Apple's Stock Soars Past $1,000 Pre-Split Price as Bulls Think 'Golden Opportunity' to Buy Remains

[Carnegie]

I found this article on Apple stockholders at the time of the IPO:

https://www.quora.com/How-much-equi...O-Did-he-really-have-double-the-equity-of-Woz

Of some interest, the single individual largest stockholder was Steve Jobs. Markkula was second and Wozniak was third. But the largest block by far was "all officers and directors."

That's right: By the time of Apple's IPO, Mr. Jobs held the most shares followed by Mr. Markkula and then Mr. Wozniak. That officers and directors block that you refer to included the shares held by those three as well as Mike Scott and some of the other individuals listed. The unlisted officers and directors actually held, in the aggregate, less shares than those listed.

Early on Mr. Jobs, Mr. Wozniak, and Mr. Markkula each owned 260,000 shares. Mr. Scott and Fred Holt were also able to buy in, for 40,000 and 25,000 shares respectively, at (or very near) that early valuation of 35 cents per share. But by the time of the IPO those shares had been diluted such that, collectively, they represented only a little more than 50% ownership of the company. They were diluted by additional equity fundraising and, notably, a significant amount of both exercised stock options and outstanding stock options.

Mr. Scott and Mr. Holt had added to their ownership share of the company by the time of the IPO by buying more shares and, in Mr. Holt's case, exercising options. (Mr. Scott also got rid of a small portion of his shares before the IPO, not sure about Mr. Holt.) The other three had, to different degrees, reduced their ownership share (beyond the reduction caused by dilution) by selling or giving away shares.

Adjusting for pre-IPO splits, each of those three started with 8.32 million shares. By the time of the IPO Mr. Jobs and Mr. Markkula still held the great majority of theirs - 7.5 million and 7.0 million respectively. Mr. Wozniak held just shy of 4 million shares. His wife, whom he was separated from, held another 1.2 million.

At the close of Apple's first day of trading, Mr. Jobs' shares were worth more than $200 million. Today they would be worth more than $60 billion.

 

[Pootie Tang]

You have a very short memory as the market has pumped and dumped Apple stock several times of the years.
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Apple stock is not risk free for people buying in now. You bought in when the price was very low so you can't lose, but for those buying now any downward move in the stock price would easily outweigh the quarterly dividend payments.

Apple are basically a one product company now. If one day the iPhone stops selling so well, Apple has nothing else capable of making up the numbers. Also, if Trump follows through on his promise to slap import duties it could hit iPhone sales.

In 2016 60% of Apple's revenue came from I-Phones and 40% came from services, computers and other products plus licensing.
In January of 2016 APPL was selling at less than $100 a share. Today its at $144. There is nothing wrong with buying APPL in anticipation of the Fall release of I-Phone 8, that one big product, and then getting out after the reviews from its release. Not everyone needs to be a long term investor in order to make money.

 

[firewood]

but for those buying now any downward move in the stock price would easily outweigh the quarterly dividend payments.

However, assuming the efficient market hypothesis, and as a component of a decently diversified portfolio, the risk of downward price movement should be offset by a roughly equal risk of upward price movement plus the less risky dividend.

So sure, everything that goes up must come down (even satellites after the sun becomes a red giant), but one saying is that "the market can stay irrational longer than you can stay solvent".

 

[IJ Reilly]

At the close of Apple's first day of trading, Mr. Jobs' shares were worth more than $200 million. Today they would be worth more than $60 billion.

And as we know, Steve Jobs sold all but one share when he was fired, using the capital to fund NeXT, and later to buy Pixar. NeXT would have almost certainly gone bankrupt had it not been purchased by Apple, and Apple was on the ropes until Jobs resumed control of the company he'd nearly ruined. Thus Jobs became a billionaire all over again. If anyone had written this storyline as a work of fiction it would be dismissed as completely implausible.
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However, assuming the efficient market hypothesis, and as a component of a decently diversified portfolio, the risk of downward price movement should be offset by a roughly equal risk of upward price movement plus the less risky dividend.

So sure, everything that goes up must come down (even satellites after the sun becomes a red giant), but one saying is that "the market can stay irrational longer than you can stay solvent".

I do like that. We are forever hearing about how we should look for "undervalued" stocks. Are they still undervalued if the market never agree with your valuation assessment? The bottom line is, the market may not always be right, but it is always the market.

 

[firewood]

And as we know, Steve Jobs sold all but one share when he was fired, using the capital to fund NeXT, and later to buy Pixar. NeXT would have almost certainly gone bankrupt had it not been purchased by Apple, and Apple was on the ropes until Jobs resumed control of the company he'd nearly ruined. Thus Jobs became a billionaire all over again. If anyone had written this storyline as a work of fiction it would be dismissed as completely implausible.

Furthermore, Jobs sold his entire monster position in AAPL stock, now valued at around $60B at somewhere around 25 to 30 cents per today's share (as adjusted for the post-IPO splits), except for 1 share. When offered huge stock options after becoming CEO, he took a Gulfstream jet instead. But if Amilio had stayed in charge of Apple instead of the return of Jobs, Apple may well have gone the way of all the other giants in the original PC industry, Radio Shack, Commodore, and Atari ... all the way to essentially a zero market cap today. And Jobs would have still remade his fortune from the IPO of Pixar.

 

[IJ Reilly]

Furthermore, Jobs sold his entire monster position in AAPL stock, now valued at around $60B at somewhere around 25 to 30 cents per today's share (as adjusted for the post-IPO splits), except for 1 share. When offered huge stock options after becoming CEO, he took a Gulfstream jet instead. But if Amilio had stayed in charge of Apple instead of the return of Jobs, Apple may well have gone the way of all the other giants in the original PC industry, Radio Shack, Commodore, and Atari ... all the way to essentially a zero market cap today. And Jobs would have still remade his fortune from the IPO of Pixar.

Spindler, Amelio, they were dead men walking. When I bought in, a couple of potential buyers were sniffing around. One was Sun Microsystems (cue the ironic music). Supposedly they even made the board an offer.

 

[dan110]

Actually APPL stock has had a long, slow, fairly steady climb for about five years now. I'm an Apple investor so I've tracked the stock on a daily basis for many years.
Just Google "Apple five year chart" and you'll see nothing that resembles a "pump and dump" pattern. The entire stock market has been in a bull market for eight years, the third longest run in history and APPL's growth patterns are consistent with the market as a whole.
"The Bull Market Just Turned Eight; Apple has surged more than 1,080 percent"
http://www.valuewalk.com/2017/03/bull-market-just-turned-eight-apple-surged-1080-percent/
The numbers speak for themselves. But perhaps there's been eight years of pumping and we're still waiting for the dumping.

Two things to factor in the effect of inflation and the fact that the entire stock market is grossly overpriced.

 

[oftheheavens]

Plus the dividends you'd be raking in!

Drip lemon on the wound as you grind in the salt -.-

 

[fhall1]

LOL - sorry

 

[Pootie Tang]

Two things to factor in the effect of inflation and the fact that the entire stock market is grossly overpriced.

The rate of inflation has been low for many years now. There was 3% inflation in 2011 and nearly 4% in 2008, other than those years inflation has been around 2% or less. Contrast that with 11% inflation in 1974.
Because of this thread, I went and looked at my personal history as a small investor with Apple. I bought my first shares in 1999, 25 shares at 91.31. Over the years I spent about $11,000 on Apple Stock and Apple has paid me $20,000 in quartlerly dividends.