chinacat
Moderator
AAPL Long since 2006
Posts: 4,425
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Post by chinacat on Nov 21, 2015 7:29:44 GMT -8
Good morning! It was an excellent week, nearly recovering all of last week's loss. Looking for an assault on AAPL's ATH as we cruise through the Western holiday season and into the Eastern one. It's time for our household to upgrade from our 5S's, so we will be trying to do our part. I'm wondering what percentage of the board members have chosen the Apple Upgrade Plan instead of buying through their carriers.
Short week - let's make it a good one!
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Post by rob_london on Nov 21, 2015 7:56:53 GMT -8
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Post by rickag on Nov 21, 2015 8:59:58 GMT -8
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Post by Red Shirted Ensign on Nov 21, 2015 9:16:11 GMT -8
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chinacat
Moderator
AAPL Long since 2006
Posts: 4,425
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Post by chinacat on Nov 21, 2015 10:12:08 GMT -8
Especially for Phoebear...
From Gruber: "Really looking forward to Jimmy Iovine’s comments on women drivers when the Apple car comes out." (rofl)
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Post by phoebear611 on Nov 21, 2015 10:47:21 GMT -8
Especially for Phoebear... From Gruber: "Really looking forward to Jimmy Iovine’s comments on women drivers when the Apple car comes out." I won't be Pah-King my Cah at the Hahvad Yad - no worries !
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Post by rob_london on Nov 21, 2015 12:05:10 GMT -8
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Since84
Moderator
To infinity and beyond!
Posts: 3,933
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Post by Since84 on Nov 21, 2015 14:15:24 GMT -8
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Post by Luckychoices on Nov 21, 2015 20:30:58 GMT -8
Thanks for the link, Rob. I enjoyed reading the article AND the comments (which presently number 252, BTW). Many, if not the majority, of commenters are telling this 22-year-old young man that having 25+% of his portfolio in AAPL is excessive and that he should trim his risk. Geez. He's only 22!! Plus, the article makes it obvious that he didn't invest on a whim but rather identified a strong company with which he's comfortable and it has done well for him. It always amazes me how quickly the financial advice comes from folks who are convinced that they have it all figured out and can tell a stranger how that person has made big mistakes with their investments and how they should re-invest to balance their portfolio. I think the young man, Brian Barbour, did remarkably well in defining why he's investing in AAPL, what he expects from the investment long term and for what reasons he might decide to sell his AAPL stock. In fact, he did a pretty damned thorough investment analysis for a 22-year-old, I'd say. Cheers to the AAPL Longs!! Especially the ones like Brian Barbour who are smart enough to invest in AAPL while still in their 20's!! This is just a portion of the linked article: ===== ...This is one of the reasons why I am still so bullish on Apple. Regardless of what some financial news websites publish about Apple losing it's 'shine' or 'cool factor', it is evident that Apple still has the backing of its supporters. It only takes a trip to any university library to see the momentous number of Apple products being used by students, who are in effect the future. For example, the Mac lineup has been of great popularity. Many students are making use of their university discounts and either upgrading from the previous model or other brand laptops. Growing up, these students will see Apple as the norm and are more likely to continue using their products.
On the contrary, there are many areas where my knowledge lacks. This could come down to being young, lack of interest in the subject matter, or just plain ignorance. This is absolutely fine. It just means I don't invest in these areas. If I invested in these areas for the sole reason of 'achieving diversification', I would be opening myself up to a great deal of risk. This is just not necessary.
When opportunities are present, grab them by the horns
The second part of investing in your strengths is investing at the right price. There are many companies I see doing well. Nike and Starbucks (NASDAQ:SBUX) are both companies I want to own, just not at these prices. There is too much optimism built into the stocks.
On the other hand, Apple is a company I understand well. I have a strong insight into how my generation sees their products and services over their competitors, and most importantly, the valuation is cheap.
Valuation The company stands at a huge discount to the overall market.
Apple's trailing P/E ratio stands at just under 13 while the forward P/E is 11. This represents a 41% discount to the current ratio of the wider market, currently standing at 22.
Apple is priced for a deceleration in earnings, while it is posting ever-growing earnings. The last earnings report showed EPS growth of 38% over the previous year, with guidance showing further record earnings for the near future. An earnings growth that surpasses the wider market.
In addition to this, I believe Apple has in recent years been paving the way to become a future dividend champion. It is managing to consecutively increase dividend payments to shareholders year over year, while maintaining a low payout ratio. Currently, the dividends to shareholders represent only 21% of total earnings. This gives the company a great deal of room to increase payments several years from now.
On top of this, Apple stated in April of this year that the share repurchase program would be increased to $140 billion.
What are my risks?
Having over a quarter of my capital in one stock does mean that if the share price drops significantly, this will drag down the portfolio significantly. Bill Ackman has recently been a victim of this, as Valeant has dropped like a rock after allegations of price gouging surfaced. This has led to him suffering a severe loss of capital and significant underperformance to the market.
To compare this to Apple would be unfair. Apple has many factors that give it a large margin of safety to prevent this. First of all, almost a third of the entire market capitalization is made up of cash and equivalents, and this continues to grow. This allows Apple to raise cheap cash in corporate bonds to facilitate large share repurchases. Secondly, Apple's great P/E discount to the wider market and higher growth rate provides a safety buffer, as it is already priced for no growth.
The only time I will reduce this high allocation is if either of two things happen: Earnings begin to fall, or the share price rises resulting in a P/E ratio similar to the wider market.
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Post by rob_london on Nov 22, 2015 1:43:48 GMT -8
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Post by BillH on Nov 22, 2015 3:53:34 GMT -8
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Post by artman1033 on Nov 22, 2015 4:19:34 GMT -8
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Post by hledgard on Nov 22, 2015 6:07:20 GMT -8
I was in Best Buy on Monroe Street in Toledo yesterday. Three times.
They have a very nice Apple section. There was no one in it
Where was the pin action? In TVs. There has been considerable progress in the last several years in TVs, from backlighting, better color, 4K TVs, and the organic oled TVs . There was definite interest in the TV section.
And of course smart TVs. Almost every better, high-end TV was a smart TV. None of them were Apple oriented. Some were specifically Android compatible.
The strikes me as a problem for Apple. Unlike the automobile, where manufacturers are installing Apple's CarPlay in their cars, the iPhones are generally compatible with the car audio. Not one TV featured any real compatibility with Apple.
Moreover, why would one by an Apple TV box if that smart TV already came equipped with full functionality, more or less equivalent to that provided by the Apple TV.
Is Apple miles behind in this area?
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Post by rickag on Nov 22, 2015 6:50:04 GMT -8
I was in Best Buy on Monroe Street in Toledo yesterday. Three times. They have a very nice Apple section. There was no one in it Where was the pin action? In TVs. There has been considerable progress in the last several years in TVs, from backlighting, better color, 4K TVs, and the organic oled TVs . There was definite interest in the TV section. And of course smart TVs. Almost every better, high-end TV was a smart TV. None of them were Apple oriented. The strikes me as a problem for Apple. Unlike the automobile, where manufacturers are installing Apple's CarPlay in their cars, the iPhones are generally compatible with the car audio. Not one TV featured any real compatibility with Apple. Moreover, why would one by Apple TV if that smart TV already came equipped with full functionality, more or less equivalent to that provided by the Apple TV. Is Apple miles behind in this area? It would appear Apple is behind. There is a pattern though, Apple was behind in MP3 players, phones and watches also. We will have to wait and see how this turns out. I'm sure Apple is either watching this or more than likely spending R&D looking for the proper entry.
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Post by rob_london on Nov 22, 2015 7:15:16 GMT -8
Jony Ive is attending a football match in London this afternoon...and he supports my team !
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Post by sponge on Nov 22, 2015 8:09:55 GMT -8
Jony Ive is attending a football match in London this afternoon...and he supports my team ! Side note Was at an Aviation conference this past week. The guy I was meeting mentioned that Jonny was recently on one of their planes. $16k an hour to fly on these planes. Round trip to London $352,000. Hope to get this London based company to use our local airport soon. Maybe I will meet him. The Apple Store in Santa Monica was fairly busy last night. However no one was looking at the Apple TV. Showed the new Apple TV to my son last night. He was not impressed. I think Apple will need introduce updated versions every year and spend a fair amount in marketing if they want to change television. I think version 3 just like the Apple Watch will blow us away.
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Post by deasys on Nov 22, 2015 10:09:19 GMT -8
I was in Best Buy on Monroe Street in Toledo yesterday. Three times. They have a very nice Apple section. There was no one in it. As ever. That, too, is pretty much always the case for BB. Well, that's the thing—it's not more or less equivalent. The interfaces for "smart" TVs are pretty much universally awful and they don't support the iTunes Store, apps, voice interaction, or AirPlay. By the way, I don't think Apple will ever license the Apple TV software to a TV manufacturer. The very idea brings to mind the horror of the Motorola ROKR… Here's what Neil Cybart has to say about the idea: The Case Against Apple Making a TV Set
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Post by hledgard on Nov 22, 2015 12:53:47 GMT -8
I was in Best Buy on Monroe Street in Toledo yesterday. Three times. They have a very nice Apple section. There was no one in it. As ever. . . . Here's what Neil Cybart has to say about the idea: The Case Against Apple Making a TV SetI think my concern was twofold. 1. Why were the sets not compatible with Apple. The point in the article about Siri and iTunes is relevant here. I assume this would require some real processing and storage, well beyond what is in the sets now. 2. Will the iPhone ever act as a remote control for the layman? I could imagine an app that one uses to change channels or control the volume, etc.
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Mav
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Post by Mav on Nov 22, 2015 18:04:22 GMT -8
hello
hope you all are well
AAPL purgatory - the worst kind of "trading".
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Mav
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Post by Mav on Nov 22, 2015 18:09:16 GMT -8
No one expects 70, 100% YOY unit/rev growth (clearly can't be repeated), but they refuse to say what they really expect for FY16. Heh. 20-25% YOY unit growth for iPhone in China this FY? Doesn't sound too shabby considering the scale of the Greater China rev geo now.
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Since84
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To infinity and beyond!
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Post by Since84 on Nov 23, 2015 3:47:40 GMT -8
I think my concern was twofold. 1. Why were the sets not compatible with Apple. The point in the article about Siri and iTunes is relevant here. I assume this would require some real processing and storage, well beyond what is in the sets now. 2. Will the iPhone ever act as a remote control for the layman? I could imagine an app that one uses to change channels or control the volume, etc. Why do you say most TVs are incompatible with TV? All it takes is an HDMI connection. Granted the use of an external device is more elegant on some than others, but frankly that is a reflection on the TV manufacturer. Further it is no different than if you want to use a surround sound system, gaming system or any of the other attachables available.
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Post by hledgard on Nov 23, 2015 5:01:45 GMT -8
I do know thane can connect an Apple TV to any TV. But the average person may think that the Apple TV is a waste, since the TV is already "smart".
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