More Apple Insanity

by,

Suzanne Coleman

So Apple reported it’s quarterly earnings this afternoon, and guess what?  They again blew away expectations beating both gross and net income.  Their profit surged 38%.  But traders sold the stock and caused it to plummet the instant the results were reported.  Why?

Insanity, that’s why.  The only valid negative in their report so far (which actually came AFTER the drop) was that sales were DOWN in China.  Now this is important as China was a major income source.  We don’t know why sales are down there, nor what it portends for the future of the market all-around.  But even with this negative, Apple’s earnings and sales were outstanding.  iPhone sales were up 35% to 47.5 million phones.  This is the main profit contributor.

Other items increased as well, including services (I believe this includes Cloud and Apple Pay), and the “other” category where they have currently placed the new product the Apple Watch.  They also added later that the Watch brought in more than one BILLION dollars in sales this reported quarter.

In the future, this growing and ridiculously financially-stable company will continue to do well.  So again, why are people selling it?  These people are likely day- or hour- traders who jump in and out of stock positions and disrupt the market at times with their actions.  Long-holding owners and institutions would be wise to buy in now.  I believe that it will go back up.

Its stable price point over the last several months has been $125-126.  It will return to that level, or more likely, surpass it to at least $128-129.  Analyst estimates should again rise after this report, likely up to $160.  So, again, why are people selling?  I guess we’ll just have to wait and see what happens.  These are generally the same people buying into stocks with outrageous PEs and no profits.  Speculators is what they are called, and sometimes they do very well, but other times, they are wrong.

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Yep, marketwatch.com (where I got the reported numbers above) just wrote that Piper Jaffray’s analyst Gene Munster raised estimates to $162.  4:29pm CST

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Apple’s Next BIG NEW IDEA

by,

Suzanne Coleman

I’ve got the inside scoop for you here, don’t miss out.

I found out through my secret connections that Apple was looking to purchase a big piece of property that it could use to expand its business further into Europe and the Middle East.  They also wanted to find land and facilities that would be useful for company retreats and vacations.

When reviewing the current opportunities, executives considered location, size and what the property would offer to them and their thousands of employees.  They also looked at possible tax breaks and other tax implications.  They currently have billions of dollars stashed in Europe because of tax advantages.

I gave Tim Cook a call and told him about what I thought was the perfect solution.  It offered everything they wanted, a central location in Europe and the Middle East, with good access to Western Asia and Northern Africa as well.  It was available at a deep discount, but offered vast lands and a vacation-like atmosphere.

I told Tim Cook that Apple should buy Greece.

And he agreed.

Not only would this acquisition solve Apple’s current needs, but it would help stabilize Europe’s economy and the US stock market.  It would also give Apple a seat at the European Union’s policy-making sessions, and that’s never a bad idea for a company who is looking to expand their business into an area.

Of course all of this is currently fictional (in case you weren’t sure), but I think it really is the best solution all-around to the current Greece debt issues, and Apple could certainly afford to do it.

If you like my idea and decide to go ahead with it Tim, all I ask is a 10% commission and that you save me a nice house with a sunset-view.  Let me know.

New Apple Watch Apps for Industry, Pretty Cool

by,

Suzanne Coleman, MD

I just came across this article and thought it was pretty interesting:

http://finance.yahoo.com/news/apple-ibm-release-three-apps-130150745.html

It talks about a few new apps for the Apple Watch.  One is for nurses which allows them to receive important info on patients.  I think that is a great idea, if it works well.  This might remove the need for those bells that are often ignored, and do more to disrupt other patients than help the one in need.  Instead a tap on the wrist saying “Hello!  I need you” will alert the nursing staff to a patient’s needs.  And since there is a speaker, why wouldn’t they be able to speak to the patient directly via the Watch?  Pretty cool development.  If they work well, I can see financially-capable hospitals equipping their staff with these Watches.

No one is buying Apple

by,

Suzanne Coleman

Thestreet.com reported today that Apple is in talks to bring Apple Pay to China, and part of their strategy is to work with Alibaba, China’s massive online store, similar to our Amazon.  But the stock hasn’t gone up in response to this news, why not?

Maybe it’s because everyone already thought this would happen.  That makes sense, since Apple is currently focused on expanding access for the Chinese to its products and services by opening many more stores in China.

It has been previously reported that Apple makes $0.10-0.15 PER Apple Pay transaction, that is a BIG deal.  With about 62 million current iPhone users in China*, this is a big future contributor to Apple’s bottom line.  If you guesstimated 30% of those iPhone owners used Apple Pay once every 2 days, you would end up with over $531,000 a day in revenue from Apple Pay in China alone.  And Apple is increasing the number of users there as we speak.  So, basically, it’s a big deal.  I have predicted that Apple will make major moves in the finance sector here:  [https://sliceiconic.com/2015/03/16/apples-future-domination-apple-watch-applebank-and-appleplay/].  We’ll see what happens.

Maybe Apple stock has been doing so poorly, relative to its actual performance as a BUSINESS, is because everyone/every institution who wants to own the stock, already does.  That would make sense.  Its price rises before earnings due to short-term buyers hoping to cash in on a quick up and down movement, and then it drops back down to almost where it was before earnings were reported.  I’ve written on this odd behavior of investors before, here: [https://sliceiconic.com/2015/01/27/reasonability/], where I discuss the reasonableness of PE ratios and investor behaviors.

What more is there to say?  Maybe the stock price hasn’t moved significantly because everybody is waiting to hear the numbers from the Apple Watch sales?  I don’t think that’s the case since most professionals have read the analysis which suggests that even if Watches are selling as expected, those sales won’t contribute significantly to the bottom line, for now.

I currently see Apple as “the new IBM.”  It’s become the “old stalwart” of the tech boom industry.  I guess 33-40% increases in profit year-over-year is a bit stale and dusty?  Right?

Anyone?

Bueller?

Its stock price barely moves in response to stellar quarterly reports on its performance, odd.  Am I the only one who thinks this way?  Oh, no, wait, I’m not.  There is that famous guy, what’s his name?  Carl Icahn.  Yeah… maybe we’ve both got it wrong.  🙂

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NOTE:  This writer owns shares of Apple stock though she’s not really sure why anymore…

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*Based on estimates of 520 million smartphone users and a 12% market share as reported by cnet.com here:  http://www.cnet.com/news/china-likely-to-top-us-for-apple-iphone-sales/

Apple’s Earnings are out, and they’re good

by

Suzanne Coleman

According to thestreet.com’s live blog (which was the first to release the numbers this afternoon), Apple reported the following for its second quarter earnings:

earnings:  $2.33/share

revenue:  $58 billion

Sales, in millions:

iPhones   61.2

Macs  4.6

iPad  12.9

Watch not reported

Capital return program increased to $200 billion which increases the dividend to 52 cents per share.

The earnings, revenue and capital return program all beat expectations.  Earnings were expected to be $2.16 and revenue $56.06 billion.

Apple was up to $135 or so after the report and has pulled back slightly now to 134.40.

iPhone sales were 40% over last year’s sales per Brandon Bailey at AP.  Last quarter was also a 40% increase in sales, overall.  So that would put the stock on track to be currently priced at around $137 per share.

The Apple Fail

by,

Suzanne Coleman

[Ok, I wrote this about a week or so ago, when they reported the delays in delivery for the Apple Watch, but since I didn’t publish it, I’m doing it today.  The analysis is still relevant.  Only time will tell if this new product release method that Apple employed will work or not, though I’m thinking it certainly isn’t be the ideal way to do things.]

I’ve got to say, when you pay someone 75 some million dollars because they’re “Just so awesome” to get them to come to your company and work, you’d probably think they wouln’t completely f@%* up your business, wouldn’t you?  Well, that’s what is happening now, or so it seems.

It’s the Apple Fail, not the Apple Watch.

Telling your customers that your BIG NEW PRODUCT is going to be available on April 24th, and then failing to have product available?  Wow, that’s the kind of company that quietly disappears from the news as it goes out of business.  That is such a huge strategic FAIL I don’t know what to say.

Not only do they not have product available for sale, they are telling people who already paid for the product that they will have to wait MONTHS to get it!  WHAT?!@  Omg, Apple, I am so not happy.

And during the run-up campaign to the release for the Apple Watch, having major news outlets telling the public that the watch CANNOT BE PURCHASED in the store?  Seriously?  Who’s in charge there?  I mean, I caught the error, nobody at Apple did?  Hmm…  Obviously people who went into the stores WERE able to buy it online while in the stores.  How many didn’t even bother going because they weren’t interested in being jerked around?  Yeah, I wonder.  The kind of people who might pay $10,000 for a device, that’s the kind of people who aren’t really into being jerked around, and probably a few others as well.

And now they are saying that deliveries might not have such huge delays after all.  What to believe?  Like Taylor Swift said: “This is exhausting.”

I know they have pulled this availability manipulation before, and it didn’t destroy the company, so maybe people find it attractive and charming, kind of like playing hard to get?   But that kind of selfish, manipulative behavior generally tends to push people away…

 

NOTE:  I own Apple stock, and I expect the same thing from them that I do from any company that I work with/interact with:  quality customer service, ethics, reliability, responsibility, quality products, etc.

After their stock’s performance this quarter, I’m not sure I’ll still be adding this note to my posts… see Amazon, Netflix, YY, Starbucks, Qihoo, Tesla…

Apple Watch, New Ads, Nicely Done

By,

Suzanne Coleman

Just found this article:

http://fortune.com/2015/04/24/hats-off-to-angela-ahrendts/?xid=yahoo_fortune

where you can watch the three new Apple Watch ads.  It’s funny because just last night I was thinking they needed to do ads with a human experience aspect, and voila, there they are!  Nicely done, too.

After I watched the last one, I said to myself, I need that watch!  Seriously.

NOTE:  I own Apple stock, but this wasn’t biased by that.

Apple to Report Earnings Monday after close

by,

Suzanne Coleman

Apple’s post-holiday quarter earnings to be released this coming Monday after market close.  I think share price will rise to $142.

Apple Watch Sales

by,

Suzanne Coleman

Well, Apple is keeping us in suspense again.  After they sold out of all the available Watch units on the first day of sales this past Friday, at least a few people (myself included) have been wondering, well, “HOW MANY DID YOU SELL?”  Apple hasn’t said even a peep about that, yet.

With the sell-out occurring in the first 10-30 minutes of availability (depending of which article you read), I’d guess they had to sell 3-5 million units.  Now mind you, this is an educated guess only.  I just read an article which noted 1.2 million possible units were sold, but only to US buyers (“Investors’ Business Daily” and “Fortune”).  Extrapolate that to the world, and I think you’d likely land in my estimated range of sales.  Just imagine how many will sell AFTER the first 24 hours?

Were all of those naysayers (not sure what their problem is, but they seem to have one) wrong?  We’ll soon find out.  Stay tuned!

Apple Online Store, Delayed Opening for the Apple Watch but now Open

by,

Suzanne Coleman

Well I was getting worried when it was 2:01am CST and the online Apple Store was still not open.  Finally around 2:14am I was able to see the Apple Watch preorders page instead of the multi-lingual (for the us site?) flashing statement that they weren’t open yet.  I hope this delay doesn’t portend future problems with the rollout of this and other products.

Now we just have to wait and see how many watches sell, and how people adopt them into their lifestyles.  This should be fun!

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NOTE:  I own Apple stock.

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