As CNBC pointed out RIMM is levered to the financials. With every bank cutting payrol on their way to getting back in the black(ish), with every job cut there is likely one less Blackberry user. Meanwhile, worldwide, 6M iPhones are expected to be sold. Yet my concern is if Mac sales will continue to remain strong. My view, as I’ve shared before, is that the growth model we had earlier in the year needs a 30% haircut to properly reflect the economic downturn.
Eric I was wondering if you could provide more color on what you mean by 30% haircut. The Iphone grew 860% YOY last quarter so 30% gives you what kind of growth? Mac’s were going at better the 50% YOY and then dropped to about 20% growth last qtr. Are you saying another 30%. IPod unit growth has slowed to flat to up about 10%. Are you saying another 30%? If you look at the the analyst earnings forecast most of them have already taken the EPS down significantly from earlier in the year so there is plenty of room for upside surprise especially with the deferred revenue from the Iphone. That said I don’t see the multiple moving up until the rest of the market turns.
RIM announces a warning, it’s stock tanks in Europe (down 13% at one point), then recovers in N/A to gain (percentage wise) more than rival Apple, which RIM is loosing sales to, and there is no indication that iPhone sales are down.
Disclosure: I’m not trading AAPL right now and have a smallish long position.
Guess you missed the trip from $88 to $96 today then? Keep chewing on that ice, you’ll break through eventually!
Oh, and I’ll add that polar bears, like Eric, enjoy absurdly cold weather!
I’m waiting for all the wash sales to settle in AAPL. The trade I did in AAPL was on 11/14 and so, yes, AAPL wise I’ve missed on some action. However, action in several other stocks have made Apple’s run from ‘06 through ‘07 look like peanuts. Nevertheless AAPL wise, my snowblower will have to keep me warm.
Many of you are missing the point. Either that, or you’re just looking and hoping for the misfortune of Apple. RIMM’s problems are due to Apple’s successes. RIMM’s former customers are becoming Apple’s new customers.
RIMM’s issues are its own and many of its own making. Launching consumer handsets in November is lunacy. There are 10,000 apps available via of iTunes for the iPhone/iPod touch platform. What’s RIMM’s response?
Lesson: Don’t show up at a gun fight bearing a water pistol.
The iPhone represents a clear and present danger to RIMM and its performance. Is this a surprise?
I do believe the consumer is in deep trouble. I suggest we’ll see small sequential declines for both iPhone and iPod because of this. On the positive side, the upgraders within the iPod line will be jumping up to the Touch and we’ll see a significantly larger mix of this higher margin iPod sold. Revenue will therefore not be reduced in proportion with the unit reduction.
With the iPhone, the building deferred revenue base will also provide some insulation to flat to slightly reduced volumes.
Luckily, with expectations being reduced everyday, as long as we don’t have some disaster with the Mac we’ll have a very pleasant beat on our hands.
As for RIM, they were late with their new products, and the Storm is a significant disappointment. They are losing share in the consumer space (don’t forget that 60% of their new activations last Q were non-enterprise), and sales will be dormant in the enterprise space due to the economy.
Overall, I think it’s a great time to buy Apple. If we can get the market to move (a very big if), there will be a lot of money on the sidelines looking for a great story to join in on. It’s there, we just need to get this party started.
The trade I did in AAPL was on 11/14 and so, yes, AAPL wise I’ve missed on some action. However, action in several other stocks have made Apple’s run from ‘06 through ‘07 look like peanuts.
Exactly! Go chase those good stocks, Eric, and stop wasting your time here.
The trade I did in AAPL was on 11/14 and so, yes, AAPL wise I’ve missed on some action. However, action in several other stocks have made Apple’s run from ‘06 through ‘07 look like peanuts.
Exactly! Go chase those good stocks, Eric, and stop wasting your time here.
Very OT: He is right. For example, folks who have bought MOS on Jan 12, 06 is sitting on a double despite the devastating decline from ATH, whereas AAPL long is barely breakeven.
The trade I did in AAPL was on 11/14 and so, yes, AAPL wise I’ve missed on some action. However, action in several other stocks have made Apple’s run from ‘06 through ‘07 look like peanuts.
Exactly! Go chase those good stocks, Eric, and stop wasting your time here.
Very OT: He is right. For example, folks who have bought MOS on Jan 12, 06 is sitting on a double despite the devastating decline from ATH, whereas AAPL long is barely breakeven.
MOS
12/4/06: 21.63
12/4/08: 27.00
AAPL
12/4/06: 91.12
12/4/08: 92.96
Do you have a better example? Pick your dates—we both know that hindsight is always 20/20…
I still maintain that Eric is right—he should be chasing his good stocks instead of frittering away here.
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