Agathon to discuss Apple's stock price

[Asher]

Why not. I own a MacBook Pro and an iPod and I said the same thing. I'm not only ignored, I'm a "stupid idiot" (x12).

[snoopy369]

Not that i'd expect to see them here, but I'd love to hear from the stock knowledgeable folks here about what this looks like. I'm only somewhat knowledgeable - grew up in a stock trading household with the Nightly Business Report, but I haven't heard Paul Kangas except very briefly in a decade... - so i'm not entirely sure how to read this, but here goes.

I'd say the $200 was clearly a bit overvalued at the time, as tech stocks often are. AAPL needed to outperform, AND at least project the expected projection. They didn't, so they went down.

However, from seeing some of the option trading and such, several of the forbes articles indicate that some of the negative was profit-taking and from what I recall that is usually reversed the next day on 'strong' stocks, which AAPL clearly is.

I don't think you can take one day's performance and say something meaningful about a stock; and I'd probably buy AAPL today if I had money to spend buying things, and didn't mind a riskier investment (as all tech stocks are). I also would have sold at 200 based on the previous performance, expecting another downturn at which point I could buy it again; today.

If only GOOG would follow this pattern, a lot of money could be made...

[Asher]

I don't think you can take one day's performance and say something meaningful about a stock; and I'd probably buy AAPL today if I had money to spend buying things, and didn't mind a riskier investment (as all tech stocks are).

It's down all month consistently (~35%), not just one day.

[Asher]

So where is everyone?

I'm particularly interested in Drogue and Agathon's assertions that this is all due to the "coming recession". Drogue's comment about Apple being a "luxury good" and having sales drop off from it is also at odds with both common sense and industry experts.

Apple sells to a segment of the market that is historically least affected by economic downturns. Most experts don't expect them to be affected much, if at all.

I'm so tired of kicking ass without any opposition. Somebody with a clue please say something.

[OzzyKP]

From December 27th (about the start of my graph above):

Apple is now unquestionably the pre-eminent computer company, and the stockmarket knows it. Apple's phone has redefined the way people will interact with mobile devices, and their touch portable music players are a generation ahead of anyone else's, in particular the abortion known as the Zune.

Just for a laugh, some idiotic Apolyton posters suggested last year that Apple was overpriced... Today AAPL was trading at over $200 a share. This is yet another failed prediction of doom from Apolyton's anti-Apple brigade, who, if nothing else, have demonstrated their utter incompetence in tech prediction for the whole of the 6 years I have been a poster here.

The real question is what was Apple trading at in December 2006.

[Asher]

The comment wasn't made in December 2006, and the comment still held. The P/E on Apple stock has been way out of whack for years, making it a volatile stock. Apple stock's high price is based on high expectations of future growth that single-handedly rest on Jobs' reality distortion field.

Yes, Apple is doing extremely well (even today, when the stock tanked). The problem is the price of Apple's stock hasn't been supported by their performance for years now. It can pay off if they can continue to show phenomenal growth, but sustaining such growth is unreasonable and unlikely. My words were, when I said it was overvalued, that "Some day, Apple's stock is going to crash -- and hard" as soon as a bad estimate came out. That's happened exactly as predicted, though you would have still made money on the stock if you bought it a year ago and sold it now, of course. But that doesn't change the fact that it's overpriced.

[Agathon]

Originally posted by OzzyKP

The real question is what was Apple trading at in December 2006.

About $80 a share.

I can't quite remember when the really big discussion about Apple being overpriced was, but it was a long long time ago, before my year away from Poly (which probably means Fall 2006). At the time Apple was trading at $75 a share and the same clowns who are acting up in this thread were saying that Apple was massively overvalued then. You can go and look in the archive if you don't believe me.

Look, these people are simply mad. How can they be taken seriously when they said the stock was massively overvalued when it was worth half what it is today and a third of its maximum value over the last year. The clowns in this thread have zero credibility on this matter.


They just have no clue.

[Agathon]

Originally posted by snoopy369

I'd say the $200 was clearly a bit overvalued at the time, as tech stocks often are. AAPL needed to outperform, AND at least project the expected projection. They didn't, so they went down.

Some analysts were predicting that AAPL would top $250 a share, so $200 wasn't that unreasonable.

Look, this is a storm in a teacup. For one reason or another AAPL investors are inclined to bolt when the market as a whole starts turning down. It already happened in November, and there was a bounce back to even higher levels than before.

[Ben Kenobi]

Asher's short must have finally come through for him.

[Asher]

Originally posted by Agathon
Some analysts were predicting that AAPL would top $250 a share, so $200 wasn't that unreasonable.

That's the most asinine logic I've heard in quite some time.

$250 is unreasonable, $200 is unreasonable. The earnings per share just aren't there. I don't think you understand the whole underlying purpose of stocks at all.

The fact that the stock went down so much so fast illustrates the value of it isn't supported by the underlying earnings. If it WAS, then the fact that Apple had record earnings would have a POSITIVE effect, not a huge negative effect.

I tried to explain this to you then, I'm explaining it to you now, but you still don't get it. You don't have the slightest idea of how the stock market works or how value is determined, or when to buy. Here's a hint: Buying at $200 on a stock that already has a dismal P/E in a volatile market like technology is a bad idea, yet you whole-heartedly recommend people buy it up last month. If they had, you'd have lost them a LOT of money.

Stick to your day job.

Look, this is a storm in a teacup. For one reason or another AAPL investors are inclined to bolt when the market as a whole starts turning down.

What do you not get? The market was positive today.

This has nothing to do with the overall market, and everything to do with Apple's forecasts. That's obvious to anyone who can read a frickin' newspaper, or with any kind of analytical ability.

[Flubber]

Apple? I got Mrs Flubber one of them Itouch things-- expensive but I must say its pretty cool

[Agathon]

Originally posted by Flubber
Apple? I got Mrs Flubber one of them Itouch things-- expensive but I must say its pretty cool

I have one of those. I use it as a PDA. Have you seen the jailbroken ones? They are truly awesome. I'm hoping that game developers will jump on board as there's a lot of potential there.

[notyoueither]

This thread reminds me of an argument over the quality of the caviar on the Titanic.

[Asher]

Originally posted by Agathon
I have one of those. I use it as a PDA. Have you seen the jailbroken ones? They are truly awesome. I'm hoping that game developers will jump on board as there's a lot of potential there.

A lot of potential?

How so?

The hardware,especially the graphics (2D/3D), is gimped.

There are PocketPCs with touchscreens and far more capable hardware, along with fully developed SDKs for game development.

This isn't a new feature nor is it an area for a whole lot of potential. Been there, done that. I remember playing AOE on my iPaq many years ago.

[Asher]

Originally posted by notyoueither
This thread reminds me of an argument over the quality of the caviar on the Titanic.

Maybe you can explain to Agathon the concept of the speculative bubble, or the purpose of P/E. The price of Apple then, and now, is still overvalued by virtually every measurement.