Opinions
Ross Healy
Apple Inc
AAPL-Q
COMMENT
Jun 04, 2018
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 a microcosm of the S&P 500. It has had a tendency of peaking out at 5.5 times its book value. It usually sinks back 15-20% of its trading value when it hits here. He expected this but this time it did not happen. AAPL-Q has been trying to push higher but every time it gets there it gets pushed down. One thing that is interesting is that if you look at the slope of the growth of AAPL-Q, It was growing aggressively until 2012 and then they started to buy back shares and the growth of the company slowed considerably. Most interesting is that the rate of earnings growth has also slowed down as it has for many other similar companies that have bought back stock. This move to buy back stock is damaging to shareholders. If the company is not reinvesting, the growth slows. They wasted shareholders' money with these buybacks. The ceiling is $161 right now. The book value will go down. If we ever get into a market correction then this stock will have a good one.