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Post by archibaldtuttle on Jan 6, 2016 9:52:30 GMT -8
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Post by dreamRaj on Jan 6, 2016 10:02:30 GMT -8
True. The buybacks haven't done much to increase the share price either.
It's clear that everyone sees the cash hoard as wasted talent and not as an asset. I wish Apple had bought out some companies instead. It still can.
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Post by archibaldtuttle on Jan 6, 2016 10:13:22 GMT -8
True. The buybacks haven't done much to increase the share price either. It's clear that everyone sees the cash hoard as wasted talent and not as an asset. I wish Apple had bought out some companies instead. It still can. Agree that the buyback have been a waste. I wish they would have kept the money - at a certain point the cash price will exceed the market cap and the value would be impossible to ignore.
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Post by tricouleur on Jan 6, 2016 10:18:22 GMT -8
Bought my first shares in 2009 and foolishly sold them in spring 2013 pretty much near the bottom at $365 pre-split when it looked like aapl was in a dive. Won't be doing the same and I think I won't revisit this site for a while to keep my sanity. I agree with much that is said about the company's fundamentals and potential moving forward. I am not an options trader so I really gain no insight by visiting daily, I just increase my anxiety. Hopefully see you back on the 27th to share a celebratory glass of champagne with you all!
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Post by tuffett on Jan 6, 2016 10:23:17 GMT -8
Yep, nobody gives a shit about the cash because it's not flowing back to shareholders except for a paltry dividend. It needs to double, or triple. You think AAPL would be trading with a 6% yield? Not a chance.
No offense to Luckychoices and those others fortunate enough to hold this for decades (fantastic job!), but it is foolish to buy and hold this stock in this day and age. Even the most bullish bull should now realize the cyclical nature of the stock and the fact that a couple of negative news articles will trigger a selloff that often leads to a 30-40% correction. Even someone with complete faith in the company would be wise to sell at the first indication of this. Of course, this creates a positive feedback loop and that's what we're seeing today - even those who don't buy into the rumours are hesitant to get into the stock: We are the last ones left holding the bag.
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Post by sponge on Jan 6, 2016 10:26:11 GMT -8
True. The buybacks haven't done much to increase the share price either. It's clear that everyone sees the cash hoard as wasted talent and not as an asset. I wish Apple had bought out some companies instead. It still can. Agree that the buyback have been a waste. I wish they would have kept the money - at a certain point the cash price will exceed the market cap and the value would be impossible to ignore. I think if we did not have the buyback we would be seeing a p/e of 9. The reason the buybacks have limited affect is because they have limited cash in the US. When tax laws change in the next 4-6 years we will benefit even more. Time is on our side. With each passing year the brand is getting stronger and our base is getting larger.
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Post by Volvocoupe on Jan 6, 2016 10:28:25 GMT -8
Bought my first shares in 2009 and foolishly sold them in spring 2013 pretty much near the bottom at $365 pre-split when it looked like aapl was in a dive. Won't be doing the same and I think I won't revisit this site for a while to keep my sanity. I agree with much that is said about the company's fundamentals and potential moving forward. I am not an options trader so I really gain no insight by visiting daily, I just increase my anxiety. Hopefully see you back on the 27th to share a celebratory glass of champagne with you all! I very much understand what you are saying here tricouleur. Don't blame you. Just put in a GTC order for 30 days to buy 3500 shares at $93. Will be happy to get filled Keep your sanity, you are wise.
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crispin
Member
KBJ for the win. AAPL long and strong since 2000
Posts: 311
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Post by crispin on Jan 6, 2016 10:28:44 GMT -8
True. The buybacks haven't done much to increase the share price either. It's clear that everyone sees the cash hoard as wasted talent and not as an asset. I wish Apple had bought out some companies instead. It still can. Agree that the buyback have been a waste. I wish they would have kept the money - at a certain point the cash price will exceed the market cap and the value would be impossible to ignore. Far too soon to make any definitive statements about the buybacks. For one thing, who knows how much worse this "correction" would be without them? Over the long haul I think they'll be viewed very favorably as the float is gradually reduced and the EPS benefits. When the stock is being barraged by relentless FUD it's easy to decry everything Apple is doing as a failure. It's the negativity snowball effect. But I wouldn't jump to condemn the buybacks as a waste at this early stage.
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Post by Volvocoupe on Jan 6, 2016 10:31:06 GMT -8
Agree that the buyback have been a waste. I wish they would have kept the money - at a certain point the cash price will exceed the market cap and the value would be impossible to ignore. Far too soon to make any definitive statements about the buybacks. For one thing, who knows how much worse this "correction" would be without them? Over the long haul I think they'll be viewed very favorably as the float is gradually reduced and the EPS benefits. When the stock is being barraged by relentless FUD it's easy to decry everything Apple is doing as a failure. It's the negativity snowball effect. But I wouldn't jump to condemn the buybacks as a waste at this early stage. More wisdom. Nice to see you post Crispin.
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Post by tuffett on Jan 6, 2016 11:03:44 GMT -8
The buybacks are not a waste but in my opinion they should be used more strategically. No need to buy back $5B every quarter - earmark it for downside protection. This way you protect your shareholders against large swings and you also ensure that you're at least not buying at relative highs. And if the stock keeps going up without much chance to buy back many shares - great, more money to increase the dividend.
The rest of the money should go to a bigger dividend. Even if some cash needs to be repatriated, shareholders need a reason to hold. Apple's cycle of high growth / low or no growth isn't comforting and doesn't afford them a good valuation.
At Apple's rate of FCF generation they should be doing a lot more with their cash. It seems to have zero value right now.
And yes, I do realize I am lashing out a bit because of where the stock is, but I think my points are valid nonetheless.
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Post by dreamRaj on Jan 6, 2016 11:12:08 GMT -8
No, the buybacks haven't been an actual 'waste'. They've helped us from a free fall. But while the float has decreased they haven't helped much in raising the share price.
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Post by chasmac on Jan 6, 2016 11:29:45 GMT -8
No, the buybacks haven't been an actual 'waste'. They've helped us from a free fall. But while the float has decreased they haven't helped much in raising the share price. The question is, how low can the P/E ratio go? Historical chart
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Post by nwjade on Jan 6, 2016 11:33:47 GMT -8
The buybacks are not a waste but in my opinion they should be used more strategically. No need to buy back $5B every quarter - earmark it for downside protection. This way you protect your shareholders against large swings and you also ensure that you're at least not buying at relative highs. And if the stock keeps going up without much chance to buy back many shares - great, more money to increase the dividend. The rest of the money should go to a bigger dividend. Even if some cash needs to be repatriated, shareholders need a reason to hold. Apple's cycle of high growth / low or no growth isn't comforting and doesn't afford them a good valuation. At Apple's rate of FCF generation they should be doing a lot more with their cash. It seems to have zero value right now. And yes, I do realize I am lashing out a bit because of where the stock is, but I think my points are valid nonetheless. Right there with you on this and your previous post. I would add I don't think you'll see a significant one time dividend increase until tax reform happens and offshore cash is repatriated at a reasonable (15%?) rate. If that happens Apple could pull another stunning move like the 7:1 split, jacking the dividend and the buyback. I hope they're thinking along these lines just biding their time. I also hope they not only focus on the stickiness of the ecosystem for success but think about ways to create investor stickiness as well.
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Post by Volvocoupe on Jan 6, 2016 11:35:16 GMT -8
No, the buybacks haven't been an actual 'waste'. They've helped us from a free fall. But while the float has decreased they haven't helped much in raising the share price. The question is, how low can the P/E ratio go? Historical chartHighest I have personally seen was around 54. Lowest I have seen was 8.9 a couple of years back when the stock was around $385 pre split.
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Post by dreamRaj on Jan 6, 2016 11:50:03 GMT -8
0h no, oh no, oh no... 100.01
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Post by archibaldtuttle on Jan 6, 2016 11:51:22 GMT -8
Highest I have personally seen was around 54. Lowest I have seen was 8.9 a couple of years back when the stock was around $385 pre split. By every measure the stock valuation is lower than it has ever been while Apple has still been growing EPS year-over-year. The PE was slightly lower in 2013 when EPS was falling y/y. But FCF/share is even less now than it was then. "The buyback has prevented a free fall"... If this is not a free-fall, I don't know what is.
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Post by rob_london on Jan 6, 2016 12:09:05 GMT -8
Weird synchronicity in the share prices of AAPL and DIS today.
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mark
fire starter
Posts: 1,552
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Post by mark on Jan 6, 2016 12:19:08 GMT -8
Weird synchronicity in the share prices of AAPL and DIS today. Ha. Except DIS trades at a P/E > 20 right now!
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Post by vikesfaniv on Jan 6, 2016 12:22:41 GMT -8
I think the time may be here to switch from massive buybacks to massive dividends. With a buyback you can increase your EPS, but as this decline illustrates, the PE can just compress and not help the stock price. However, with dividend, that is real money. Imagine how many people would be buying shares if AAPL is giving a 5 or 6% yield (or even higher). I think that would give much better support to the stock than artificially increasing EPS through buybacks
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Post by rob_london on Jan 6, 2016 12:32:01 GMT -8
Weird synchronicity in the share prices of AAPL and DIS today. Ha. Except DIS trades at a P/E > 20 right now! Unfortunately true. As we all know very well, AAPL is incredibly cheap right now. Price/ FCF ratio = 8.5. FCF yield = 11.0
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Since84
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Post by Since84 on Jan 6, 2016 12:33:45 GMT -8
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Since84
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Post by Since84 on Jan 6, 2016 12:36:15 GMT -8
Notice that someone bought a lot of shares when AAPL briefly dipped below $100.
What is the legal limit to Apple's share repurchase on a given day? 5% of trading volume?
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Since84
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Post by Since84 on Jan 6, 2016 13:06:35 GMT -8
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Post by rickag on Jan 6, 2016 14:14:46 GMT -8
Agree that the buyback have been a waste. I wish they would have kept the money - at a certain point the cash price will exceed the market cap and the value would be impossible to ignore. Far too soon to make any definitive statements about the buybacks. For one thing, who knows how much worse this "correction" would be without them? Over the long haul I think they'll be viewed very favorably as the float is gradually reduced and the EPS benefits. When the stock is being barraged by relentless FUD it's easy to decry everything Apple is doing as a failure. It's the negativity snowball effect. But I wouldn't jump to condemn the buybacks as a waste at this early stage. Well said
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Post by sponge on Jan 6, 2016 14:34:17 GMT -8
If Apple were to buy back 5% every year for the next 7 years, they would have bought back half the company.
The savings in dividends would be amazing. We are looking at $15 billion a year if they raised it only 15% per year.
I think the yield would still remain at 2%.
Then in 2023 we start to income truly take off from the Apple Car, Search, Apple Pay, and Health.
They can start to increase dividend to their hearts content.
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Since84
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Post by Since84 on Jan 6, 2016 14:38:41 GMT -8
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Since84
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Post by Since84 on Jan 6, 2016 14:47:57 GMT -8
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JDSoCal
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Aspiring oligarch
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Post by JDSoCal on Jan 6, 2016 16:21:21 GMT -8
Oh goodie, two of my favorite things, CNBC and technicians. If only there were teats on a boar in that link, and we'd have my trifecta of useful investing things.
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Since84
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Post by Since84 on Jan 6, 2016 16:46:19 GMT -8
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Since84
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Post by Since84 on Jan 6, 2016 16:50:44 GMT -8
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