Apple Computer, Inc. (AAPL)

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Ta :)

On the downside AAPL does face the ugly business of a SCE investigation and a ugly class action lawsuit which promises to be high profile.

The bears are out on tech because the general consensus is that the peak period (the season) for tech stocks is over now.

As bullish I am about AAPL's long term prospect, the current sentiment swinging against the company is music in my ears. The question is now how low will the price go in the sale?

I'd advise caution on that one now. A good MOS will be around 65$.

[loslobos71]

I agree. Lets wait for the short term stuff to clear before moving in.

[GRock]

My MOS on latest earnings was 80.95. Almost bailed on recent slide when all the indicators went negative. Should be going back up.

GRock

[pnekkala]

Guys
I used the downloaded 'auto_msn303.xls' for AAPL and it shows an MOS price of $7.72. This can't be right. What's wrong?

[npg]

With the new yearly numbers out AAPL shows up with a more sensible MOS. I compensated a bit for the rough patch they were going through earlier on, although still being on the conservative side.

Bearing in mind that the next release of their OS, codename Leopard, is powering the iPhone, it is not too hard anticipating the direction future products are going to take and what awaits the consumer with the now iminent release of the system. Right now, if you buy a mac you get a voucher for a free upgrade to Leopard, valid for 3 months. This means that the launch is iminent. Insiders expect a hardware upgrade to follow with or shortly after the launch. It is well timed because it will be targeted at XP users who are ambiguous about upgrading to Vista (VIruses, Spyware, Trojans, Adware).

Potentially that release will steal the show from Vista. If apple releases a completely new UI with the system it will not be shown in the Beta's. They are famous for their secrecy.

What MOS do I have? It's around the 66$ mark. However, assuming a better annual growth rate than analysts predict (20%) and a historical P/E (35) rather than the current one the MoS lies in the mid 70's.

People are a bit jumpy right now and the reaction to GOOG results are plain hysterical. For god's sake they trippled their earnings! AAPL also released an earnings surprise beating even the most optimistic estimates by 67%. The latest action doesn't make sense and creates a lovely buying opportunity.

The shadow of the .com area still looms above these valuations --which means fear... and thats a welcome opportunity for a value investor.

[GRock]

Wanting to pick up more shares. Had bailed when the indicators said sale. The big difference with the previous dot com bubble is these company's are actually making money and have real reasonable multiples. Back in the late 90's the fed dropped interest rates to unreal market levels because of the Mexico Paso problems, Failed LA pension fund and I think a collapse hedge. Supply and demand. Low interest rates pushed money into stocks at unreal levels and the biggies could not get enough of the Dot Coms for the demand they had. A similar thing happened a few years before the 1921 stock market crash.
I own GOOG also and am afraid to check the indicators today but think it would say to sale but their valuation is so so low. Most all the analyst have 600 + price targets on GOOG. Going to hang in there unless I can't take the pain.
GRock

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Originally Posted by GRock

Wanting to pick up more shares. Had bailed when the indicators said sale. The big difference with the previous dot com bubble is these company's are actually making money and have real reasonable multiples. Back in the late 90's the fed dropped interest rates to unreal market levels because of the Mexico Paso problems, Failed LA pension fund and I think a collapse hedge. Supply and demand. Low interest rates pushed money into stocks at unreal levels and the biggies could not get enough of the Dot Coms for the demand they had. A similar thing happened a few years before the 1921 stock market crash.
I own GOOG also and am afraid to check the indicators today but think it would say to sale but their valuation is so so low. Most all the analyst have 600 + price targets on GOOG. Going to hang in there unless I can't take the pain.
GRock

Both of them are good picks. If the overall climate takes a diver then I consider dropping them --to buy again later.

GOOG is grossly undervalued and AAPL is not trusted. There is a lot of brouhaha about both of them and the bears are hard at work to get them down so they don't have to cover their shorts.

Whereas microsoft can only re-hash existing business via Vista (and most corporations, including ours don't even consider it unless 12 months have passed), the other businesses are not growing at all. I see the biggest growth potential with AAPL. No operating system has got so many admirers who don't even own it. There are tons of sites dedicated turning a PC into a desktop that mimicks OSX. AAPL looks like they are going (again) to re-invent not only the mobile phone, but also how we use desktop computers. Apple gave the world the graphical desktop (although pioneered at PARC research labs), the mouse, the clickwheel and now...? We've seen the iPhone and I reckon it is a good taster for the entire product line to follow.

GOOG is grossly undervalued. using the current analysts estimate the MOS is at over 800$!!! If I drop the growth to 20% I get a MOS in todays price range.

20% is sustainable over 10 years considering the current 180% growth rate. GOOG is risky biz because it is not established yet, but it's a hell of a good bet and profits from the .com paranoia. What people forget is that the .com stocks never posted a SINGLE PROFIT. Whereas GOOG rakes it in! They are in a very good position in becoming the most dominant advertising/media company this decade.

I'd hang on to both for a bit but sell on an over 7% drop.

[kiki888]

My calculation of the MOS for Apple is the same as GRocks'. My numbers are from MSN. EPS -2.76. Analysts' projected five year earnings growth rate is 19.5. As this is less than the historical equity growth rate (which is somewhere between 27-38), 19.5 becomes the Rule #1 growth rate. As the average historical P/E is in the 50s, I used double the Rule #1 growth rate to come up with a future P/E of 39. Running this through my calculator gives me a MOS of 79.

[GRock]

U U G G H !!!

On my charts got the 3 arrows and bought this morning and then got clocked by the pixar option story from WSJ. Dropped 3 % before I knew it. Will have to wait to see what happens Monday. Could be buying high and selling low again. Bummer.

Anybody else get caught?

GRock

[Justin]

NEW YORK (CNNMoney.com) -- Apple Chairman and CEO Steve Jobs, whose company's stock-options practices are already the subject of a Securities and Exchange Commission probe, agreed to a large stock-options grant to a key filmmaker at his Pixar Animation Studios in 2001 as well, according to a published report.

The paper said that the options, part of Lasseter's 2001 employment contract, carried the lowest share price of the previous year - on a date more than three months before the employment contract was actually signed.

[Read The Full Article]

Here's a podcast in .mp3 format from the WSJ: http://podcast.mktw.net/wsj/audio/20...-wsjtechpm.mp3