VGStockz: General Questions

[Train wreck]

Ail said:

Train wreck said:

Ail said:

Gosh Apple can't stop....
My Apple stocks are now 36% up since my purchases in October and I've been steadily beating the S&P 500 since the beginning of 2012 only because of Apple. And that's in a real portfolio that contains bonds and cash too...

TBH I wish it could slow down as I am in for the long run ( no way I pay 30% tax on my Apple profits) and at the current rythm the stock is going to derail at some point..

My only position down is EA and it's my smallest position...
I got on the Microsoft train a few days ago too, after reading a bunch of stuff about the stock and the company...

Yea apple is definatly in a bubble right now, the fundamentles of the company (even being the best in the world) cant justifiy the price.  I would use any product news announcements to sell out shares.  The first real test will come on Wednesday with the Ipad 3 on display, the stock will initally go up, but then have a reversal.  I would allocate out of apple and into microsoft.  windows 8 cycle, new windows server 8, arm based tablets, continued xbox strength, the stock will continue to go up this year.

Im waiting for a further pullback in Sony to start a new position in it, the stock has been up I want to say 15 out of the 20 trading days this month, truly insane, but the move from 16 to 22 was kinda fast, down 3% today maybe once it hits the mid 19~ ill use my tax return to start a position.  Unlike all the non financial people here on this site, Sony prospects for Q1 12 and the rest of the year is positive.  Adele continuing to have strong album sales in the US (and a new album coming out), two blockbuster movies on tap this year (men in black 3 and spiderman reboot), higher preiums for their insurance unit due to the earthquake, possibity of another flooding indicient in thailand and earthquake in japan are extremely remote, the challenges are its TV business and how it will intergrate its Sony phone line.  Hiari indicated that the TV business will be focus one.  The Vita honestly does not matter, its a small margin item and it will add to overall revenue but in terms of breaking the company, its laughable. 

I still have my sprint position, trading at 2.50, I still believe that a merger is in its future, but at the rate its burning cash, going to the market for more, still owes apple 15.5 billion and all the clearwire obligations, the company going to go into chapter 11 and restructuring and selling assets might be its only option.

I disagree that Apple is in a bubble.

Right now the stock is  trading a forward P/E of 13 which is bellow the average S&P 500 of 15...

Don't forget that most investors have already priced in the stock the coming dividend or stock buy back too ( we don't know yet which will happen but something will, personally I would vote for a dividend as a buyback on stock with that much daily volume isn't going to drive the price that much...)

I would argue that for Apple to be priced correctly the stock should be around 600$..

What I agree on however is Apple will not keep growing its earnings at the same pace it has over the last years so I expect 2012 to be the last really good year for Apple's stock...

It's not a stock that will be in portfollio in 5 years as I don't like the long term prospects ( if for whatever reason the phone companies stop subsidizing smartphones one day, the Iphones sales will tank)  but right now it is my biggest holding ( mainly because it has been growing fasters than others) and that's where it should be...

 

Everyone I talk to points me to the same thing, that the company has a low P/E and its true, but the P is what is concerning me.  Its stock price is pricing in perfection, one misstep and its look out below.  Many companies in eastern europe  (small but its starting somewhere) and one here in the US are refusing to carry the iphone because of the upfront fee apple wants, if more companies catch on (either due to falling iphone demand or another financial crisis) then that can effect earnings.  Android tablets really offer no competition as someone like a Samsung cannot define its own market (they come out with so much junk) but microsoft might be a better opponent in that space.  Apple's cash position means that it will have a permament bid beneth it (kinda like microsoft, its topped out at 66 in 1999/2000 i believe but really never went below the 20s during the past decade outside the financial crisis in 08.)

Bubbles like everything will be a heinsight thing, apple might be at 1,000 before it breaks but I guessthats why we trade.