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To BUY or NOT AAPL stock?

ironic23 said:
AAPL has been over priced since the last couple of months. when it hit an all time high of $80++, i knew that the bubble was going to burst. it was only time before investors lost confidence in AAPL and the prices of its share began to plummate. AAPL shares have been over inflated, majorly due to small investors like us who have 'superficial' confidence in the company due to its products. don't misinterpret me though. i am a big mac fan and i think Apple has done a good job with its products. however, the shares of AAPL at $80++ is just over inflated. AAPL shares have a 'real' value of $65-70. in my opinion, i wouldn't buy AAPL if its for pure speculation. if you want to invest, yes, by all means. Apple is a stable company and its shares are worth investing in. but if you try to make a quick buck, no, AAPL is not for you. this is just my two cents worth.
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Well, I don't agree. Everybody "knows" what's going to happen in the markets, but only after it happens. Also, I think you'll find that small investors have only a marginal impact on the price of stocks. It's the big institutional investors, i.e. retirement and mutual funds, that move stock prices. When you see stocks whipsaw in price like AAPL has over the last month or so, it's the major players moving in and out. The rest of us are along for the ride. Further, I think you'll also find that the consensus one-year target price for AAPL is currently over $88.00, so apparently the people who do this for a living don't think the stock is overpriced. Finally, the only "real" value a stock has is the price the markets set for it on any given day.
 
APPL won't see the growth it's had these past two years again (probably), but will continue to increase in price over at least the next 18 mo. They will continue to be the dominant force in digital music players, and their growth for computers sales is above the industry average (and poised to go up, IMO). This is enough to justify the higher-than-average P/E, and their stock should go up.

I think the days of the bargain basement PCs are over. While lots of people will buy cheap Dells (and frankly, for a lot of people a usable $300 computer is appropriate), most consumers with some disposable income will pay a premium for a really nice machine.

If you could, wouldn't you prefer a luxury sedan over a KIA? I think more and more people will (at least, should) recognize that a computer is just as important to them as a car, and they want one that works well and looks good. Apple beats all comers in this department.

This is more speculative, but I think as media manipulation and integration becomes more important, their real competitor isn't Vista, it's the xBox 360.
 
~Shard~ said:
*cough* berkshire hathaway *cough* :rolleyes:
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different issue and topic completely

all i care about, in my small world, is that apple keeps on supplying people like me with great machines and beautiful, intuitive operating systems

i never thought of apple inc as a solid business throughout their history, but they have provided investors with a great rollercoaster ride of ups and downs...it's apple's insistence on pleasing customers over investors that have made the former very happy and the latter crashing and burning on more than a few occassions ;)
 
I've got no control over this of course, and make no bankable predictions, but this AAPL investor would be happy to see the stock consolidate at these levels for the immediate term, which for me means until the next quarterly report. Then, the numbers will call the direction. I am hoping that if Apple reports in-line performance, that the stock will move back towards $80, in a little more orderly fashion than it did earlier this year.
 
jefhatfield said:
different issue and topic completely
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Kay, that post was from over 2 months ago, and you just got around to quoting me on it now? :p ;)

Yes, of course AAPL is a different situation, but my point was that the stock price is all relevant, and some arbitrary number isn't necessarily "high". What is high for one stock is low for another and "just right" for yet another - it all depends on many individual factors with the company itself.
 
~Shard~ said:
Kay, that post was from over 2 months ago, and you just got around to quoting me on it now? :p ;)

Yes, of course AAPL is a different situation, but my point was that the stock price is all relevant, and some arbitrary number isn't necessarily "high". What is high for one stock is low for another and "just right" for yet another - it all depends on many individual factors with the company itself.
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at least since i have been interested in them, mid 80s or so, their business practices have been bad/mediocre and their products great

yet microsoft has been completely the opposite...bad products and great business practices
 
jefhatfield said:
at least since i have been interested in them, mid 80s or so, their business practices have been bad/mediocre and their products great

yet microsoft has been completely the opposite...bad products and great business practices
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Totally agree - that's one of the reasons why, a couple years ago when AAPL was at $20, I didn't think it was undervalued for the conditions at the time...
 
~Shard~ said:
Totally agree - that's one of the reasons why, a couple years ago when AAPL was at $20, I didn't think it was undervalued for the conditions at the time...
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A couple of years ago (actually a few, how time passes), when AAPL was trading below $20 a share, the market value was supported by (IIRC) more than 50% in liquid assets. This is a very, very rare situation for any company, as generally a portion of a company's market value must be subtracted to account for debt, of which Apple had effectively none. Quite the reverse. In this case, AAPL was trading far below book value. Very far. Essentially, it was being valued by the markets at below its value in outright bankruptcy liquidation. Now, if that's not undervalued, then the word has no useful meaning.
 
IJ Reilly said:
A couple of years ago (actually a few, how time passes), when AAPL was trading below $20 a share, the market value was supported by (IIRC) more than 50% in liquid assets. This is a very, very rare situation for any company, as generally a portion of a company's market value must be subtracted to account for debt, of which Apple had effectively none. Quite the reverse. In this case, AAPL was trading far below book value. Very far. Essentially, it was being valued by the markets at below its value in outright bankruptcy liquidation. Now, if that's not undervalued, then the word has no useful meaning.
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Good points. I never did any thorough reseacrh on the stock at that time, so I suppose I should have clarified that IMO the stock was not undervalued, as opposed to me performing some homework on the stock, delving into the fundamemtals and then still thinking it was undervalued. :eek: ;)
 
My dad just said to me 2 days ago that he wished he would have bought some last year when I told him to.
 
Im sure if youve read all the posts in this thread you have come to the conclusion that the stock market is a gamble. This couldnt be more true. No one knows how the stocks will fair just as someone posted earlier.

Buy for long term in companies you trust and believe in and cross your fingers. Stocks are not for the faint of heart and not for those who dont like to take a risk and definately not for those who cant afford to lose $$.

I own 200 shares of AAPL and hold my breath every single day... Some days its great when the stock will jump 5% and will equally make you sick when it drops 5%.

In my own opinion, Apple is a good stock that has projected stability. The trick is buying at the lowest possible price. The price of Apple stock has leveled out over the past month or so and is sticking around $70-$72. It will probably get a small spike in the next week due to new products but nothing substatial. My guess is it will level back to its current price within a week or two.
 
The old investor's saw is "buy what you know." If you can't explain what a company does, then you probably shouldn't own it. This rule actually works pretty well in the real world. When I bought my first AAPL in 1997, my broker gave me that condescending "it's your money" look. The conventional wisdom at the time was that Apple had no future, but I felt confident that even in a worst-case scenario that Apple would be bought out by somebody at somewhere close to the then-current values. (The leading buyout candidate was Sun -- how that worm has turned!) IOW, the downside risk was low and the upside possibilities great. This turned out to be the best wager I've ever made. But it was more than just a blind bet.
 
freeny,

ack! stocks are ownerships in companies not blackjack tables! if you do your homework and understand the company, their earnings, their expectations, their future plans, you can make a very profitable decision. yes business news and new products etc. cause quick jumps on a day to day basis (actually the jumps are mostly caused by huge mutual funds jumping in and out). as you lead into in your comment, you are starting to learn what causes these jumps. why then don't you plan on selling in a few days when it does your predicted jump and then buy back when it comes back? do it again on the next announcement, etc. etc.

buy and hold doesn't always get you to your financial goal. also don't put all your apples into one basket!
 
Is there a mutal fund - that incorporates AAPL that one can buy into? I know nothing about the market and am looking to start investing.
 
So knowing the risks and that your words are not any kind of guarantee, is the consensus that it is not a good idea to make a purchase tomorrow morning, or a good idea to buy in and then buy out in a week or so?
 
buffalo said:
So knowing the risks and that your words are not any kind of guarantee, is the consensus that it is not a good idea to make a purchase tomorrow morning, or a good idea to buy in and then buy out in a week or so?
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Flip a coin. That's about as accurate as you can be. :cool:
 
thegreatunknown said:
freeny,

ack! stocks are ownerships in companies not blackjack tables! if you do your homework and understand the company, their earnings, their expectations, their future plans, you can make a very profitable decision.
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stocks can also be riskier and more damaging than any blackjack table, too

my area (silicon valley and surrounding cities), and the high tech field, got hit like a hurricane...and took longer to recover and some say it hasn't recovered yet

the stock market is gambling...that's business 101 or mba 101
 
jefhatfield said:
the stock market is gambling...that's business 101 or mba 101
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But the edge goes to the investor, as stocks trend upward over the long-term. The fact that stocks continue to go up is what keeps the system going. This is the direct opposite of gambling, where it's the fact that the house always wins (over the long-term and over large numbers of people) that keep the system going.
 
~Shard~ said:
Always tails. ;) :)
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Unless you know the guy flipping the coin is using a two-headed coin. In that case I'd have to recommend heads.
 
WildCowboy said:
But the edge goes to the investor, as stocks trend upward over the long-term. The fact that stocks continue to go up is what keeps the system going. This is the direct opposite of gambling, where it's the fact that the house always wins (over the long-term and over large numbers of people) that keep the system going.
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what edge...what are the circumstances?

the stock goes up, hopefully, but does it beat inflation if the company survives?

what if you play blackjack and you are a card counter, and somehow you don't get caught? (don't try it you will get caught ;) )

as for slots, a portfolio of extremely conservative, blue chip stocks are a better bet, but slots will beat putting all you stock eggs in one industry

the point is, both deal with odds and both are gambling

unfortunately, few believe we will steer clear of some sort of real estate bubble and the once safest industry to invest, housing, is now in danger

the great population boom of 1946-1964 caused a great growth, and yes, overvaluation of real estate in a big bubble that continued throughout the 70s, 80s, and 90s, and at some point economic equilibrium is bound to hit...exactly when is anybody's guess...that economic swing of downvalued real estate will be the biggest financial loss in human history...some people call this the real estate bubble and type it into any search engine if you really want to spook yourself

as suzie orman says, these days the best investment is yourself...educate yourself traditionally through school and financially through, well listening to people like her and other slow and steady types as opposed to the get rich quick lot
 
jefhatfield said:
what edge...what are the circumstances?

the stock goes up, hopefully, but does it beat inflation if the company survives?

what if you play blackjack and you are a card counter, and somehow you don't get caught? (don't try it you will get caught ;) )

as for slots, a portfolio of extremely conservative, blue chip stocks are a better bet, but slots will beat putting all you stock eggs in one industry

the point is, both deal with odds and both are gambling

unfortunately, few believe we will steer clear of some sort of real estate bubble and the once safest industry to invest, housing, is now in danger

the great population boom of 1946-1964 caused a great growth, and yes, overvaluation of real estate in a big bubble that continued throughout the 70s, 80s, and 90s, and at some point economic equilibrium is bound to hit...exactly when is anybody's guess...that economic swing of downvalued real estate will be the biggest financial loss in human history...some people call this the real estate bubble and type it into any search engine if you really want to spook yourself

as suzie orman says, these days the best investment is yourself...educate yourself traditionally through school and financially through, well listening to people like her and other slow and steady types as opposed to the get rich quick lot
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Historically, the S&P 500 returns about 10% per year. Yes, inflation reduces the real return, but in general, you win in the stock market if you play the game intelligently. That's tough to do in the casinos...yes, card counting can give you an edge (and no, you won't get caught unless you make yourself obvious), but casinos are doing everything they can to take away that edge (larger shoes, shuffling halfway through the shoe, etc.).

I should have clarified things little bit. Yes, both are forms of gambling. But in the stock market, the conditions are such that you win more than you lose on average. In the casino, it's the opposite.

And I completely agree that the real estate bubble is scary. :D
 
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