AAPL? Yes AAPL + THANK YOU!

Investment Analysis Clubs Saul’s Investing Discussions
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I wanted to throw this out for Saul and evryone else on this board to get some thoughts. When just looking at numbers, Apple seems like a no brainer. Very good to great numbers. Excellent balance sheet. Even dividends and share buybacks thrown in to add value.
These are numbers I came up with based on latest earnings release.

PE 13
YoY EPS 43%
1YPEG .30
YOY Revenue 28%

To me that revenue growth is most impressive. $51 Billion in gowth! I know the biggest “downside” is the size/scale and the problem with big numbers. That is what makes the EPS growth and revenue growth all the more impressive. Add that with the balance sheet, stability, and geting it all for PE around 13. It makes me wonder if this is a great opportunity staring us right in the face, too big to see. I currently have position in AAPL and has done wonderful me. It is in a category that I kindo f consider “autopilot”. As I have been learning from Saul and the wonderful folks here, I have been going thru everything I own, evaluating, running numbers, and trimming what doesn’t make the cut and adding to ones that do or looking for new oportunities.
AAPL kind of just blew me away tho when going thru that process.

Eveything seems to me that this is a great candidate for a “Saul” company, other than the fact they are already so big.

I would appreciate any thoughts/opinions and wondering if Saul has ever considered AAPL for a place in his portfolio.

Since we are looking at Thanksgiving, I also want to take this opportunity to say Thank You to everyone her that shares their knowledge to help enlighten those like myself. You have my gratitude every day, but felt now is a good time to express it.

Everyone enjoy a happy, safe Holiday!

Best, Kevin

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Nah it will never catch on.
:wink:
Happy thanksgiving to all you Americanos.
Ant

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Kevin,

Based on a couple of the basic filtering criteria used by Saul, namely low P/E and high growth rate, AAPL would indeed appear to be appealing. But because those are merely criteria for an initial filtering, you then need to look at the followup analysis, including reviews of other factors.

A soft/squishy factor that many investors seem to be using when reviewing Apple (the company, not the stock) is that there is a huge amount of skepticism that the recent growth rates of sales and profits is sustainable. I don’t think that you’re going to be able to do any other analysis of AAPL (the stock) without that factor overwhelming all others, and there’s really no way to quantify its future growth potential in any objective way, IMHO.

as always, i am full of carp

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Hi Kevin, I had a position in AAPL for a long time, but sold out because I thought they were too big to sustain much of a growth rate, basically that it would be difficult for any new product to be big enough to budge the needle at these levels. I was wrong, as they have continued to grow. But I still have the same hesitation, I’m sorry to say.

Saul

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Since we are looking at Thanksgiving, I also want to take this opportunity to say Thank You to everyone her that shares their knowledge to help enlighten those like myself. You have my gratitude every day, but felt now is a good time to express it.
Well said Kevin.
I rarely ever read any of the comments that follow an article on Yahoo finance, but having just done so I have to join you in your thanks to members of this and other fool boards.
It is truly a pleasure to follow these boards without all the insane crap that hits the boards on nearly every news site, or business site out there.
So thanks to all and Happy Thanksgiving to all as well.
Mike

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Yes, a Happy Thanksgiving to all of us!
Saul

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I like Apple, especially because they are making small steps into recurring revenue. I pay 99 cents a month for iCloud storage, it is not a lot but people will do storage and some will pay for music and there is Apple pay…

We just set up my husband parents with iPhones for the first time, they started with an iPad, then it was two iPads because they didn’t want to wait… then it was an iPad mini because the original iPad was slow…now two iPhones. Apple grows on people, even 80 year old people…

Long Apple
Happy Thanksgiving

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My concern with Apple is hinted at earlier in the thread. At the moment, and for the last few years, Apple profit roughly equals iPhone profit. And the iPhone Apple sells today will not be in demand 3 years from now, let alone 10 years.

To remain profitable at current levels, Apple has to remake the iPhone every year or so. It has to be updated and have features added and new processors designed and so on. That is not easy work. At the same time, they need to investigate new things. Lately, that would include the Apple Watch and Apple Pay. These don’t seem to be the blockbuster hits that the iPhone has been. So the next new thing may be something that is hidden deep in their research departments, or hasn’t even been thought of yet.

I’m also the first to admit that Apple seems to have done pretty well at inventing (or arguably, perfecting) blockbuster products. So I wouldn’t write them off at all.

But I firmly believe this is a risk that needs to be factored in to any projection about Apple’s future.

–Peter

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I wonder how long it will be before we end the silly practice of calling them phones. It is sort of like calling cars horseless carriages. While technically correct, it has gone far past that.

I agree completely that the iPhone Apple sells today will not be in demand 3 years from now. It is equally true that the iPhone of 3 years ago is not what is in demand today. I see no sign that the process is slowing down. How will these personal, portable, communication, computing, recording, and (who knows what is next?) devices evolve? I don’t know what they will look like in ten years, but I expect that whatever it is will be shaped more by Apple than anyone else.

There is an old saw that we can not predict the future but we can create it*. I predict that Apple will be creating the future when it comes to personal portable communication/computing/whatever else. I think they will make a lot of money in the process.

*(http://quoteinvestigator.com/2012/09/27/invent-the-future/)

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I’m also the first to admit that Apple seems to have done pretty well at inventing (or arguably, perfecting) blockbuster products. So I wouldn’t write them off at all.

Indeed. Look at how well Apple has done with computers, and phones, etc. How much do these products cost consumers, and how much has Apple made from them? Now consider this; how much does a car cost in comparison? If (big IF) Apple were to produce an all electric, self driving car (we are living in the future, aren’t we?), and everyone felt like they HAD to have one (Think iPhone), well… maybe we haven’t seen anything yet.

We’ve all been living in an age of HUGE paradigm shifts, and I suspect there are many more astounding things to come…

More land purchases, new hires, voice-controlled technology, and a possible Apple car company already in business are some of the top rumors over the past month.

http://www.fool.com/investing/general/2015/11/21/5-apple-inc…

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I like Apple, especially because they are making small steps into recurring revenue. I pay 99 cents a month for iCloud storage, it is not a lot but people will do storage and some will pay for music and there is Apple pay…

All the extra small ones are good, hopefully if they can grow to be larger over time while not loosing out on the big ones that need to continue to grow.

One area where I think they should really try to push is to expand in the traditional enterprise where Window machines are still the majority.

If IBM can now be fully on-board to shift their workforce, then hopefully they have a strategy to open up more enterprises. Traditionally, I think they are pulled into the enterprise, but just my observation. I see a few co-workers use their personal Macs and do ask for the company to bring them on-board or at least officially support via BYOD program but there still is resistance.

http://www.businessinsider.sg/apple-says-ibm-saves-270-for-e…

He also said IBM now has over 30,000 MacBooks deployed within the company, and is adding 1,900 new MacBooks every week. IBM has committed to buy 50,000 MacBooks by the end of this year through its Apple partnership deal struck last year.

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Apple has a long term problem. One could define their business by display screen size. Now that goes from watch size to 27" size , more if you count Apple TV. The range is full.

All electronics that I know of have eventually become a commodity. That is already happening with iPad. Since the present iPad is as good as anybody needs, I am going to keep my present generation iPad a long time.

Apple computers are slowly gaining market share, they are better and least longer than the competition. that will be market share increase but at near glacial speed.

iPhone is the exception, everybody wants the latest. I’m not quiet sure why ,but maybe because mobile phones lead a risky life, getting wet get cracked and banged around. And because of great trade in prices and carrier support don’t cost all that much. So if Apple can’t avoid communization will they become MSFT, milking dollars, become Kodak and fail, become Sony and struggle along?

Or will they try do ometning new. There are not many industries containing something that is both big enough and has good growth potential.

Did i mention wall that they have tons of capita and good cash flow.?

I think they will indeed enter the electric vehicle car industry . They would be one that is able to do it,they have money and the talent that few others but Google and Tesla, Everthing that Drucker and Christensen and several others taught me is that incumbents will never be willing or able to desert their present turf and customers, ,the ones that make money for them now,fast enough to become fully effective in a new technological innobvation.,.
One can argue whether pure electric care are sustaining or disruptive but either way present car makers will have trouble making the change
So we have if the average car car costs $15,000 and 100 million are sold each year that is a lot of money. A very tempting target when n it is known the biggest changes will probably come in batteries and electric motors and self driving, not the strong points of present ICE car makers

Applec will enter the electric car market (Where else can they go and still be getting bigger a decade from now? And how else can COOK become an ikon like jobs.,Gstes, Musk Edison etc … it won’t be long before Apple has to decide. Present employees dedicate to autos are probably enough too get design underway but they will need more for production. If they are going into BEV I will but more AAPL shares, because I think they have or can get the talent to make it work.If you are s young hotshot software engineer where would you want to work, in California with Musk or Cook surrounded by similar people ,or in Detroit or Wolfsburg?

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The funny thing about a 3-yr-old iPhone is that it will upgrade with each new iOS version, so that you can still use that iPhone for years and years and years if you don’t pine away for the new hardware upgrades that come along. The Apple ecosystem lets their old products keep working, for the most part. I have an ex-work colleague who bought every new Mac computer that was built, from the original iMac. All of them still run, on the latest versions of the iOS. That longevity of function may look like a drag on purchases of new devices but it also gives buyers a confidence in their investment into the Apple ecosystem, which is priceless. Just see how many folks bought their first Apple product and then another, and another…

That said, my 2 iPods are orphans who still work but don’t receive any more support at all from the company. That is a huge wart on their reputation, and I’m still bitter. But not enough to change out of the ecosystem and go back to crappy bandaids-n-mirrors Microsoft products.

Apple does offer a good value. If another company was growing YoY 28%, and it had another name, the same cash on hand, was paying a dividend, was buying back shares aggressively, and a 1YPEG 0.30, with good management and promise, would you not be thinking about a position?
Just wondering.

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