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Guest Post: Is Apple Really Worth More Than The Sum Of Microsoft, Dell, Google, Facebook And HP?

Tyler Durden's picture


Submitted by John Aziz from Azizonomics

Is Apple Really Worth More Than The Sum Of Microsoft, Dell, Google, Facebook And HP?

Because that’s what the market cap suggests:

But not the book value:

Nor revenue:

And nor earnings before interest, taxes, depreciation and amortisation:

The data suggests that relative to other tech companies AAPL is significantly overvalued. And going forward there is no guarantee that AAPL can justify today’s value by keeping up its dominance of the sector. Tech is an extremely fickle and fast-changing sector where one year’s turkey can be next year’s prize pig. And AAPL’s product lineup is still dominated by products developed under the charge of Steve Jobs — it will take a while longer to fully assess whether or not AAPL can succeed at the same magnitude over the entire product cycle from conception to sales without his leadership.

But I doubt that anything like a sober look at the data will stop the Apple bulls. Because this time is different, right?


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Mon, 08/20/2012 - 19:44 | 2722106 YesWeKahn
YesWeKahn's picture

Of cause, in 10 years, everything will be apple. IWill IFuck IBernanke.

Mon, 08/20/2012 - 19:49 | 2722122 ACP
ACP's picture

...don't forget the iEBT!

Mon, 08/20/2012 - 20:03 | 2722152 malikai
malikai's picture

iGrey Goo?

Mon, 08/20/2012 - 20:32 | 2722172 sunaJ
sunaJ's picture

It's funny: this article.  What is the point of arguing whether Apple is "overvalued" or not?  The markets are completely rigged, hedge funds cannot find a footing in markets that are so unrecognizably manipulated.  Apple has the solid reputation in uncertain times and that buys at a huge premium when the herd is in motion and this herd was once considered "smart money".  It is pointless to theorize on whether Apple is good for it - of course they are not.  They are being affected by the greatest of fundamental market forces: fear & uncertainty

Mon, 08/20/2012 - 20:53 | 2722246 Jay Gould Esq.
Jay Gould Esq.'s picture

John -- Apple now peddles its wares on such home shopping "iOutlets" as QVC and ShopNBC ( right before the cubic zirconium earrings hour, and directly following the Orange Glow presentation ). One cannot recall seeing Apple products offerered on such low-end cable shopping channel outlets whilst Steve Jobs was firmly in executive contol.

The bloom is off this apple-red rose. Not for very much longer shall Apple don the market cap crown. For all things there is a season...winter fast approaches, in Cupertino.

Mon, 08/20/2012 - 20:55 | 2722263 veyron
veyron's picture

When you say they peddle on QVC, is the price actually lower?

Mon, 08/20/2012 - 21:02 | 2722273 Tippoo Sultan
Tippoo Sultan's picture

AAPL tends not to discount, regardless of retailer.

Mon, 08/20/2012 - 21:19 | 2722311 Sabibaby
Sabibaby's picture

Fear and uncertainty should have a discount regardless of the retailer!

Mon, 08/20/2012 - 21:31 | 2722325 francis_sawyer
francis_sawyer's picture

 Maxwell Smart: "Is Apple Really Worth More Than The Sum Of Microsoft, Dell, Google, Facebook And HP?"

KAOS agent: "I find that hard to believe"

Max: "What about Oracle, Gateway, Duck Duck Go, MySpace, & Acer?"

KAOS Agent: "I still find that hard to believe"

Max: "How about a Commodore 64, some Atari joysticks & my rolodex?"

Mon, 08/20/2012 - 22:18 | 2722441 i-dog
i-dog's picture

Reposted from here 2722362:


Any company whose success was built on the vision and attitudes of one man (Steve Jobs - outstanding 12 point summary by Kawasaki here: who's been replaced by a committee of technocrats ("a camel is a horse designed by a committee") can't sustain a share price this high.

Apple is/was Steve Jobs. RIP Steve Jobs. Imminent RIP Apple.


PS. Irrespective of that, "investments" in AAPL will die on the same day that the currency system is switched to a global electronic currency. Coming soon.


Mon, 08/20/2012 - 23:12 | 2722604 A Nanny Moose
A Nanny Moose's picture

Jobs didn't build that- The O'Bamabot.


Tue, 08/21/2012 - 09:21 | 2723354 Tippoo Sultan
Tippoo Sultan's picture

+1 i-dog.

Steve Jobs was a "key man" if ever the business world knew one. Steve, as you indicate, WAS Apple Computer. I do not believe the company will long reign [ market cap ] supreme without him.

Mon, 08/20/2012 - 21:25 | 2722317 notbot
notbot's picture

I hate pointing out the obvious, but when I click through to your charts, you are using TTM EBITDA.  Investors buy forward earnings. So your charts are selectively skewed down for AAPL and up for DELL/HPQ which are shrinking.

Mon, 08/20/2012 - 21:47 | 2722361 chunkylover42
chunkylover42's picture

Book Value is also heavily influenced by longevity of profitability and margins (tough to top the margins of a software company that's been around since the mid 1980s).

Mon, 08/20/2012 - 22:48 | 2722533 CrazyCooter
CrazyCooter's picture

Yup. I argued this with a coworker back in '07. If I traded the idea, I would have lost my shirt. My coworker would have been right, and have huge profits to show for it.

God made PMs for times like this. The system is fucked. I mean, there is no truth to anything anymore, unless nature is backing the system. Food, energy, land, physical security; buy some instead of apple. Well, unless those are apples for the root cellar of course.



Mon, 08/20/2012 - 23:02 | 2722577 DeadFred
DeadFred's picture

The fact that the hedgies are all-in on Apple is the biggest single danger for the company. The HFT manipulations are targeted at the hedge funds (IMO) to drive them out of the game. Only 11% are doing better than just buying SPY shares? It's not random. 89% of them are not total idiots. They are dead center in the cross hairs and if AAPL is their biggest common position I wouldn't want to ride herd with them on it. I like Apple's overpriced products but wouldn't want them in my porfolio, unless I'd bought them at $200 when I thought they were seriously overpriced. Oh well.

Mon, 08/20/2012 - 21:56 | 2722376 mjcOH1
mjcOH1's picture

> iGrey Goo?

iYlent Green for the iEntitled.

Tue, 08/21/2012 - 07:03 | 2723039 YuropeanImbecille
YuropeanImbecille's picture

short answer: YES , long answer: yes it sure is. [With reservations for cook being a beancounter rather than a visionary.].

Tue, 08/21/2012 - 10:17 | 2722323 Normalcy Bias
Normalcy Bias's picture


Mon, 08/20/2012 - 19:46 | 2722110 fonzannoon
fonzannoon's picture

Is it me or does it feel like we are a bunch of people standing in quicksand? In between the panic stricken fear of seeing us sink ever so slowly we stop and look around and say "hey how about that Apple"?

Mon, 08/20/2012 - 20:52 | 2722256 theduke2421
theduke2421's picture

not sure about "we" ... pretty sure the longs dont feel like they are in quick sand.

Mon, 08/20/2012 - 20:54 | 2722259 CH1
CH1's picture

And if they can keep the iBubble going till Oct. 1, they can show great results for their portfolios through Q3.

What else could possibly matter? 


Mon, 08/20/2012 - 19:46 | 2722114 CunnyFunt
CunnyFunt's picture

Do Max & Stacey get those i-things for free?

Mon, 08/20/2012 - 19:48 | 2722120 surf0766
surf0766's picture

Nothing is free but socialist think everything should be.


I thin apple products are overrated. Had bad experiences in the past 3 months with 2 different products from them.  I personally do not use but family members do.


Peace !

Mon, 08/20/2012 - 19:47 | 2722119 brewing
brewing's picture


Mon, 08/20/2012 - 19:50 | 2722125 Ms. Erable
Ms. Erable's picture

Never underestimate the zombie-like fanboi stupidity of iTards.

Mon, 08/20/2012 - 23:15 | 2722610 A Nanny Moose
A Nanny Moose's picture

In reality, adoption rate of these gadets in the business world is spreading like wildfire. Faster, naturally, than the ability of business to secure them

Mon, 08/20/2012 - 19:50 | 2722127 Seorse Gorog fr...
Seorse Gorog from that Quantum Entanglement Fund. alright_.-'s picture

Put your money where your mouth is and buy some puts then. Ain't nothing to it but to do it.

Mon, 08/20/2012 - 20:24 | 2722203 max2205
max2205's picture

Who said long Natgas short AAPL ??!!!

Mon, 08/20/2012 - 19:54 | 2722131 CheapBastard
CheapBastard's picture
Facebook director Thiel sold 20 million shares after lockup


SAN FRANCISCO (Reuters) - Facebook Inc director Peter Thiel sold roughly $400 million worth of shares in the Internet social networking company last week, cashing out most of his stake, according to a regulatory filing.

Thiel sold his shares on Thursday and Friday at average prices ranging between $19.27 and $20.69 per share after the end of the first lockup, which barred early investors and insiders from selling shares following the initial public offering.


Is it true he switched an bought that stuff you can't eat?

Mon, 08/20/2012 - 20:06 | 2722159 ACP
ACP's picture

Jesus F. Christ. I wish I could lose half my net worth while stuck in a garbage company and still have $400 million.

Mon, 08/20/2012 - 20:14 | 2722181 marco1324
marco1324's picture

Pocket fluff

Mon, 08/20/2012 - 20:52 | 2722244 FEDbuster
FEDbuster's picture


Tue, 08/21/2012 - 01:06 | 2722253 FEDbuster
FEDbuster's picture

Thiel could dig that out of his couch cushions.

BTW, does anyone know if Bill Gates still has his APPL shares from when he bailed Apple's sorry ass out?

Mon, 08/20/2012 - 23:58 | 2722727 I am a Man I am...
I am a Man I am Forty's picture

Uhh lemme see, Peter Thiel, his investment was $500,000, he sold more than 17M shares at the IPO of $38 for more than $646M, now just made $400M.  So he's made about $1.46 Billion and still has more shares.  You give him so little credit.

Tue, 08/21/2012 - 00:40 | 2722808 draghithebearslayer
draghithebearslayer's picture

646m+400m = 1.046b, not 1.46b. you overcredit him by 400m with a flick of your finger. well done.


Tue, 08/21/2012 - 04:08 | 2722961 MalthusWasRight
MalthusWasRight's picture

What is half a bill when it comes to the best manipulator of smart kids who are as of yet unable to legally purchase alcohol?  (Especially when CNBC legitimizes his predatory behavior with a show where kids vie to drop out of Ivy League schools to further enrich him.  I'm surprised we haven't yet seen Thiel take a seat on MSNBC...)

Mon, 08/20/2012 - 20:54 | 2722261 theduke2421
theduke2421's picture

do you really make trades after you read this? 

Mon, 08/20/2012 - 19:54 | 2722132 e-man
e-man's picture

Any Chernobyl systems technician will tell you, having one company support a large part of the economy is a recipe for success.  What could go wrong?

Mon, 08/20/2012 - 19:55 | 2722134 TooBearish
TooBearish's picture

What a fucktard- how much have u lost picking a top in  the world's leading consumer tech innovator?

Mon, 08/20/2012 - 20:42 | 2722233 dark pools of soros
dark pools of soros's picture

this isn't Reggie.. he covered to this guy's short

Mon, 08/20/2012 - 22:29 | 2722478 Spastica Rex
Spastica Rex's picture

"leading consumer fashion accessory innovator"

After FIFY, you are 100% correct.

Mon, 08/20/2012 - 19:55 | 2722135 marco1324
marco1324's picture

A bumper day for Apple but anyone going short after picking top of the tree will be laughing tomorrow afternoon. YUM YUM!

Mon, 08/20/2012 - 19:56 | 2722139 pd45
pd45's picture

Why have the Tylers turn the spot light on AAPL today. Leave it alone, all my 401(k) funds have significant AAPL component.


Mon, 08/20/2012 - 20:11 | 2722176 malikai
malikai's picture

That's your problem.

Mon, 08/20/2012 - 21:24 | 2722320 Sabibaby
Sabibaby's picture

The Tylers have been wrong about AAPL for awhile now but they'll be right eventually!

Mon, 08/20/2012 - 21:27 | 2722322 notbot
notbot's picture

Yes agree. Eventually.

Mon, 08/20/2012 - 22:34 | 2722493 Daily Bail
Daily Bail's picture

I've been long apple since the Fall of 2008 when it fell under $100 for about a month and I started accumulating.  I haven't sold any shares yet.  But I'm starting to get an itchy trigger finger with this run-up.  And for the record, I do not own a single apple product.

Go ahead and junk my ass for being honest.  I'll take the profits over pride, most days.

Mon, 08/20/2012 - 23:18 | 2722614 I am a Man I am...
I am a Man I am Forty's picture

Wow, we have an actual investor on this board, didn't know there were any.  Congratulations on such a great investment.  And as I pointed out to Aziz down below, he needs desperately to do an earnings comparison and the light will come on for him.

Mon, 08/20/2012 - 23:21 | 2722626 I am a Man I am...
I am a Man I am Forty's picture

If your timing is wrong by years and you are off a couple hundred percent then in my book you are wrong.  Stubborn buggers they are.

Mon, 08/20/2012 - 19:59 | 2722145 RobinHood73
RobinHood73's picture

In terms of the chart, AAPL to me more closely resembles INTC than the oft-sited MSFT in terms of performance during tech boom-bust. The ending parabola, follwed by congestion for roughly 5-6 mths and a a reclaiming (stop-run) of previous highs...only to fall 40% within a MONTH.  We may be very,very close to a severe ass-whipping

Mon, 08/20/2012 - 20:00 | 2722146 Meesohaawnee
Meesohaawnee's picture

i loath the day those products were invented. Not in the history of man has one "toy" so braindeadened a complete generation and society. to say they have more efficient is laughable. The opposite. Harmful when driving but hey, yhey dont care .. As long as i got my i world. Everything is good. And heres the deal appy fans. I held csco in 03 of 2000. I used to hear the same discussion. I sold and my print is in the 81 s or 82s .. Get out while the gettin is good. If this were a free and non manipulated market those puts would be gettin me a real rich!! Enjoy it while you can. You all got some guts when the music stops, and i promise, it will theres gonna be some serious pain. 600billion market cap. Yea right. theres lower hangin fruit to pic than that.

Mon, 08/20/2012 - 20:19 | 2722195 lotsoffun
lotsoffun's picture

the poor boy.  i had to buy a new phone.  i would prefer a land line with an answering machine, but i'm really old.  if i was terribly concerned, i could put 25 cents in a ny pay phone and listen to the messages.

that said, the poor boy.  did i want a google email address?  why?  if i don't have a google email address, i can't play games like angry birds.  i told him i didn't thought game playing on hand helds was adult behaviour.  he asked if i should have the gps on.  i told him no, please turn it off, the constant polling eats up the batterys, and besides, i think i know where i am. (geographically).  and if i was lost, i could consult a map, or good forbid, ask somebody for directions.

in theory, it was all a better life for us, right?  but in the end (and even at the time they first came out with power windows, and 'power' whatever - brakes, steering, ac, etc.  i'd just as soon roll the windows down myself, and lock the door, and remember where my car is.

it all supports stupididy and lazyness.

in the end, GM and MAC will be at war with each other.  on the one hand, MAC will need to buy some sort of delivery vehicle, to send the people to shove big mac's down the throats of the slobs too big to get out of bed to drive.  so - is it less people able to even walk to get in a vehicle, or more vehicles to deliver the poison?


Mon, 08/20/2012 - 21:10 | 2722294 marco1324
marco1324's picture

i would prefer a land line with an answering machine, but i'm really old.

And dont forget to always have an old cord phone handy as cordless phones dont work in a power cut...write that down.

Mon, 08/20/2012 - 22:11 | 2722432 ali-ali-al-qomfri
ali-ali-al-qomfri's picture

Marco indeed, and may I offer up this little gem

Free electricity thru telephone line

Tue, 08/21/2012 - 00:16 | 2722763 Cthonic
Cthonic's picture

Unless you have something like verizon fios, in which case you are merely using your own electricity in a rather roundabout fashion...

was fun in the old days of physically switched circuits though, being able to deafen the guy at the other end by attaching an O scale AC train transformer to tip and ring.

Thu, 08/23/2012 - 19:36 | 2732100 lotsoffun
lotsoffun's picture

and then you know what?  i had that expericence many times.  and i lived thru it.  infact.  i kind of liked it.  and when the power lines went down - sometimes we didn't have heat or hot water or electric or even running water, because the pump to the well was down.  and - god bless steve jobs  - but i lived thru it.  really ok too.  and infact - made me appreciate when things did work.

and normally - i'm polite.  but i do appreciate what a spoiled brat asshole you are. 


Mon, 08/20/2012 - 20:05 | 2722156 buzzsaw99
buzzsaw99's picture

insiders and fund managers will get rich, everyone else will get screwed the same way it always happens.

Mon, 08/20/2012 - 20:08 | 2722167 HaroldWang
HaroldWang's picture

All I gotta say is that better be an incredibly amazing phone that gets launched in September. Otherwise, it won't be pretty. 

Sorta messed up when you base an entire market on essentially one products success...or failure.

Mon, 08/20/2012 - 20:12 | 2722177 Ray1968
Ray1968's picture

one serious phone problem and that will be very SERIOUS problem with the stock.

Mon, 08/20/2012 - 20:14 | 2722182 buzzsaw99
buzzsaw99's picture

aapl, aapl, you earn so fine. miss another quarter and your ass is mine.

Mon, 08/20/2012 - 20:16 | 2722185 sessinpo
sessinpo's picture

Word is Samsung is out innovating Apple in phones now. Should be interesting to see how the patent lawsuits come out.

Mon, 08/20/2012 - 21:13 | 2722299 Renewable Life
Renewable Life's picture

two words: Apple TV

Thats what all the current hype and run up is about!

Mon, 08/20/2012 - 21:28 | 2722324 Sabibaby
Sabibaby's picture

and how will that be any different than cable or netflix????


Oh wait.... I see there's an apple logo on it.... iWant

Tue, 08/21/2012 - 02:06 | 2722917 the tower
the tower's picture




Mon, 08/20/2012 - 20:11 | 2722173 Cone of Uncertainty
Cone of Uncertainty's picture

Ask Reggie how long Apple can keep this up.

If you can find his face.

Mon, 08/20/2012 - 20:11 | 2722175 Pubcoceo
Pubcoceo's picture

Has he ever used windows vista, or an HP or Dell product, they did it to themselves,

Mon, 08/20/2012 - 23:25 | 2722634 A Nanny Moose
A Nanny Moose's picture

Been there, done that...took so long to do anything, I missed the T-Shirt sale.

I tossed the stylus out with my last Palm Pilot.

Mon, 08/20/2012 - 20:24 | 2722204 JustObserving
JustObserving's picture

"the market cap of Apple is now greater than three times that of all of the world’s publicly traded gold and silver equities. "


Mon, 08/20/2012 - 20:43 | 2722235 dark pools of soros
dark pools of soros's picture


Mon, 08/20/2012 - 20:51 | 2722249 FieldingMellish
FieldingMellish's picture

As much as I admire Apple's products for their design sense, this speaks volumes about both Apple's overvaluation and the PM equities MASSIVE undervaluation.

Mon, 08/20/2012 - 20:29 | 2722209 ClaymoreStoor
ClaymoreStoor's picture

Im a big fan of ZH and basically read it every day but I gotta say, the anti-Apple tirades lately come off a little like sour grapes -- bitterness that they didn't get in on AAPL when they could.  Yes, eventually AAPL will flop and dump but if there is money to be made on the way up then so be it.  The fact is, AAPL has been a once-a-decade stock and if you didn't get in earlier then I'm sorry, but bashing those who have made a small fortune riding it to this point isn't productive.  I, personally, do not care what AAPL or any other stock may represent socially/politically/philosophically.  ZH obviously does.  My only question is whether a stock will make me money.  AAPL for the last several years has been a printing press for investors.  That's all that matters to me and that's all that should matter to anyone else.  


Mon, 08/20/2012 - 20:37 | 2722227 Fukushima Sam
Fukushima Sam's picture

Et tu, ClaymoreStoor?

Mon, 08/20/2012 - 20:49 | 2722236 sunaJ
sunaJ's picture

"I'm a big fan of ZH and basically read it every day but I gotta say, the anti-Incarcerated Amerika, Inc. tirades lately come off a little like sour grapes -- bitterness that they didn't get in on Incarcerated Amerika, Inc. when they could.  Yes, eventually Incarcerated Amerika, Inc. will flop and dump but if there is money to be made on the way up then so be it.  The fact is, Incarcerated Amerika, Inc. has been a once-a-decade stock and if you didn't get in earlier then I'm sorry, but bashing those who have made a small fortune riding it to this point isn't productive.  

I, personally, do not care what Incarcerated Amerika, Inc. or any other stock may represent socially/politically/philosophically.  ZH obviously does.  My only question is whether a stock will make me money.  IAI for the last several years has been a printing press for investors.  That's all that matters to me and that's all that should matter to anyone else."


Mon, 08/20/2012 - 20:51 | 2722252 Advoc8tr
Advoc8tr's picture

 I, personally, do not care what AAPL or any other stock may represent socially/politically/philosophically.

that makes you part of the problem, not the solution

That's all that matters to me and that's all that should matter to anyone else

It is all that matters to most which is why the whole system, ravaged by greed, is on the precipice of collapse


Mon, 08/20/2012 - 22:33 | 2722491 Aziz
Aziz's picture

In 2006 when I was 19 I made the call that AAPL were gonna become bigger than Microsoft. My Dad laughed, but I knew what I was seeing — all the designers, musicians etc around me were buying Macbooks, and everyone else was beginning to buy iPods. I wish I had been writing on the net in 2006 cause there were very few analysts who made that call then. Now I see that AAPL is suffocating under its new weight, and so my call has turned long term bearish. This ain't about sour grapes. 

Tue, 08/21/2012 - 00:01 | 2722724 Cthonic
Cthonic's picture

It's not a gain until one sells; when one sizeable holder sells the remainder of the herd will thunder the other way.  That could get ugly in the face of the thin HFT veneer of liquidity.  Aren't capital gains rates supposed to change next year?

Mon, 08/20/2012 - 20:31 | 2722215 lemonobrien
lemonobrien's picture

apple is worth what peoples is willings to pay; same as gold.

Mon, 08/20/2012 - 20:42 | 2722218 zebrasquid
zebrasquid's picture

AAPL got smacked fast and hard back in May...for, what, 12% in a couple of weeks?

It'll happen again this fall, maybe 20% this time.

Long term, a great company, truly is. An unparalled international millenial-brand name(ironic, since the boomers launched it but spurned it for the cheaper Windows crap (not me).  The p/e is still very reasonable, which drives it ever higher -- market cap and book value is abstract stuff to the average stock market neophyte and mo-mos could care less about such things.

A trillion dollar market cap may not be out of the question.  What's a better brand or earnings machine these days?

Tue, 08/21/2012 - 05:29 | 2722987 TheFourthStooge-ing
TheFourthStooge-ing's picture


What's a better brand or earnings machine these days?


Mon, 08/20/2012 - 20:34 | 2722219 Jim B
Jim B's picture

Their stock is as overpriced as their products! 

Mon, 08/20/2012 - 20:39 | 2722229 billwilson
billwilson's picture

BUT ... the P/E is only 12!!!! Never mind the fact that the biggets products did not exist 12 years ago and won't 12 years from now. A 12 P/E in tech land for a changeable product is a bit rich shallw e say.

Mon, 08/20/2012 - 20:40 | 2722230 dwayne elizando
dwayne elizando's picture


posted from my iPhone

Mon, 08/20/2012 - 20:55 | 2722248 zebrasquid
zebrasquid's picture

Apple is a brand like The Beatles were a brand.  Could put out a mediocre record (Get Back) and still billions of fans around the WORLD would be loyal to them.

Samsung?  They have the same brand non-cachet as, say, Nokia used to.

There are a thousand better shorts than Apple.

That said, might be a good put for the coming NASDAQ autumnal swoon - particularly if you have a need to excise anti-i-Generation demons. 

Mon, 08/20/2012 - 20:46 | 2722231 francis_sawyer
francis_sawyer's picture

Brand spanking new AAPL production & manufacturing facility in China...


Mon, 08/20/2012 - 20:56 | 2722267 marco1324
marco1324's picture

AAPL stocks everyday will keep the bailiffs away - repeat this three times every morning afternoon and evening.

Mon, 08/20/2012 - 20:57 | 2722269 theduke2421
theduke2421's picture

cup and handle pattern - buy buy buy.  the market isnt broken, it is "predictable" - these bulls will be slaughtered.

Mon, 08/20/2012 - 20:58 | 2722271 Neethgie
Neethgie's picture

Nice post john, i agree and retract my dickish statement from last night.

AAPL as a company it seems has been cannabalizing itself, i mean who wants an ipod when you can store all that music on an iphone and still call people? 


The stock will continue to make leaps and bounds until it doesnt, the perceived value of apple is contrary to any sense, far too much faith going into the stock, however the trade is definitely one direction up, because the market is stupid.

Mon, 08/20/2012 - 21:04 | 2722278 Divine Wind
Divine Wind's picture



I only had to read your last sentance to understand the totality of the reality of AAPL's standing in the market.



Mon, 08/20/2012 - 21:05 | 2722282 alien-IQ
alien-IQ's picture

When Steve Jobs dies, AAPL will crash.

Anybody remember those predictions?

Mon, 08/20/2012 - 21:11 | 2722295 XtraBullish
XtraBullish's picture

Tyler: Is the U.S. dollar really worth more (per unit) than the Canadian Dollar given that per capita, the U.S. owes more than thirty times per citizen in debt than Canadians? Answer? NO Reality: It is what it is.

Strategy: Sell your American currency units and your Euros and your Yen and replace it with APPL or NEM or GG or fucking farmland in Iowa but keep it in ANYTHING but cash.

Congrats to all AAPL shareholders that have ignored Reggie Middleton's advice. You are making HUGE coin in a great franchise. Congrats.

NEVER underestimate the replacement power of stocks (including APPL) within an inflationary spiral. Cash is trash.

End of story.

Mon, 08/20/2012 - 21:13 | 2722302 wang (not verified)
wang's picture

I guess this might explain it

August 20, 2012 5:18 PM PDT

Leaked iPhone parts assembled, fit 'perfectly'

Mon, 08/20/2012 - 21:18 | 2722313 kevinearick
kevinearick's picture

you have the supply price of the herd on the margin...

the market maker has the contract price history, a fulcrum of fulcrums, increasing p on dec v...

how many robots can you fit on the head of a pin, as you eliminate the exits?

Mon, 08/20/2012 - 21:35 | 2722339 pamriallc
pamriallc's picture

What an awesome spread trade idea. Short AAPL and go long the basket. I see a derivative trade in the making.

Mon, 08/20/2012 - 21:42 | 2722349 Cabreado
Cabreado's picture

"Neither a man nor a crowd nor a nation can be trusted to act humanely or to think sanely under the influence of a great fear."

-- Bertrand Russell

Mon, 08/20/2012 - 21:44 | 2722354 kevinearick
kevinearick's picture

california is now cutting pension payments to beneficiaries.

as ca goes...

Mon, 08/20/2012 - 21:54 | 2722372 adr
adr's picture

The question I ask is if Apple is worth more than the entire retail sector worldwide?

It is a little crazy to think that adding the value of the techs together, probably dwarfs the sector that actually sells the products to consumers.

You think of the immense infrastructure required for Exxon/Mobil and then you think of the couple buildings Apple inhabits, and the miniscule square footage dedicated to their sales.

Only the tulip scam of Wall Street could make that value possible.

Tue, 08/21/2012 - 02:30 | 2722928 onebir
onebir's picture

Remember when the land under the Imperial Palace, Tokyo was worth more than California? ;)

Mon, 08/20/2012 - 22:09 | 2722428 JR
JR's picture

If John D. Rockefeller made America great by absorbing his competition, co-opting the politicians, and breaking the barriers with monopoly, Steve Jobs in some ways has been his heir. For when H-1b visas are on the table, Apple is in line; when legislation to protect the outsourcing of American jobs is on the table, Apple is in line; when competition gets too near and ruthlessness is on the table, Apple is in line. And, finally, when American protection – via her laws to her Marines – is on the table, Apple is in line.

But when it comes time to pay, Apple misses the cut.

Apple, once again, has been working overtime seeking another repatriation holiday to avoid paying U.S. taxes on foreign earnings.

And, reports Huffington Post in February, “a repatriation tax holiday isn't the only way big firms have managed to lower their tax bill in recent years. Thirty of America's most profitable corporations paid less than zero in income taxes in the last three years, according to a November report from the Citizens for Tax Justice.”

If Apple ever did repatriate its foreign profits, the company would indeed have a big bill to pay: about two-thirds of the Apple's money is currently parked overseas, according to the WSJ.

Yet, the Center on Budget and Policy Priorities on February 14, 2012 reports that the Average Corporate Tax Rate (2000-2005) in the United States was a mere 13.4%.

Wrote Seeking Alpha’s Calpurnia last month on Apple And The Overseas Tax Showdown:

Apple's (AAPL) cash hoard is roaring, especially overseas. According to a recent report, Apple has $74 billion in overseas cash, up from $64 billion just 7 months ago ( July) and $35 billion in 2010. And Apple is not the only one. Other companies are continuing to build large piles of cash overseas. Microsoft (MSFT) has $50 billion, Cisco (CSCO) $42.3 billion, Oracle (ORCL) $25.1 billion, and Qualcomm (QCOM) $16.5 billion.”

U.S. law "allows them to defer taxes on their profits from international operations until they bring the cash back to the U.S." writes Justin Fox in a in his analysis of tax implications of overseas corporate cash hoards.

“Apple is pushing for a change in policy. In a recent earnings conference call, Apple CFO Peter Oppenheimer states:

Repatriating the cash from offshore would result in significant tax consequences under current U.S. law. We have expressed our views with Congress and the administration. We think that the current tax laws provide a considerable economic disincentive to U.S. companies that might otherwise repatriate the substantial amount of foreign cash that they have. And that's our view, and we've expressed it.

“According to a congressional subcommittee report, the 2004-2005 Bush repatriation tax holiday ‘cost the Treasury at least $3.3 billion in revenue over ten years,’ and furthermore ‘produced no appreciable increase in U.S. jobs or domestic investment, and led to U.S. corporations directing more funds offshore.’"

Mon, 08/20/2012 - 22:16 | 2722444 kevinearick
kevinearick's picture

is Apple an insurance company?

what is Buffet's response?

Mon, 08/20/2012 - 22:21 | 2722453 kevinearick
kevinearick's picture

how do you avoid taxpayer patsy status?

Mon, 08/20/2012 - 22:29 | 2722477 I am a Man I am...
I am a Man I am Forty's picture

Can we see a net income chart?  Where's the net income chart?  What does that one look like?

Would like to see a profit chart.

That's right, let's just skip the profit chart.  Doesn't matter.

Apple: $40B plus

The Others: $32B

I think you should post the most important one first, don't you?


Mon, 08/20/2012 - 22:43 | 2722515 Aziz
Aziz's picture


EBITDA covers that.



Mon, 08/20/2012 - 23:02 | 2722527 I am a Man I am...
I am a Man I am Forty's picture

No it doesn't.  If you knew the difference I guess you would understand.  You can google it.  


Yes, I'm being a smart ass but you should do an actual earnings comparison.

Mon, 08/20/2012 - 22:46 | 2722524 I am a Man I am...
I am a Man I am Forty's picture

edit $40B vs. 37B  typo

Mon, 08/20/2012 - 22:59 | 2722566 kevinearick
kevinearick's picture

make uncertainty your friend, and the robot masters will lead the others over the cliff every time.

in nature, adaptive skill reduces umcertainty, in a negative feedback loop. in empire, joining a peer pressure group reduces uncertainty. the net to you is inc return on dec risk, in quantum. the others get incrememtal inc p on dec v, until...

Mon, 08/20/2012 - 23:14 | 2722609 MeelionDollerBogus
MeelionDollerBogus's picture

AAPL is garbage. Always has been, always will be. Cheaper devices with higher durability are always available. Always have been. Better warranties too. Apple's rising price correlates only to the stupidity of people who borrow, beg and steal to own a piece of their garbage because their own IQ tends to suggest to me they are no better compared to their betters in society.

Mon, 08/20/2012 - 23:19 | 2722621 nathan1234
nathan1234's picture

I for one will never buy an Apple product again One Iphone has been a collossal waste.

This stock is sickeningly overpriced.

Cant short it as it appears that the Fed is behind the manipulation.


Mon, 08/20/2012 - 23:32 | 2722658 Likstane
Likstane's picture

If you think I'm going to give up,(hypothetically, because of the accident in Puget sound), 23 of my precious silver discs for one share in a company that I have no idea what they do, other than make some computer thing my kids play angry bird on, then you probably wouldn't want to go fishing with me.  Just sayin'

Mon, 08/20/2012 - 23:38 | 2722676 Bear
Bear's picture


Tue, 08/21/2012 - 00:32 | 2722795 draghithebearslayer
draghithebearslayer's picture

Don't play dumb OP. Everyone knows book value, revenue, and ebitda are anything but a leading indicator of stock price.

Tue, 08/21/2012 - 00:43 | 2722812 mharry
mharry's picture

Well when you make iCrap for iLemmings, it's a pretty easy game. Convince the lemmings they're so smart and cool if they buy iCrap, they will line up and camp out to get it. Give them an interface that my deceased Downs' Syndrome sister could figure out, but let them think they're the smartest people on the planet, pure genius.

Tue, 08/21/2012 - 01:57 | 2722912 Me_Myself_and_I
Me_Myself_and_I's picture

Apple core?

(Tell me more)..

Tue, 08/21/2012 - 02:06 | 2722918 the tower
the tower's picture

Apple invented a new product class: rolling out something that wasn't there before is very different than competing in an existing market. Their products are great, but the economic boom allowed people to buy them, and overvalue the stock: Apple rode the wave of cheap credit.

We are now about to enter a replacement market - the last wave of new smart phone buyers is playing out now - while at the same time the tech will get very cheap - consumer tech products are becoming commodities, hence the lawsuits: it's all about grabbing consumer real-estate NOW.

Apple can create new products - a TV or whatever - but that's a replacement market too. Their suggested cablebox is a better idea: content is what sells (i.e. apps, media), not hardware.

I expect Apple to move deeper into content, if not they will become a marginal luxury brand, not worth it's stock price by far.

The stock price is all about expectations for future gains, but can Apple deliver?

Tue, 08/21/2012 - 02:15 | 2722921 Troy Ounce
Troy Ounce's picture



Well, AAPL has a higher fuckability index than MS.

Tue, 08/21/2012 - 04:03 | 2722958 EmileLargo
EmileLargo's picture

So long as the fad for overpriced shiny toys continues, the stock stays high. Apple is one product flop away from seeing its share price cut in half. And the competition is getting more nimble and more aggressive. A good time to sell the stock and cash in the profits if you own it.

Tue, 08/21/2012 - 08:53 | 2723266 mrktwtch2
mrktwtch2's picture

adjusting fro infaltion hit 618 billion in 99 which would be 722 billion in todays dollars ..hence appl still has a way to go..

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