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Wednesday, December 16, 2015

$aapl review

Last time aapl started seeing this much negative chatter for its stock was in 2013.

Will history repeat or rhyme? Who the fuck knows. 

From wall street to influencer chatter, the sentiment is the same for iphone growth: flat/negative everywhere except China (where there will be unquantifiable growth). Obviously not reassuring. But hey, Goldman's conviction buy recommendation was predicated on flat iphone sales and a growth in services! 

The charts look okay, but when the markets are up so much, and a market leader lags, its not encouraging.

The 78 sma on the weekly should not have been broken, and the lack of a bounce sucks.

If the stock follows the monthly pattern, aapl maybe headed toward 90. Fucking 90, for the most premier tech name (or rather the most premier company) in the world. Why such colorful language? Because a price of 90 means single digit multiple, not factoring the massive cash position. 

Looking at the historical trailing PE, the asinine single digit multiple can happen. Consider the lower red line the low level trailing PE, and the lower blue line the asinine level trailing PE.

I am for trading momentum, unfortunately I am a sucker for the fundies. A few differences between 2013 and now:

1. Cook era Apple was not tested. Since Cook took over he has more than handily proved his capability to motivate and release successful software/hardware. (The company moves fast and executes.)

2. Wall Street big-gun support. Once the big guns got involved the stock started to turn. They still seem to be involved. 

3. The services business is growing fast. (Its a $5B/qr business!)

4. A road map was laid out through interviews or released chatter for the car. But looking at recent developments with their products (Apple Watch, new AppleTV, potential car) and Swift going open-source, Apple wants the IoT space. And with Swift open-sourced, and the quickness of developer uptake, they can own it.

5. A steady increase in margins since 2013.

I'm long aapl. I'm annoyed as fuck that it didnt bounce off the 78sma as the SP500 had a super bounce, but I am long. 

Fun fact: In Q1, aapl usually sees an increase in cash position by ~$15B. (They basically earn a Twitter every Q1, free and clear.)


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