Apple Inc. (AAPL)
Despite very nice earnings and pretty reasonable P/E 16, AAPL is practically flat YTD. What do you think about Apple's future?
They need to keep pumping out blockbusters to maintain their earnings... hence multiple compression. Android is going to put some serious pressure on iOS device sales. Will people pay twice as much for half the device just for half-eaten fruit logo? Some will, but enough to justify a $300 billion market cap?
Yes, in some cases they will... maybe not good example , but why people buying Malrboro or Parlament, Pepsi or Cola - even though local brands maybe not worse and cheaper...
Originally Posted by andrewf
Again, last Q AAPL had a huge profit and stock practically unchanged.... I just don't understand
I haven't looked at the stock, but i suspect that the stock price currently implies a very high growth rate. Apple has the market cornered in many of its segment, however, as a leader, it will be the first to lose market share with the increase competition.
What are the chances you will double your money on the stock ? Practically 0 given the 300B market cap.
I just looked at the chart on Google Finance ... the YTD chart is an interesting roller coaster. Someone could probably buy in at the 320-325 and ride it until the 350 ... the support / resistance levels are pretty evident, 7-8% gain.
If you're looking for long term hold, this probably isn't the best choice. No dividend and limited growth (my opinion) given current market cap and competition.
If I were to buy this stock, I'd wait for the next major plunge and then hold for the long term. Everyone predicts the stock will tumble when Steve Jobs eventually dies, which hopefully won't be for many years but his health remains precarious. Many people believe Jobs is the driving creative force at Apple, but he has never actually done any programming or designed a product. He plays a major role in product development of course, but he has worked hard to ensure that Apple will remain in good hands after he's gone.
Originally Posted by phrenk
One thing to consider is that Apple products tend to be popular with baby boomers, and the growth rate of the elder population will double over the next 20 years. Apple still has a lot of room for growth in the PC market, the software market, and other markets that we haven't even dreamed of yet because Apple will create them. I agree that they'll lose market share in the phone market and eventually the tablet market, although Apple has a strong headstart on tablets and the iPad is already making significant inroads in the corporate and scientific markets.
Apple has never gone for market share. They price their products high and go for the premium buyer. As a result, there will be lots of opportunity for Google and RIM and Motorola and Nokia, maybe even MS to compete at the low end. Their trailing PEG is 0.7 and anything under 1.0 is usually a safe bet.
I agree that you can make a lot trading on the swings. They have always had a volatile stock price. And their returns this year, especially in C$, are mediocre.
Except in the tablet market, where nobody has yet to offer anything comparable at their price point. Their PCs aren't cheap but in some cases are cheaper than PCs from Lenovo or even Dell with comparable specs -- it's just that Apple's specs are on the high end in terms of speed, storage, graphics cards, etc. so they're competing in the medium to high end of the market for people who need serious tools.
Originally Posted by kcowan
^ Spin alert.
Apple's Quad core workstation:
One 2.8GHz Quad-Core Intel Xeon "Nehalem" processor
3GB (three 1GB) memory
1TB hard drive 1
18x double-layer SuperDrive
ATI Radeon HD 5770 120 with 1GB GDDR5
Any way you slice that, it's overpriced. Only 3 GB of RAM?
iPad/iPad 2 are genuinely nice devices. Apple created the market and has first mover advantage. Already though, other makers are putting out devices with superior specs around the same price point. In two years it'll be a massacre.
Last edited by andrewf; 2011-05-17 at 01:44 PM.
But that's their most expensive machine. The new iMac actually now has comparable specs for $1,200. (everyone expects Apple to either discontinue the Mac Pro or come out with a far more souped-up version).
Originally Posted by andrewf
The base model iMac comes with 2.5GHz quad-core Intel Core i5 with 6MB on-chip shared L3 cache, 4 gigs of RAM:
And that price includes a 21 inch monitor.
A couple of years ago when I shopping for a laptop I priced out a MacBook Pro and compared it with comparable models from Lenovo and Dell. The Lenovo laptops with the same specifications were about $100 more than the Mac, and I only found one Dell model that was cheaper.
Actually, their most expensive machine seems to be a 12-core server/workstation for $5199.
The base Mac Book
2.4GHz : 250GB
2.4GHz Intel Core 2 Duo
2GB DDR3 memory
250GB hard drive1
8x double-layer SuperDrive
NVIDIA GeForce 320M graphics
Built-in 7-hour battery2
Polycarbonate unibody enclosure
Available: In Stock
Only a 250 GB hard drive? Only 2 GB of RAM? A non-dedicated graphics set that only uses 256 MB of system RAM. Underspeced for the price. I will admit that they make nice chassis. Pity about those built in batteries. I bought a Dell laptop with similar or better specs 4 years ago for a bit less money!