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http://m.seekingalpha.com/article/1365531

Coming into the earnings report, analysts were expecting $43.66 in earnings per share this fiscal year from Apple. Q3 guidance implies that Apple will be about $2.00 below where analysts were expecting, so I think you have to take some of that off the current figure. However, I think that also means Q4 will be fairly decent on new product launches, so I think expectations should be around $42.00 for the fiscal year. At that earnings level, I would expect to see Apple at about $462 by October, which implies decent upside from where the stock was in the pre-market. That upside does not include any dividend payments, and also doesn't take into account any stock buybacks that could impact earnings. Add some of that in, and I think 20% upside for Apple in the next few months is reasonable.
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Maybe you guys should have taken up the bet. This guy suspects apple will reach $460 by October; which is after my bet deadline.
 
Article on Yahoo today. I found this interesting.

* The company has spent $2.1b on R&D over the last 6 months, putting it on pace to spend around $4.2B for the year. To be generous, we'll say Apple's expected R&D expenditures are about 2.5% of revenues. To compare, the percentage of revenues used for R&D at Microsoft (MSFT), and Samsung are about 11% and 6% respectively
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* For the current fiscal period Apple lowered its revenue forecast to between $33.5 and $35.5 billion, well below the Street's estimate of $38.2b. In the same quarter in 2012, Apple booked $35b in sales and earned $9.32 per share
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http://finance.yahoo.com/blogs/breakout/apple-good-bad-rotten-115009507.html?vp=1
 
MSFT is up 7.8% in the last 5 days. Apple owners are moving their money.
 
magnifier661 said:
Well fine.... But after tonight's call we will see. I have a wager to Denny. Would you like to take me up on it? It will make you $1,000 richer if they don't reach $500 before next quarter
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Why would I make that bet with you instead of just creating that trade with options?

If you're so sure of your valuation and stock selection to reach $500 by next quarter, buy a significant amount of aapl June $450 calls and post your trade confirmation here.
 
blazerboy30 said:
So why has the value of the stock, in your valuation, dropped by $290/share even though they now have cash and a higher EPS?
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All that cash was accrued during the great months. They are using that cash for buy backs. $60 billion in company but backs; what other company you know are buying back that amount?
 
blazerboy30 said:
Why would I make that bet with you instead of just creating that trade with options?

If you're so sure of your valuation and stock selection to reach $500 by next quarter, buy a significant amount of aapl June $450 calls and post your trade confirmation here.
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I already have 100 shares. I already said that I own it more as a fan, not for investment.

If you are so sure that its highly undervalued, then short the stock and post confirmation here.
 
magnifier661 said:
All that cash was accrued during the great months. They are using that cash for buy backs. $60 billion in company but backs; what other company you know are buying back that amount?
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So a company buying back their own shares with their cash makes them worth less after the purchases in your valuation model? According to your valuation, they are buying their own shares right now at $400 when they are "actually worth" $500. That should make their overall value increase, not decrease.

Even if there is any logic in your assumption, then why are you taking 37% off of their value ($790 to $500) even though they are only using $60 billion for the buybacks?
 
blazerboy30 said:
So a company buying back their own shares with their cash makes them worth less after the purchases in your valuation model? According to your valuation, they are buying their own shares right now at $400 when they are "actually worth" $500. That should make their overall value increase, not decrease.

Even if there is any logic in your assumption, then why are you taking 37% off of their value ($790 to $500) even though they are only using $60 billion for the buybacks?
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No I am saying that back then, they accrued all that cash. They didn't the last quarter; which drops the share price. It's a downward trend, IMO. When I said they are buying back shares, that implies they believe the stock is undervalued.

I have already given you my reasoning why I believe their shares are worth $500, using the x earnings model. Back when the stock was $700; it was still 6 times earnings. You keep ignoring a very obvious tool that most investment companies use.
 
magnifier661 said:
I already have 100 shares. I already said that I own it more as a fan, not for investment.

If you are so sure that its highly undervalued, then short the stock and post confirmation here.
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Please show where I said aapl is "highly undervalued". Also, you're the one wanting to make a bet with Denny and I... show us how wrong we are with your purchase confirmation.
 
magnifier661 said:
No I am saying that back then, they accrued all that cash. They didn't the last quarter; which drops the share price. It's a downward trend, IMO. When I said they are buying back shares, that implies they believe the stock is undervalued.
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What are you talking about? They definitely accumulated more cash last quarter.

magnifier661 said:
I have already given you my reasoning why I believe their shares are worth $500, using the x earnings model. Back when the stock was $700; it was still 6 times earnings. You keep ignoring a very obvious tool that most investment companies use.
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Most investment companies absolutely do NOT value companies on a x earnings model. If that were true, companies would all have much more similar PE ratios instead of ranging from 0 to several thousand.
 
blazerboy30 said:
Obviously it's being sold off. You're saying it's a buy. If people had listened to that reasoning months ago, they'd be down 40%.
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Well this right here blazerboy... This was a reply to when i said it's a good time to buy.
 
blazerboy30 said:
What are you talking about? They definitely accumulated more cash last quarter.
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Did you just read the conference call? Show me where they showed increased cash flow?


Most investment companies absolutely do NOT value companies on a x earnings model. If that were true, companies would all have much more similar PE ratios instead of ranging from 0 to several thousand.
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Whatever you say. I am getting more of a feeling you are just trying to argue just to argue. I've been hearing apple is going down since the 80's. And yet, here it is stronger than ever. So if you want to believe apple is seriously over-valued, then go for it. You don't want risk, then you can just have little reward. Personally, I don't mind taking risks and I have done pretty damn well in process.
 
Hello?!?! Blazerboy? Where are you now? Anyone? Anyone? Bueller? Bueller?
 
blazerboy30 said:
Why would I make that bet with you instead of just creating that trade with options?

If you're so sure of your valuation and stock selection to reach $500 by next quarter, buy a significant amount of aapl June $450 calls and post your trade confirmation here.
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Okay fuck it. I will purchase one call of $450 contract dated at June. If I make a profit; then you will post how wrong you are and you should have never doubted the great magnifier. If I lose money; then I will post how I am stupid for ever thinking apple is undervalued.

My contract call is $4,800 (100 shares) assuming the premium of length. Is that a significant amount enough for you?

I will post a picture of the transaction for proof.
 
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magnifier661 said:
Did you just read the conference call? Show me where they showed increased cash flow?




Whatever you say. I am getting more of a feeling you are just trying to argue just to argue. I've been hearing apple is going down since the 80's. And yet, here it is stronger than ever. So if you want to believe apple is seriously over-valued, then go for it. You don't want risk, then you can just have little reward. Personally, I don't mind taking risks and I have done pretty damn well in process.
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Again, I never said it was "seriously over-valued". You're just making up stuff and building strawmen.
 
magnifier661 said:
Okay fuck it. I will purchase one call of $450 contract dated at June. If I make a profit; then you will post how wrong you are and you should have never doubted the great magnifier. If I lose money; then I will post how I am stupid for ever thinking apple is undervalued.

My contract call is $4,800 (100 shares) assuming the premium of length. Is that a significant amount enough for you?

I will post a picture of the transaction for proof.
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:MARIS61: The thing is, I never made a prediction either way. I honestly have no idea which way this stock will go. You could be right, you could be wrong.

The thing I am sure of, and my original point, is that you can't guarantee a value for a company, especially based off of purely a "x earnings" method.
 
blazerboy30 said:
:MARIS61: The thing is, I never made a prediction either way. I honestly have no idea which way this stock will go. You could be right, you could be wrong.

The thing I am sure of, and my original point, is that you can't guarantee a value for a company, especially based off of purely a "x earnings" method.
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The only thing you can guarantee is "book value" like Denny pointed out. The rest is purely speculative. And if anyone bases their investments on guarantees; then they need to buy insured bonds or bank CDs.
 
blazerboy30 said:
So a company buying back their own shares with their cash makes them worth less after the purchases in your valuation model? According to your valuation, they are buying their own shares right now at $400 when they are "actually worth" $500. That should make their overall value increase, not decrease.

Even if there is any logic in your assumption, then why are you taking 37% off of their value ($790 to $500) even though they are only using $60 billion for the buybacks?
Click to expand...

They're also decreasing the supply which increases price.

Econ 101, supply/demand curve.
 
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