itself after 2 disappointing/average quarters (for both Wall Street & independent analysts).
I think Wall Street fears a company that flys high fast and can crash and burn in a fireball, and prefers companies that have boring but stable earnings.
I was expecting to head back towards $500 after the july earnings report snd instead was happily bewildered to be proven wrong as we moved to $700.
In hindsight the move to $700 was obviously an anomaly not supported by anything, be it technicals or fundamentals. Maybe it was a pure momentum rally sparked by who knows what.
Much depends on Q1 - it will be make or break for the stock. If apple earns under $14 a share I wouldn't expect to see a PE over 13 anytime in the next 6 months.
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Post by Deleted on Dec 14, 2012 14:34:01 GMT -8
Btw...at what point does AAPL become a value stock? (Heck, it already is.) I'm guessing value stocks don't often have projected falls in trailing twelve month earnings, which is precisely what apple has guided for next quarter.
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Post by qualitywte on Dec 14, 2012 14:56:03 GMT -8
Btw...at what point does AAPL become a value stock? (Heck, it already is.) I'm guessing value stocks don't often have projected falls in trailing twelve month earnings, which is precisely what apple has guided for next quarter. No one is "projecting" that. Apple has guided ultra conservative before and I like that they do it now after the last two quarterly reports.
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Mav
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Post by Mav on Dec 14, 2012 15:26:00 GMT -8
It's smart, and a bit more defensible given the huge, aggressive new product push.
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Post by johng on Dec 14, 2012 15:47:32 GMT -8
Btw...at what point does AAPL become a value stock? (Heck, it already is.) I'm guessing value stocks don't often have projected falls in trailing twelve month earnings, which is precisely what apple has guided for next quarter. Q1 2012 Guidance: $37B rev and $9.3 earnings Q1 2013 Guidance: $52B rev and $11.75 earnings I'd say Apple expects a YOY increase in rev/earnings. We'll know in a little over month from now. ;D cheers JohnG
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Post by Deleted on Dec 14, 2012 16:17:00 GMT -8
If only there was some hedge fund with 120+ Billion dollars that was earning almost nothing on that money that could invest in Apple at such a fantastic time.
I can't believe that Tim Cook and the Board aren't looking at an immediate buyback at these levels...it's just bad management if you ask me. They could easily spend $30 - $40 Billion on a buyback at these levels and not have it effect their ability to increase dividends, make investments in other companies or run their day to day business.
That would really send the bears running.
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Post by bryanyc on Dec 14, 2012 16:35:51 GMT -8
We are looking at a perfect storm here: a few flat quarters due to product line changes, typical bad press cycle, and a huge tax selling wave. This tide is near its peak but there is the storm as well. There is that gap up around 478... But for next year: don't bet against AAPL, whatever you do.
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Mav
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Post by Mav on Dec 14, 2012 16:37:39 GMT -8
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Post by Tetrachloride on Dec 14, 2012 16:41:48 GMT -8
$ 100 off iPad 4 ? Speaks to good margins and its a loss-leader, sort of. (actually, its still a profit) Anything to get people in to Walmart to buy a lot of products.
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Mav
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Post by Mav on Dec 14, 2012 16:43:54 GMT -8
Cl4, partly depends on what _Apple_ sells it to Wal-Mart for. Also, targeted shopping - as in iPad only, thanks cya next year Wal-Mart for the 2013 deals - is entirely possible, subverting Wal-Mart's attempts at having a loss leader (more like, just a loss).
I'm not gonna lie, this wave of promotions at least raises an eyebrow.
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Post by phoebear611 on Dec 14, 2012 16:47:51 GMT -8
Where are we P/E at this point? Somewhere around 11? The insanity of it all.
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Post by phoebear611 on Dec 14, 2012 17:00:04 GMT -8
Watching all the events of the CT shooting unfold was surreal for all of - I have no doubt. As the day went on...the news seemed to have gotten exponentially worse. It was incomprehensible when all was said and done.
I looked at my Twitter account this evening and read some of the commentary - naturally there were tweets about the fiscal cliff. I thought to myself that we have these politicians in Washington digging their heels in on taxes and/or spending - it is all so insignificant in the scheme of things. If today's tragic events do not soften a person's stubbornness and tug at one's heart to attempt to live in some type of harmony....politically, socially, economically....well, I don't know what will. This nation needs to heal at every level and move on.
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Post by phoebear611 on Dec 14, 2012 17:07:41 GMT -8
Walmart discounts making their way thru the Twitter-sphere. Chances are that WMT takes the margin hit - we don't even know for certain but what the hell - just keep piling it on!
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Post by johng on Dec 14, 2012 17:21:52 GMT -8
If only there was some hedge fund with 120+ Billion dollars that was earning almost nothing on that money that could invest in Apple at such a fantastic time. I can't believe that Tim Cook and the Board aren't looking at an immediate buyback at these levels...it's just bad management if you ask me. They could easily spend $30 - $40 Billion on a buyback at these levels and not have it effect their ability to increase dividends, make investments in other companies or run their day to day business. That would really send the bears running. Not exactly accurate: Most of Apple's "cash" is offshore and would incur a BIG tax hit if repatriated. Apple could probably afford a very modest one time buyback of $10B but even that is pretty unlikely given Apple's historic use of their cash. JohnG
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Post by Deleted on Dec 14, 2012 17:36:18 GMT -8
Cl4, partly depends on what _Apple_ sells it to Wal-Mart for. Also, targeted shopping - as in iPad only, thanks cya next year Wal-Mart for the 2013 deals - is entirely possible, subverting Wal-Mart's attempts at having a loss leader (more like, just a loss). I'm not gonna lie, this wave of promotions at least raises an eyebrow. I wouldn't be surprised if apple is offering some sort of discount - iPad 4s are in stock everywhere, but unfortunately everyone wants the out of stock iPad mini.
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Post by Deleted on Dec 14, 2012 17:44:41 GMT -8
If only there was some hedge fund with 120+ Billion dollars that was earning almost nothing on that money that could invest in Apple at such a fantastic time. I can't believe that Tim Cook and the Board aren't looking at an immediate buyback at these levels...it's just bad management if you ask me. They could easily spend $30 - $40 Billion on a buyback at these levels and not have it effect their ability to increase dividends, make investments in other companies or run their day to day business. That would really send the bears running. Not exactly accurate: Most of Apple's "cash" is offshore and would incur a BIG tax hit if repatriated. Apple could probably afford a very modest one time buyback of $10B but even that is pretty unlikely given Apple's historic use of their cash. JohnG I was under the impression that Apple had somewhere between 35 and 40 B in the US?
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Mav
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Post by Mav on Dec 14, 2012 18:04:35 GMT -8
Apple generates cash continuously, but it still has to commit it and reserve what it has for many good reasons. I could easily be wrong on this, but I thought I heard somewhere that Apple can't provide "offshore" dividends. And the majority of Apple's cash/equivalents are outside the US. Apple _could_ announce a big buyback program, but tax laws and circumstances apparently make it impossible to leverage the whole of its cash for something like that.
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Post by johng on Dec 14, 2012 18:05:15 GMT -8
Not exactly accurate: Most of Apple's "cash" is offshore and would incur a BIG tax hit if repatriated. Apple could probably afford a very modest one time buyback of $10B but even that is pretty unlikely given Apple's historic use of their cash. JohnG I was under the impression that Apple had somewhere between 35 and 40 B in the US? Yes, around $35B................. which leaves them very wiggle room in terms of buybacks. Apple is notoriously stingy with their cash (no large purchases ever) and that MO is not going to change anytime soon. JohnG
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Post by Deleted on Dec 14, 2012 18:14:44 GMT -8
I was under the impression that Apple had somewhere between 35 and 40 B in the US? Yes, around $35B................. which leaves them very wiggle room in terms of buybacks. Apple is notoriously stingy with their cash (no large purchases ever) and that MO is not going to change anytime soon. JohnG Exactly my point...they don't need this money because they aren't a company that does massive acquisitions, so why not spend 35B on buybacks, save the 80 Billion overseas for a rainy day. Or even just announce the board OK'ing a buyback of up to 50 Billion, spend half that and watch the bears run. Even announcing the ability to do a significant buyback would be encouraging.
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Post by johng on Dec 14, 2012 19:09:29 GMT -8
Apple currently needs almost $10B/year (from domestic reserves) just to service the current divi level and it's likely they will bump the divi in Q2. Additionally, there will always be some modest+ acquisitions to contend with. All in all, Apple has decent domestic reserves and Apple understands the limit to those reserves. i.e. until there's a repatriation of some of the offshore cash don't hold your breath for anything more than the current buyback and ongoing divi (plus yearly bumps in the divi).
JohnG
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Post by playultimate on Dec 14, 2012 20:23:39 GMT -8
Macrumors corrected the story to note that it is the iPad 3 that is discounted; not iPad4.
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Mav
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Post by Mav on Dec 14, 2012 20:24:55 GMT -8
Kind of a difference, huh.
Thanks for the heads-up.
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JDSoCal
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Post by JDSoCal on Dec 14, 2012 21:06:41 GMT -8
BTW, lost in the horror of today, I accidentally caught Dumb Nathan and his ilk on Options Action discussing AAPL. What utter stupidity. The few times they forayed into FA, it was so dumb, it made my head hurt. Nathan was prattling on about margins, as if he had any idea what Apple's really are this quarter. Then Scott Nations blurted out something about Apple's need to finally launch iTV that we've all been waiting for. You know, those high margin TVs. Mike Khouw$#!t was being his usual clueless self. And the always-dreadful Steve Grasso was there too, just keep the average IQ around room temp. Oh, and they mentioned the Wal-Mart iPad discounts, as if loss leaders were some red flag. Summed up succinctly in a tweet, Equally dumb were the idiots on Lose Your Money Fast on Thursday. These guys (Adami, et al) spent a whole segment talking about how they liked RIMM and HPQ's and NFLX charts, without once mentioning the fundamental issue that the companies are circling the drain. Companies losing money, or with stratospheric P/Es. I don't know what's worse, when the CNBC rabble discusses FA, or ignores it in favor of squiggly lines when giving advice on doomed companies.
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Post by mbeauch on Dec 14, 2012 23:24:02 GMT -8
If only there was some hedge fund with 120+ Billion dollars that was earning almost nothing on that money that could invest in Apple at such a fantastic time. I can't believe that Tim Cook and the Board aren't looking at an immediate buyback at these levels...it's just bad management if you ask me. They could easily spend $30 - $40 Billion on a buyback at these levels and not have it effect their ability to increase dividends, make investments in other companies or run their day to day business. That would really send the bears running. +100%
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Post by mbeauch on Dec 14, 2012 23:34:21 GMT -8
Apple currently needs almost $10B/year (from domestic reserves) just to service the current divi level and it's likely they will bump the divi in Q2. Additionally, there will always be some modest+ acquisitions to contend with. All in all, Apple has decent domestic reserves and Apple understands the limit to those reserves. i.e. until there's a repatriation of some of the offshore cash don't hold your breath for anything more than the current buyback and ongoing divi (plus yearly bumps in the divi). JohnG You are right about the $10 bil/year, but Apple can take 30B from its reserves today and buy shares. The divy is easily paid out of FCF/qtr. There is nothing safer than buying back shares.
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Mav
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Post by Mav on Dec 14, 2012 23:45:04 GMT -8
I think you'll hear from Apple about buybacks before next June, esp. at this rate.
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