Tag Archive: stock market


  1. I do not work for Apple. I have never worked for Apple. Maybe one day the universe will smile on me and I shall work for Apple but I guarantee it will be the last employer I ever have.
  2. I am not a Wall Street Wiz. I do not fully understand the nature of stocks, bonds, options, etc. I do not day trade. I do not consider myself an active investor
  3. My comments do not reflect any company I work for, my family, my loved ones, my friends, my frienemies, my enemies, my diety, or any other thing that may go bump in the night.
  4. When I give Quarter numbers, I’m using Calendar quarters

Apple is currently trading at about $410 per share as 2012 kicks in. The 12 month estimate by many analysts is 460-500.

So I decided to throw my hat into the ring with only my experience of building my career off of Apple’s business.

First off: Previously to last week, the last time I bought into Apple Stock was December of 2008. For those keeping track that was in fact 3 weeks before Apple introduced the iPhone. I purchased at $92.67 per share. Which has now increased about 350%. I did not know for a fact that the iPhone was being introduced. But I had enough confidence in the rumours I was hearing at that point.

So where are we now? Apple has just delivered a holiday quarter that has had all iPhone carrier’s exclaiming record sales. (In the US: Verizon and AT&T simply won’t shut up about their iSales). In about 2 weeks Apple will deliver it’s quarterly numbers. The halo effect of these iOS sales continues to be very visible to anyone tracking Mac usage as well as Mac OS version usage. Black Friday on showed an unbelievable uptick in 10.7 Mac usage with a surprising lack of those numbers coming from pre-10.6 users scrapping those old machines. In fact, Giving a used Mac to a friend as a holiday gift seems to be on the increase this year.

I was a Steve fan as much as anyone else. But there were certain areas he was tenaciously stubborn about that I think that he might actually have been wrong about. One of the major issues was the “Berkshire Hathaway” view of having LARGE stock prices and no dividends. Wall Street definitely had a history of vicious treatment of the company that in the 90’s couldn’t have an article written about it that didn’t contain the word “Beleaguered.” In the 90’s you could be assured that if there was bad news, the Apple stock price would fall. If there was really good news, it would still fall. Much of this was blamed on the fickleness of day traders affecting the large investors (Money Markets, Indexes, Mutuals, etc). So there was no point to Dividends because there really wasn’t a reason to reward investors. People weren’t in Apple for the “Long” haul. And Apple was busy mounting a war chest of cash in case it needed to buy itself out against a hostile take-over.

But this isn’t the 90’s. This is 2012 where we’re dealing with a company that has gone up 400+% in the past 5 yrs and 3500% in the past 10 yrs. All with one split and no dividends. We now have some fairly entrenched funds that are in Apple for long range investment. Apple is major component of the NASDAQ and had to be reduced to more fairly balance the NASDAQ index.

Personally, I think Tim Cook sees this and has been pushing for either a split or a dividend for quite some time. And these are the kind of behaviors that will push long term heavy investors to push more money into Apple. It does risk bringing the day traders back in; but it also could cause another burst in value to push a post split cost up to a range that would again reduce the day trader signal to noise ratio.

But Apple doesn’t just play to Wall Street and that’s what’s made them so successful the past 15 years. As Jobs quoted Gretsky, “Don’t skate to the puck, skate to where the puck is going to be.” Apple has a bad 3rd quarter and it was well aware it was going to. Wall Street again battered them for “The ride is over” but the simple truth there was that they were positioning the products in the quarters that would give them the better return. This is why Apple is so tenacious about secrecy on new products. Once people are convinced the new product is coming; they stop buying the old product. The number of people this summer who asked me if they should wait for the (not yet delivered) iPhone 5 was insane. If you want an iPhone, get an iPhone. And then replace it after a comfortable amount of time. But many people expecting the replacement knowing it was not coming out when expected waited. One analyst said he expects the Q4 numbers to make up and include the perceived loss of the Q3 numbers. Apple wants the right killer product every quarter to make up the sales numbers. And if it means having one bad quarter to move a product to a better quarter… so be it.

Short form: Apple doesn’t care if it has a bad quarter if it will make things look even better in the long run. You may not be into Apple for the Long run, but Apple is.

So what’s on the horizon? Who knows. However, I will now look at the amorphous world of rumours and give you my opinions.


In general I think we’re going to see the following schedule in the world of Apple:
Q1: Mac Pro Laptops/Desktops
Q2: iPad 3
Q3: Mac Consumer Laptops / iMacs
Q4: iPhone: Alternating yearly between New models and “S” revs. 2012-Q4: iPhone 5; 2013-Q4: iPhone 5+; 2014-Q4: iPhone 6;

Ah but what about this elusive iTV. I think people will expect it in Q2, not get it; Wall Street will punish Apple for yet another unannounced product and then it will bounce back.

Oh, there’s certainly iTV in the works. Though, Q2 seems to early. It would also steal thunder from the iPad 3. Now if we swap Q1/Q2 and get the iPad out earlier the TV is potential for that Quarter. Personally, I wouldn’t expect to see it before Q4 with potentially an unveil in Q3 for the purposes of WWDC.

It is obvious that there is a conceptual progression within Apple for areas to move into that are not its base line of products. It also is still being first to ship on quickly imitated technologies, “Look Android and MSFT Phone have Siri, too… Um.. now”

So we can be sure that the iPad 3, the iPhone 5 will sell like gangbusters and continue Apple’s recent history of Year over year revenue increases. We also are clearly seeing a huge Halo effect into the App Store, Music Store, Mac platform. This for the next year or two will increase.

The competition. RIM is pretty well dead. Interest in the MSFT phone platform doesn’t sound good and with their treatment of the ZUNE, confidence in the long term is very low. Android is now closing code (1). Amazon is still selling at a loss. Things don’t look good number wise.

Okay… estimate time.

Initially my target number was 540 when I bought at $400 last week. I however am going to change that.

I believe that in other Q1 or Q2 the Quarterly report will include one or both of the following
A Split and a Dividend.
Personally, I think they could do a 3:2, but I think it will be a 2:1: This would effectively take the share price to $200. I think with the iPhone 4S numbers, the iPhone 5 and iPad 3 alone, this will then increase throughout the year to $275. If the TV does announce at this point; I think you will see that number in the range of 250-325 depending on its success.

So my final target for APPL for Dec 2012 (Assuming we haven’t found the mayan clock referred to at the bottom of the first clock where it says, “Continued on next clock”)
No Split: $560
Split: $295 ($590)

And no. I am not liable if you take this advice and lose your shirt 🙂

Papa Drè
(I use that name when gambling)

(1) Android Ranked most ‘closed’ open source OS
(2) Android’s ‘clopen’ Ecosystem is Taking Toll on Customers
Consequences Of Android’s “Openness”

020120103.1355 – Added Android Footnote (1)
021202103.1359 – Added Android Footnotes (2,3)

Wamu takes a dive: that’s NYSE:WM
Wachovia takes a dive: that’s NYSE:WB

Other NYSE:W* to watch
NYSE:WF Woori Finance (off 20% today)
NYSE:WG Willbros Group (Off 16%)
NYSE:WL Wilmington trust (Off 14%)

But honestly.. following the basic pattern the next victim of collapse would be:
NYSE:VQ Venoco, Inc (Oil and energy company off 8% today to $12)
Though if we simply look at Investment/Banking between VQ abd WB we find:

NYSE:VT Vanguard Total World (Off 7.5%)
NYSE:VV Vanguarg Large Cap (Off 4%)

Have fun 🙂