Justify buying AAPL at 400+: Ok, that’s easy. And I’ll do it in just one word- China.
The last two days should have proved to everyone that the Chinese market is certainly the most enticing, and relatively unchartered, market for Apple. Yes, we know: rapidly expanding GDP per capita, massive middle class growth, increasingly opening up their telecommunications sectors, and blah blah blah.
What is more important is the telling signs from the last week of news about Apple in China, for no matter what Apple does, the Chinese still insanely crave their products.
After camping out in frigid temperatures throughout the night, hundreds of loyal fans were denied the chance to get their frozen paws on the new iPhone 4S because of supply chain disruptions, a situation that was wholly Apple’s fault. Naturally, hoards of people began to riot, throw a couple eggs, and get arrested in utter disgust. In what would be a customer service nightmare for any other company, 21-year-old Zhang Tao summed up the event perfectly, “I would still buy the iPhone, I will keep waiting for the store to open, I like the phone, so there’s no other way.”
We know that Chinese mainlanders travel all the way to Hong Kong in order to wait in line just to get into a Louis Vuitton store. They crave trendy brands, and add that in with electronics and, clearly, Apple is a perfect fit. Is there really nothing Apple can do to turn off the Chinese consumer?
America is just as bad. Apple's new iPhone 4S was seen as the biggest flop in the tech community. They dropped the ball on 4G.
Yet what did the NY Times say about the 4s. OMG amaznggg! Siri is so cool!
Google needs to take down Apple already.
Apple could give away cigarettes and beer with the 4S. Free Marlboros and PBR. And a coupon off your new Buick.
I completely avoid investing in tech companies. I don't like to put my money into companies hoping for future revenue streams or absurd growth. For the longest time I thought buying AAPL was just betting that they would come up with a new revolutionary product.
However, last week I decided I'm going to buy some AAPL. At these prices, it's not gambling on the future or r&d pipeline. I haven't bought yet, but will be doing so soon. At this point it's just when, not if.
The only segment they have that didn't grow double digit percentages last year is ipods, which were intentionally cannibalized by the iphone. They're also priced at only 12x earnings, net of cash.
I also think the iphone 5 will be a blockbuster next year. If they decide to incorporate 4G that alone will make it blow the 4S out of the water. Additionally, a slight redesign will have everyone scrambling to upgrade their 4 or 4S. This would make it a blockbuster without anything revolutionary, which is unlikely with AAPL.
I'm also pretty convinced that they'll be paying out a special dividend within the next few years. The only way investors won't start demanding a one-time dividend is if they do launch another revolutionary product or possibly if they make a blockbuster acquisition ( either way this should be a win for shareholders).
Sold off my last 1k of AAPL this week. Bought 5k back in Nov. '04 @ $27, but this is how far I'll go with this stock. Of course there will still be an upside, but how big? Don't know and don't care. I'm out and will probably never touch this stock again with my personal portfolio due to no dividend.
Don't you think this expectation (Chinese + other markets) is priced in?
Against my point AAPL has a decent P/E for a tech name.
4S was a bloody disappointment....after Jobs i see apple going to the dogs
You don't think an IPad 3 and an IPhone 5 will launch this year? And when they do, won't they be blockbusters (especially the iphone 5, the 4S was a blockbuster and it really wasn't anything special)?
I'm sure the Steve Jobs projects will live on in their R&D pipeline for years.
I don't know how anyone wouldn't think AAPL is a great value here over the next 1-3 years. That being said if you plan on holding for 10 years, it will take new revolutionary products (post-Jobs) to increase the stock price. I'm not saying they can't or won't do it, but I understand not investing in that.
Why is that girl trying to wear an iphone as an ipatch?
in the next pic she uses it as a vibrator
Apple will be at 1000 in 4 years or less.
Because of USD currency inflation?
I cannot believe how much pull this company has. People are insane.
I cannot believe how much pull this company has. People are insane.
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