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Roundup of Analyst Expectations Ahead of Q2 2013 Earnings Call
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Of course by just right I meant that the 700+ price it had in September was ridiculous. I was responding to the guy who asked me why I think the price should keep growing exponentially when apple is not growing exponentially. Not sure where your confusion on my statement came from.
As for the second part, yeah let's leave it at that.
You are assuming a stock price is driven by some rational criteria, it is not. Look at Amazon (P/E Undef) or Facebook (P/E 1,500ish). Amazon is "expected" to show a profit last quarter, but it is only expected to come in around .09 billion. I believe that puts their P/E a lot closer to Facebook than to Apple's P/E of ~9. Neither one of those stocks is priced on expectations for the next 5-10 years, let alone the next 3-6 months. What are they based on? Trading driven by pros fleecing amateurs on popular stocks.
It is easy to see Apple as undervalued today versus what the company may be worth in 10 years. No rational person can say that about Facebook or Amazon.
Google is one of the most reasonably priced tech stocks today. If Apple was trading at their P/E of ~27, the share price would be around $1,200 and the market cap would be over $1 trillion. Google is not growing or growing growth any faster than Apple. Where is the sense in that?
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Because even without any growth at all, it has a P:E of 9, and that's not even factoring in the cash slush pile. It is irrational, unless you expect not only a lack of growth, but a severe contracture in earnings. Not likely.
Of course by just right I meant that the 700+ price it had in September was ridiculous. I was responding to the guy who asked me why I think the price should keep growing exponentially when apple is not growing exponentially. Not sure where your confusion on my statement came from.
As for the second part, yeah let's leave it at that.
You aren't following. The function of markets is to set prices. So by definition, whatever the price is now, that is the right price. Anything else is just theoretical. So when AAPL was at $700, that was the right price at that time, based on what investors knew and expected about the future. Instead of good things happening, the news since then has been mostly negative. In reality, markets tend to overreact on both the optimistic and pessimistic side, so while $700 based on current earnings might have been overly optimistic, the question remains whether $400 is overly pessimistic based on future earnings. The answer to that question we will not know until after the fact.
: AAPL reports EPS $10.09 vs. $10.10 ; Revenues $43.6 vs. $42.75B
Buyback of $60 Billion.
dividend upped 15%
Buyback of $60 Billion.
dividend upped 15%
Not really. During the mid-2000s AAPL was selling at PEs in the 70-100 range. And what was the basis for these high multiples? Expectations of growth. Were those expectation fulfilled, or no? Did investors who bought at those multiples get fleeced?
No rational person, indeed.
"Mr. Cook, we heard that you're planning to sell an iPod on a wrist band... True or false, sir?"
About 2% above the Street on EPS. Not great, but not terrible. Not as bad as the last two quarter anyway. Setting the dividend at around 3% should make some investors happy.
Uh, I neither implied nor stated anything regarding Apple's last Q, just stated a basic generic investment fact. Don't be so quick to rush in to comment.
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True. Nothing is forever. That's why stock that go up usually also go down. Thanks for pointing out the obvious.
Not me, Captain. Sorry, your witness picked out the wrong guy of in the lineup of usual suspects.
I understand your basic investment fact, just wanted to point out that growth alone isn't necessarily enough to please investors (as proved by past quarters). They also have to maintain a growth growth. Your original comment only mentionned growth, which happened in previous quarters when the stock dropped.
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