Weekend Updates

  • Posted: 20 July 2012 11:57 PM #46

    lovemyipad - 21 July 2012 02:36 AM

    Looking at charts…  OMG, why didn’t we ALL short CMG?!?!?!?!  Holy schmoly!

    I never understood why it was flying so high to begin with, as I think the food is unremarkable. 20% in one day.  Ouch.  The same could happen to AMZN. 

    It’s all in the timing…

         
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    Posted: 21 July 2012 12:02 AM #47

    I’m just gritting my teeth when it comes to AMZN…may end up being an earnings play at this rate.  (Fortunately, I kept it to a pretty small side bet.)

    By the way, what is with all of you / what is up with me LOL ?

    I’m like a short-short-term Bull - / Bear + compared to the rest of you.  Net long same as always, but I haven’t bought any AAPL earnings trades yet.  Man, I must really be missing something…or worse yet, missing _out_ on something as soon as Monday open… :( wink

    [ Edited: 21 July 2012 12:15 AM by Mav ]

    Signature

    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.

         
  • Posted: 21 July 2012 12:13 AM #48

    Gregg Thurman - 21 July 2012 12:40 AM
    Mav - 20 July 2012 08:13 PM

    The good news is even if AAPL DID fall on its face with a Red October-esque “light” quarter as in Q4 2011, guidance would seem to point to a revs number of $39B at the very worst.  So even under an extremely pessimistic forecast, Apple should beat the Street consensus handily (for whatever that’s worth in the era of unaccountable, shadowy/stupid whisper numbers).

    Personally, I think even with a so-called “meh” quarter, Apple could easily meet my early, conservative projection of $40.8B revs / $11.21 EPS from late April.

    I’ve mentioned this before, but it bares repeating: Light volume with a morbid PPS has signaled Institutional apathy towards Apple’s earnings in the past.  This current “run up” is by far the clearest indication that the Institutions are thinking this way, of all prior periods.

    Unlike October 2011, a light earnings report is not going to catch Institutional investors off guard this time around.  In keeping with TCs oft repeated statement that iPhone sales would be down sequentially, I think Institutional expectations have a low number baked in.  Unless Apple surprises, any short term pop we get will come from those that don’t pay attention.  Longer term it will be TC’s comments/guidance that will fuel AAPL.

    Still, looking at the quarters I believe Apple has missed numbers in the past (including Oct 2011), a total of six, AAPL popped from pre-earnings Friday intraday low 4.41% (on average) to day after earnings intraday high.  That intraday high has not held through Weekly expiry for any of those 6 periods.

    I have revised my FQ4/2012 Guidance forecast to $9.25.  Preliminarily, I believe that translates to actual EPS of $13.85.

    Do you think institutions felt the same apathy for Q1 earnings? Volume prior to earnings showed a similar low volume pattern.

    I have a feeling Apple will surprise this quarter. China customers have little reason to wait til January for the iPhone 5 as hardly any of them have access to 4G.  Verizon’s numbers also indicate the 4S is still chugging along.

         
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    Posted: 21 July 2012 12:16 AM #49

    Divvy remains a wild card.  No one knows when they need to be holding AAPL to get it just yet.  And there’s a tiny possibility that Tim will raise the dividend before it’s actually given for the first time in a long time (granted, I think the odds are quite remote).

    Signature

    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.

         
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    Posted: 21 July 2012 12:29 AM #50

    Recommended reading from the increasingly news-analysis-oriented (which is a good thing) John Paczkowski of All Things D/WSJ.

    First, it’s Google complaining about patent attacks.  Now, Google wants FRAND-type licenses on proprietary, non-FRAND-related tech from Apple because Apple’s stuff is great and everyone likes it and it should be made into a standard that anyone can license for a song.  Suuuuuuurrrrreee.

    http://allthingsd.com/20120720/google-claims-popularity-has-made-some-apple-patents-de-facto-essentials/

    Signature

    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.

         
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    Posted: 21 July 2012 01:44 AM #51

    Mav - 21 July 2012 03:02 AM

    (...)
    By the way, what is with all of you / what is up with me LOL ?

    I’m like a short-short-term Bull - / Bear + compared to the rest of you.  Net long same as always, but I haven’t bought any AAPL earnings trades yet.  Man, I must really be missing something…or worse yet, missing _out_ on something as soon as Monday open… :( wink

    Yes, you are decidedly lacking impatience. wink

         
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    Posted: 21 July 2012 01:49 AM #52

    No seriously, what am I not seeing that the rest of you are?!

    Have I gone…too conservative?  Turned Last Minute Chicken?  (No plans for that topic this time around.)

    Or might my technicals-addled instinct (or what passes for it) actually get me a better entry point?  I kind of refuse to believe that could be true given the collective wisdom of the board, and yet that’s exactly the short-term trading hypothesis I’ve committed myself to.  It’s like I’m some kind of…contrarian.  Which I’ve been known to be from time to time, but with AAPL at this point in time…it seems weird.

    [ Edited: 21 July 2012 01:51 AM by Mav ]

    Signature

    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.

         
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    Posted: 21 July 2012 02:11 AM #53

    Mav - 21 July 2012 04:49 AM

    No seriously, what am I not seeing that the rest of you are?!

    Have I gone…too conservative?  Turned Last Minute Chicken?  (No plans for that topic this time around.)

    Or might my technicals-addled instinct (or what passes for it) actually get me a better entry point?  I kind of refuse to believe that could be true given the collective wisdom of the board, and yet that’s exactly the short-term trading hypothesis I’ve committed myself to.  It’s like I’m some kind of…contrarian.  Which I’ve been known to be from time to time, but with AAPL at this point in time…it seems weird.

    Mav, I gotta say…you’ve been trading like a disciplined trader.  IMHO, from what I have observed / you have reported, learning technicals has indeed improved your entries, exits, and risk management.  WAY TO GO!!!

         
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    Posted: 21 July 2012 02:21 AM #54

    Well, in the interests of tracking my progress and sharing a little bit without being _too_ Action Alerts Plus (though I think it’s fairly easy to get a decent idea of how I’m not exactly outperforming anyone here):

    AAPL: 
    -No significant risk until Jan 13 / Apr 13
    -VERY DIVIDED on whether to act on the Aug 12 calls I’ve hedged with 605s (provisionally, somewhat successfully…hedged around 25-26, now trading at around 21)

    AMZN (Jul 27 BPS):  Just…just shut up! LOL

    GMCR (Jul 12 calls) - I hate their crap coffee offerings, and yeah maybe having my side bet decimated had something to do with it

    LVS (Jul 12 calls) - Bad roll of the dice - side bet

    LNKD (Jul 12 put then Jul 12 follow-on BCS, which must be some wacky options strategy formed after-the-fact) - Miraculous comeback from net -50%ish or more to net +20%ish on all bets made, became a bit larger than a side bet

    [ Edited: 21 July 2012 02:25 AM by Mav ]

    Signature

    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.

         
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    Posted: 21 July 2012 02:31 AM #55

    Mav - 21 July 2012 04:49 AM

    No seriously, what am I not seeing that the rest of you are?!

    Have I gone…too conservative?  Turned Last Minute Chicken?  (No plans for that topic this time around.)

    Or might my technicals-addled instinct (or what passes for it) actually get me a better entry point?  I kind of refuse to believe that could be true given the collective wisdom of the board, and yet that’s exactly the short-term trading hypothesis I’ve committed myself to.  It’s like I’m some kind of…contrarian.  Which I’ve been known to be from time to time, but with AAPL at this point in time…it seems weird.

    You just need to embrace your bear side.  :wink:

         
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    Posted: 21 July 2012 02:32 AM #56

    I was thinking johnG in the back of my mind.  :D ‘Cept I think I’m short-short-term more conservative in terms of earnings betting than you are. wink  Am I right in that assessment?

    Signature

    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.

         
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    Posted: 21 July 2012 02:46 AM #57

    Mav - 21 July 2012 05:32 AM

    I was thinking johnG in the back of my mind.  :D ‘Cept I think I’m short-short-term more conservative in terms of earnings betting than you are. wink  Am I right in that assessment?

    I’m liking all this negative chatter. Helps to keep expectations in check.

    I’ll be satisfied if aapl can squeeze 11.5 given all the macro and product timing headwinds. The biggest issue to deal with has little to do with Apple. It’s all about the macro impact.

      cheers
        johnG

         
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    Posted: 21 July 2012 03:13 AM #58

    I am currently about 85% invested and thinking about lightening up prior to earnings to say, maybe 60% or lower.  In all honesty, I could call it a year right now and be thrilled.  Would be curious to hear where others are at invested % wise after the year we have had so far.

    My Jan 12 $300 calls may be one good choice for harvest as they were bought at $78 in April of last year (hello long term capital gains) as the leverage is lacking and the proceeds could be partially reinvested in something a little more appropriate at this stage with a Jan 14 expiration and also to start the holding period for another long term position.

         
  • Posted: 21 July 2012 08:26 AM #59

    Which way will Apple move after Tuesday’s earnings report?

    http://tech.fortune.cnn.com/2012/07/21/which-way-will-apple-move-after-tuesdays-earnings-report/


    Bernstein’s Toni Sacconaghi and Bullish Cross’ Andy Zaky offer sharply contrasting views

    FORTUNE—“We see a reasonable probability that Apple will miss consensus revenue expectations due to macroeconomic weakness in China and Europe, a product cycle lull in the iPhone, a later than expected introduction of the new iPad into China, and the late quarter introduction of new Mac notebooks.”

    So begins the note to clients issued Friday by Bernstein’s Toni Sacconaghi in which he lowered most of his estimates, from iPhone unit sales to his top to bottom lines, for Apple’s (AAPL) third fiscal quarter—one of the factors that helped drive the company’s shares down $10.02 (1.63%) for the day.

    “We are a bit torn on Apple’s stock,” Bernstein concluded, “but on balance believe that it risks treading water or underperforming coming out of earnings.”

    Contrast that with the e-mail I received from Bullish Cross’ Andy Zaky after he met with Piper Jaffray’s Gene Munster and Asymco’s Horace Dediu at Fortune’s Brainstorm Tech conference last week:

    “After speaking with them, I think this could potentially be a blowout quarter. ?The most recent blowout quarters we’ve seen in Apple took place in fiscal Q1 2012, fiscal Q3 2011 and fiscal Q2 2010. ?So they don’t happen THAT often. ?I think this quarter makes for a good set-up.

    “In fact, I don’t think I have felt more confident in how Apple is going to respond to earnings almost regardless of what it reports this quarter. ?Apple is almost certainly going to gap-up on earnings. ?I know the trading action is weak right now, but that is a major red herring.

    “I couldn’t be anymore confident in how the stock will react on earnings. ?That’s because Apple has gapped-up in 20 out of the last 26 earnings reports. ?Three of the failures happened in Q1 2006, 2007, and 2008 when Apple had a consistent trend of selling off on Q1 earnings. ?The other three failures had some major extenuating circumstances. ?First we have two back to back sell-offs in Q4 2010 and Q4 2011. ?One was the result of Apple being extremely overbought (Q2 2010) and the other was the result of Apple missing. ?The 6th sell-off happened in Q3 2008 which was the result of Apple reporting in a very poor market environment. ?So even if you don’t discount or explain those six times Apple has sold-off on earnings (three of which happened ages ago) the fact of the matter is, Apple gaps-up 80% of the time.

    “So I think market participants really need to be thinking twice about selling into earnings right now. ?As investor will soon find out, that will be a major mistake this quarter. ?If you sell ahead of the results, you will likely miss a major gap-up on earnings.”

    Apple will report its Q3 2012 earnings after the markets close on Tuesday, July 24. See here for our round-up of analysts’ estimates.

         
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    Posted: 21 July 2012 09:02 AM #60

    Iceage - 21 July 2012 11:26 AM

    Which way will Apple move after Tuesday’s earnings report?

    http://tech.fortune.cnn.com/2012/07/21/which-way-will-apple-move-after-tuesdays-earnings-report/


    Bernstein’s Toni Sacconaghi and Bullish Cross’ Andy Zaky offer sharply contrasting views

    FORTUNE—“We see a reasonable probability that Apple will miss consensus revenue expectations due to macroeconomic weakness in China and Europe, a product cycle lull in the iPhone, a later than expected introduction of the new iPad into China, and the late quarter introduction of new Mac notebooks.”

    So begins the note to clients issued Friday by Bernstein’s Toni Sacconaghi in which he lowered most of his estimates, from iPhone unit sales to his top to bottom lines, for Apple’s (AAPL) third fiscal quarter—one of the factors that helped drive the company’s shares down $10.02 (1.63%) for the day.

    “We are a bit torn on Apple’s stock,” Bernstein concluded, “but on balance believe that it risks treading water or underperforming coming out of earnings.“U

    Contrast that with the e-mail I received from Bullish Cross’ Andy Zaky after he met with Piper Jaffray’s Gene Munster and Asymco’s Horace Dediu at Fortune’s Brainstorm Tech conference last week:

    “After speaking with them, I think this could potentially be a blowout quarter. ?The most recent blowout quarters we’ve seen in Apple took place in fiscal Q1 2012, fiscal Q3 2011 and fiscal Q2 2010. ?So they don’t happen THAT often. ?I think this quarter makes for a good set-up.

    “In fact, I don’t think I have felt more confident in how Apple is going to respond to earnings almost regardless of what it reports this quarter. ?Apple is almost certainly going to gap-up on earnings. ?I know the trading action is weak right now, but that is a major red herring.

    “I couldn’t be anymore confident in how the stock will react on earnings. ?That’s because Apple has gapped-up in 20 out of the last 26 earnings reports. ?Three of the failures happened in Q1 2006, 2007, and 2008 when Apple had a consistent trend of selling off on Q1 earnings. ?The other three failures had some major extenuating circumstances. ?First we have two back to back sell-offs in Q4 2010 and Q4 2011. ?One was the result of Apple being extremely overbought (Q2 2010) and the other was the result of Apple missing. ?The 6th sell-off happened in Q3 2008 which was the result of Apple reporting in a very poor market environment. ?So even if you don’t discount or explain those six times Apple has sold-off on earnings (three of which happened ages ago) the fact of the matter is, Apple gaps-up 80% of the time.

    “So I think market participants really need to be thinking twice about selling into earnings right now. ?As investor will soon find out, that will be a major mistake this quarter. ?If you sell ahead of the results, you will likely miss a major gap-up on earnings.”

    Apple will report its Q3 2012 earnings after the markets close on Tuesday, July 24. See here for our round-up of analysts’ estimates.

    Thanks for sharing.