Since84
Moderator
To infinity and beyond!
Posts: 3,933
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Post by Since84 on Jan 18, 2016 3:03:40 GMT -8
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Since84
Moderator
To infinity and beyond!
Posts: 3,933
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Post by Since84 on Jan 18, 2016 4:16:03 GMT -8
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Post by rob_london on Jan 18, 2016 5:56:49 GMT -8
Words of wisdom from Howard Marks of Oaktree: "Especially during downdrafts, many investors impute intelligence to the market and look to it to tell them what’s going on and what to do about it. This is one of the biggest mistakes you can make. As Ben Graham pointed out, the day-to-day market isn’t a fundamental analyst; it’s a barometer of investor sentiment. You just can’t take it too seriously. Market participants have limited insight into what’s really happening in terms of fundamentals, and any intelligence that could be behind their buys and sells is obscured by their emotional swings".
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chinacat
Moderator
AAPL Long since 2006
Posts: 4,429
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Post by chinacat on Jan 18, 2016 7:24:43 GMT -8
OK, it's "Stupid Question From Chinacat" time! In the weekend thread, bloodylongaapl posted a note about FX rates weighing on Apple's results. Tim has been commenting on that also recently, which certainly supports the thesis.
Here's what I don't fully understand. Doesn't a strong dollar work in Apple's favor for paying all of their overseas suppliers and manufacturers? So I guess the net-net depends on the mix between that and the effect on sales due to higher costs for overseas customers. Would someone be kind enough to explain what mix of these factors determines whether this is a net negative or positive for Apple at any given time?
Bowing my head in memory of MLK, one of the great Americans of the 20th century.
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Post by tuffett on Jan 18, 2016 10:05:24 GMT -8
Look at it this way. Their revenues are far, far higher than their capex costs. So any negative FX impact on revenues (and thus profits) far outweighs the smaller cost savings on capex. The high USD is now a serious problem for US multinationals. I think it's worse than AAPL would had forecasted (and they can only cost-effectively hedge so much anyway), and it makes me very worried about FQ2 guidance. FX may be a significant factor if iPhone sales are indeed less than previously forecast. iPhone demand is certainly less sensitive to price than for other products but it definitely isn't price inelastic either.
Hopefully the Fed wakes up and either holds here or reverses course. There's no way they should be increasing rates 1% a year when the rest of the world is devaluing their currency as quickly as they can.
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Post by rickag on Jan 18, 2016 10:08:31 GMT -8
OK, it's "Stupid Question From Chinacat" time! In the weekend thread, bloodylongaapl posted a note about FX rates weighing on Apple's results. Tim has been commenting on that also recently, which certainly supports the thesis. Here's what I don't fully understand. Doesn't a strong dollar work in Apple's favor for paying all of their overseas suppliers and manufacturers? So I guess the net-net depends on the mix between that and the effect on sales due to higher costs for overseas customers. Would someone be kind enough to explain what mix of these factors determines whether this is a net negative or positive for Apple at any given time? Bowing my head in memory of MLK, one of the great Americans of the 20th century. good question. my 2¢ Yes Apple gets more bang for the buck buying parts and labor. But each phone sold in China and outside the US returns less dollar value unless Apple raises prices. Apple also hedges currency, hope they upped the ante significantly. Someone more knowledgable should easily be able to explain better than me. edit: I see tuffett has already made a much better explanation.
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Post by archibaldtuttle on Jan 18, 2016 11:33:42 GMT -8
The coverage of Apple is just so ridiculous. I believe Apple grew their earnings last year more than the "fast-growing Facebook" they refer to.
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Post by sponge on Jan 18, 2016 12:35:13 GMT -8
The coverage of Apple is just so ridiculous. I believe Apple grew their earnings last year more than the "fast-growing Facebook" they refer to. The selling happens to coincide with the 20 crossing the 50 and then a few weeks later dropping below the 200. Excellent use of TA to get out at the right time.
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Post by bloodylongaapl on Jan 18, 2016 13:12:44 GMT -8
Back to FX, I also believe many if not most supplier prices are negotiated and paid in USD. So the exposure on revenue is not offset by much if any benefit to materials supply costs. I'd be happy to be corrected on this, and don't have evidence to hand.
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Post by sponge on Jan 18, 2016 13:59:31 GMT -8
The article mentioned the time span which the same time as the moves I mentioned.
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Post by tuffett on Jan 18, 2016 16:59:13 GMT -8
So Donald Trump is going to get Apple to manufacture in the US, or charge them a 35% tax. This guy makes George Bush look like a genius.
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Post by Luckychoices on Jan 18, 2016 17:30:07 GMT -8
The coverage of Apple is just so ridiculous. I believe Apple grew their earnings last year more than the "fast-growing Facebook" they refer to. The selling happens to coincide with the 20 crossing the 50 and then a few weeks later dropping below the 200. Excellent use of TA to get out at the right time. Huh? The selling happens to coincide? Three large growth funds sell millions of shares of AAPL over the last 6 months and it's because they used TA to tell them to get out at the right time? How about this instead? Three large growth funds used TA to decide to sell millions of shares of AAPL, thereby contributing to increased (even panic) selling as other holders of AAPL saw the price dropping because of the millions of shares flooding the market. Queue the analysts to start the scare stories about fewer iPhones being sold next quarter to further the selling and shake out any "weak hands" remaining. Call me a non-believer if you must, but I think the funds unloading millions of shares of AAPL over the last part of 2015 played a bigger part in pushing the stock price down to where it is today than did TA. From servo's link: "Growth funds dumping Apple stock as iPhone sales seen sagging; value-managers moving in" www.reuters.com/article/us-apple-funds-iphone-idUSKCN0UT246?type=companyNewsThe Fidelity, American Fund Capital and Hartford Capital growth funds were among the ten largest sellers of Apple over the last six months of 2015.
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Post by chasmac on Jan 18, 2016 18:27:12 GMT -8
So Donald Trump is going to get Apple to manufacture in the US, or charge them a 35% tax. This guy makes George Bush look like a genius. He doesn't buy his wives in the U.S.
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Post by sponge on Jan 18, 2016 18:40:56 GMT -8
It was June 28 when the selling caused the 20 to drop below the 50. I saw it but did not sell because I thought for sure we would recover. We Did muster a small come back to 132 in July but the warning signs were there and the selling just kept going. Institutional ownership started to drop from 61.5 to 59.7.4. That's 114 million shares being sold off. The article only talked about a few million shares. Add the retail crowd and now we are at 97.
I am sure the same funds will slowly start to buy back this week. Perfectly executed swing trading plan. The FUD about China dropped us below 200. It was proven wrong but the damage was too great. Get back in when the 20 crosses the 50. We did in October but only got to 123. We crossed the 50 again at the beginning of Dec around 115. A second chance to get out, but did not believe it again.
By the way after dropping below the 200, one should be in cash only as far as I am concerned. Don't get back in until we go above 200 and hold it. Back in 2012 we did so at 585. When we went back over we were around 400.
It does not matter what the profits or iPhone numbers are. Once the FUD causes the panic you have to ride it out or get out and wait. WS won't care that they were wrong, because they made millions and that is what counts. Retail is just too easily panicked when they own 41%.
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JDSoCal
Member
Aspiring oligarch
Posts: 4,183
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Post by JDSoCal on Jan 18, 2016 23:45:28 GMT -8
So Donald Trump is going to get Apple to manufacture in the US, or charge them a 35% tax. This guy makes George Bush look like a genius. It would be very interesting to see Tim "Social Justice" Cook explain to a Republican why Apple can't afford US minimum wage and other insurmountable regulatory hurdles that are preventing iPhones from being assembled in the US. #InconvenientTruth
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