Opinions
Charles Lannon
Apple Inc
AAPL-Q
COMMENT
Jun 24, 2015
Stock price when the opinion was issued
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She added around $210-215. Their earnings call was excellent. Growth is only 2%, but topline was much better. The iPhone 17 will be a better roll-out than the 16, given the AI presence, and Apple continues to do well in China, especially the Mac. The negativity over Apple is over. Buy dips.
A trade, not a long-term investment. He trimmed it, because he's been buying higher from $206, and will sell when he sees exhaustion in shares. $235 was a temporary ceiling, so he took some profits (sold half his position). He doesn't look at prices, but how the stock reacts to the overall environment. Is purely a trade.
Sat out capex on data centres and infrastructure that's depleting other companies' cash balances. Time will tell whether this was a good move or not. The big capex spend may not have been the most efficient use of capital.
Core company beliefs are free cashflow and earnings. Consistently buys back shares, which enhances return to shareholders. Apple owns the end consumer. Don't count it out yet.
Premium contentApple's revenue for the last quarter stood at $94 billion. This reflects a decrease of 1.39% from the previous quarter, indicating some short-term concerns about sustained growth. However, compared to the same quarter last year, there is a promising increase of 9.63%, pointing towards positive year-over-year growth that suggests underlying business strength. Social media mentions are up 53.1% in the past 24h.
Premium contentApple EBITDA for the last quarter was $28 billion, which represents a significant decrease of 13.08% compared to the previous quarter. While this is concerning, it is only a slight 0.61% decrease compared to the same quarter last year, which could suggest some stability over a more extended period. Social media mentions are up 23% in the past 24h.
Premium contentOn Tuesday, they roll out the iPhone 17 and he likes what he's hearing about them. But Wall Street doesn't seem to care. Own it, don't trade it. Is up only 7.78% the past year, trailing the S&P, but doesn't bother him. Is up 41% since the April low, back in the good graces of Trump. Apple sales are growing again. Remains a huge position of his.
It is important to separate the outlook for the stock versus the company. They both have challenges. At the company level, it is no longer a fast growth company. The key areas where it makes its profits are pretty mature. It is hoping to develop new revenue lines through music streams, watches, etc. As the stock goes through the transition of being a very high growth company, to being a lower growth company, to being an average growth company you are going to get a rotation in their shareholder base. It is tough to see how the stock will do well over a sustained period of time.