January 2, 2014

December 23, 2013


After the fall in Apple’s stock value when the China Mobile failed to materialise as expected on 18th December, yesterday’s news that the deal had finally been concluded sent the stock shooting back up again, having climbed more than 3 percent at the time of writing (it was up 4% in pre-market trading but has settled).

With the WSJ having reported that 18th December was the day, the market was clearly jittery when nothing materialized. Everything had appeared to be in place: regulatory approval, Apple putting the handsets on sale in China on the opening weekend, China Mobile posters, a pre-order website, in-store displays – and 4G service up-and-running on schedule …  expand full story

December 18, 2013

AAPL stock took a 1.8 percent hit in pre-market trading as China Mobile not only failed to announce its iPhone launch today as had been expected, but its chairman Xi Guohua specifically told reporters that the world’s largest carrier had no announcement to make.

While neither Apple nor China Mobile ever officially confirmed today as the launch date, the Chinese government confirmed the date as the one on which 4G service would begin, China Mobile had said it would launch “a new brand” today and the WSJ seemed confident last month that today was the day.

The deal has been a very long time in the coming, but all the pieces of the puzzle looked to have fallen into place …  expand full story


December 5, 2013


Less than a week after AAPL stock reached a new high for 2013, and two analysts raised their target price in response to Black Friday sales, the stock has also hit a 52-week high, running at $570 at the point of writing.

Billionaire investor Carl Icahn doubtless played a role, yesterday tweeting that he would be calling for a (non-binding) shareholder vote on an increased buyback program – though for a smaller amount than he had originally urged.

But Fortune yesterday posted a rather interesting chart that may suggest the upward trend will continue …  expand full story

December 2, 2013

Image: businessinsider.com

Image: businessinsider.com

Both Deutsche Bank and Global Equities Research have raised their target price for AAPL – the price they expect the stock to achieve – in response to spot checks of Apple sales on Black Friday, reports Fortune.

After spot-checking Black Friday weekend sales, Deutsche Bank’s Chris Whitmore raised his price target to $625 from $575. “We have become significantly more confident in our near-term estimates for Apple” […]

Global Equities Research’s Trip Chowdhry raised his price target to a Street-high $800 after visiting nine Apple Stores and five Targets and talking to “no less than 300 people.”

Anyone planning to invest on the basis of these numbers might want to dig a little deeper, however …  expand full story

November 29, 2013

We mentioned a couple of days ago that AAPL stock was approaching a high for the year, and it has now broken the $549.02 at which it began the year.

The company has experienced a roller-coaster ride in its stock price, almost entirely divorced from any product-based reality. The value placed on the company by the market at any given time has more to do with the gap between rumors and product launches, and of course short-term speculation …  expand full story


November 27, 2013

November 20, 2013

November 15, 2013


October 28, 2013


Update: The analysts were right to be optimistic, but not optimistic enough

As we wait for Apple to announce its Q4 results in this afternoon’s earnings call, more than half of the analysts included in Fortune’s survey expect the company to beat its high-end guidance of $37B. The average is driven up by the amateurs, who come in at $37.38B, while the professionals expect just a touch under the top end at $36.95B.

Predictions on both revenues and earnings do vary markedly, however. While the consensus view is that year-on-year revenues will be up 3 percent and earnings down 6 percent, even among the professionals the earnings estimates span a 15 percent range.

Top: FBN’s Shelby Seyrafi: $39.18 billion (up 9% year over year)
Bottom: Cantor Fitzgerald’s Brian White: $34.57 billion (down 4%)

Apple beating its own guidance wouldn’t have been remarkable in the days when Apple gave absurdly pessimistic guidance and then blew it away, but would be impressive since Cook started offering realistic ranges …  expand full story

October 23, 2013

October 16, 2013

October 2, 2013


September 23, 2013


AAPL quickly climbed 6 percent in pre-market trading following Apple’s announcement that it had sold a record 9M iphones in the first weekend, beating most analyst expectations. The last time it hit $500 was six weeks ago, when Carl Icahn announced his increased stake in the company, believed to be in excess of $1.5B.

Analyst forecasts for sales of the new iPhones had ranged wildly from 5M to 10M, but 9M was at the high end of what most were expecting and substantially above the more pessimistic forecasts. Four major financial firms had seemed unimpressed by the announcement on 10th September, downgrading the stock.

Apple’s SEC filing advised investors that it expects to hit the high-end of its earlier Q4 guidance …  expand full story

September 11, 2013

September 9, 2013


August 14, 2013

Following comments from billionaire investor Carl Icahn that he had taken a “large position” in Apple and discussed a larger buyback with Apple CEO Tim Cook, Apple’s stock experienced a new six-month high of over $488 per share. Today, AAPL continues to climb and has passed the $500 mark for the first time in nearly eight months since January 23rd.

In an interview with The Wall Street Journal yesterday, Icahn noted that he expects Apple shares will soon rise above $600 and explained his proposal for increasing the stock buyback:

“This is a no-brainer to go buy stock in a company that can go borrow” at a low rate, Mr. Icahn said in an interview. “Buy the company here and even without earnings growth, we think it ought to be worth $625,” he said, referring to the stock price, which closed Tuesday at $489.57, having risen 5% on the news of Mr. Icahn’s investment.

Mr. Icahn’s thesis rests on Apple borrowing at about a 3% interest rate and buying back shares right now, likely at around $525 a piece. A stock buyback can increase earnings per share by reducing the number of shares outstanding.

While Icahn didn’t provide any financial details, WSJ adds that sources say his stake in Apple is now worth over $1.5 billion. expand full story

August 13, 2013

August 5, 2013


July 25, 2013

Photo: huffpost.com

Photo: huffpost.com

Fortune reports that Apple’s stock repurchase scheme – buying back some of its own shares – is proceeding more than three times faster than scheduled.

The company was scheduled to repurchase 10 million shares in Q3. It bought 36 million […] By my calculation, the company spent $16 billion last quarter ($4 billion in cash, $12 billion through the so-called accelerated share repurchase program) to purchase 36 million of its own shares at an average price of just over $444.

If Fortune‘s numbers are correct, then Apple has already spent almost all of the $17B it borrowed back in April. Accelerating the planned repurchase program makes sense if you expect the stock to cost less now than it will later. In other words, if you’re expecting the stock price to climb …  expand full story

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