Josh Lowensohn of Cnet, in a preview of Apple’s earnings yesterday, wrote about the possibility of a dividend/stock buyback:
In a note to investors last week, Sanford Bernstein analyst Toni Sacconaghi said not to hold your breath for news about this during Apple’s conference call…
Speaking of Apple stock nonsense, here’s a great reminder by Abdel Ibrahim of The Tech Block:
The entire point of showing you these charts is not to give you some Jim Cramer buy signal. It’s to tell you to ignore the bullshit headlines that seem to be flooding the internet and newspapers. They come from analysts. Analysts with agendas to either inflate the price of a stock they own or deflate the price of a stock they want. Regardless, good companies will continue to thrive and bad companies will continue to fail. Apple, in my eyes, is still a very good company. Time will tell if I’m right or wrong.
History. It repeats.
I’ve fixed Nick Wingfield’s headline for The New York Times.
The main problem is that if you had written this post on September 19, 2012, the story would have been that Apple’s stock is up roughly $320 a share — nearly 100 percent — since the day Tim Cook took over as CEO.
Under Ballmer, Microsoft’s stock price has never been higher than when he took over. That was January of 2000 and the stock was around $100 a share. The closest the stock has come to that again under Ballmer was around $50 a share, leading up to the stock split in 2003. Since then, the stock has basically hovered in the $20s a share range for a decade.
In other words, when you point out that Cook’s tenure has seen a collapse of Apple’s stock price, it’s silly not to mention that it was a fall from the unbelievable highs that he also presided over. With Ballmer, he’s presided over a loss of the market value that was run up by his predecessor, Bill Gates.
Anyway, I actually agree with the sub-point — that a stock price is often not as closely tied to financial performance as one might imagine. That has been made very clear with Apple. Instead, it’s largely a game about trying to predict the future. And some now feel that Apple’s future is as bleak as the future people have been predicting for Microsoft for the last 10 years (myself included).
But Apple’s stock crash has a different feel, in my opinion. It feels like hedge funds and other large entities are playing a different game with the most valuable company in the world. And the people who don’t realize that are on the losing side of that game, and will remain there.
Asked by dcmenzel
I recall the same questions being raised when Google fell from $700 to below $300. Today Google is at $780.
It’ll be back.
Tim Cook, speaking at the Goldman Sachs investor conference this morning. He’s obviously referring to the lawsuit being filed by hedge fund manager David Einhorn.
Michael J. De La Merced for NYT’s DealBook discussing hedge fund manager David Einhorn’s lawsuit against Apple:
Mr. Einhorn on Thursday compared Apple to his grandmother, whose experience surviving the Great Depression molded her into an extreme saver who did not leave voice mail messages for fear of using extra cellphone minutes. The company’s own near-death experience in 1997, he said, left a similarly profound scar on its corporate psyche.
It is fascinating just how conservative Apple has been with its cash — especially when compared to a company like Amazon, which can’t seem to get its cash off the books fast enough (to Wall Street’s delight, no less). At some point, this will always going to piss off Wall Street.
There’s also a pretty good Branch forming around the related topic of taking Apple private…
Would you say that what Apple's earnings reveal is releasing the new iMac may have been a mistake? Yield/manufacturing capacity wasn't sufficient to meet demand, even without evidence of a massive bump due to the new form factor. Given the massive change to the rest of the lineup, maybe Apple should have held off on iMac form factor updates until Q1 or Q2 2013 or released a more modest change.
Asked by jasonpbecker
If you’re thinking from a pure investor standpoint, that’s probably a fair assessment. Apple clearly slipped up from a supply standpoint and, as a result, it partially screwed up their earnings. But Apple has a history of shipping products when they’re ready not when Wall Street would like them. I think to do the latter would be a huge mistake, obviously.
There’s no question that Apple screwed up here, but they perhaps should have pushed the iMac slightly to meet consumer demand, not Wall Street.
Chris O’Brien of The L.A. Times look at Apple’s recent stock volatility. Talking to Howard Silverblatt, a senior index analyst for S&P Dow Jones Indices:
Silverblatt said the only company that has come close to having such a strong influence on the broader stock markets since World War II is IBM in the early 1980s, when the PC revolution was just getting started. But not only is the value of Apple’s stock remarkable, so is its volatility. Such large stocks rarely have such big, quick swings.
Apple’s stock briefly dipped below $500-a-share this morning, which is crazy considering it was above $700 in September. And on the surface, there doesn’t appear to be an obvious reason for the downward swing. But as O’Brien explains, a huge swath of institutional investors now own the stock and their actions, often driven by fund goals, drive swings.
Last year, I was super-bullish on Apple’s stock following an earnings miss because it was clear that most analysts were missing something obvious — and that Q1 would be a blow-out, as it was. This year, it’s decidedly more murky. Q1 is still going to be massive for Apple, probably their biggest ever, but people are expecting more.
Still, Apple around $500 seems like an absolute steal (their P/E is half of Google’s). No, I don’t own any Apple stock, but if it actually goes below $500, I’ll have to consider it because I’m a sane person.
The stock will open tomorrow well above $700 (it’s $702 right now in after-hours). The market cap is at $655 billion — it’s now nearly $400 billion ahead of Microsoft.
It was only May 26, 2010 that Microsoft was still ahead in that regard. Since then, Microsoft has gained around $35 billion in value. Apple has gained $430 billion.
If you purchased $1000 of Apple stock when Steve Jobs came back on board in the fall of 1997, your shares would be worth $30,463.50 today.
Sadly, I only served as an Apple shareholder in the 2005 (when I bought my first Apple computer) to 2008 (when I became a tech blogger, and sold all my stock) range. I just 5x’d my money in that span, rather than 30x’ing it.
“In other words, don’t mind the markets, once they see the long-term value we’re building, our stock price will come around. He noted that we almost never as good or bad as our stock price might indicate. Since the only metrics he focused on presenting to the company were those about our underlying fundamentals, he taught so many young people a first and important lesson about focusing on what mattered, what we could control, which was the customer experience.”