Wednesday, November 14, 2012

Discussion Topic 11/12/2012


  1. Tian Tan
    1. From the product perspective. I think ip5 did not surpass the expectation. There is not much surprise and the ip4's shape is better than ip5 as many people say so although ip5 is thinner and lighter. ip4, on the contrary, is a legendary product and is, in my view, the summit of iphone history. Combined with the fact that most emerging markets are already saturate, I do not expect a better than expected sales of iphone in the near future. As for ipad mini, it hit a unexpected successful sales figure. However, mini will calnibalize the sales of ipad and the profit margin of mini is way lower than ipad.

    2. From techniqal analysis perspective. The price has descended into bear market territory, and unless there is big positive surprise, it will be very hard for the price to go back to bull market territory, with such a big capitalization. But as the decrease in recent several trading days is speeding up with big volumes, I think there will be correctrion of price and a short-term increase. However, I do not feel positve on Apple's long-term price trend.

  2. Xiao Zhong
    The same as eBay and other technology companies, Apple needs more innovation and so-called “selling points” to sustain its long-term growth—it faces a lot of strong competitors like Samsung, whose GALAXY series really pose a headache for Apple and stiffen the already fierce competition.

    But I would still remain optimistic about Apple’s future—(1) Apple has created an exceptionally user-friendly concept for its customers through its simple and easy-to-navigate interface, in which aspect no other cell phone/PC makers could closely compete. (2) Though the Steve Job-less Apple had once raised public concern about its future, the new management team still remains one of the best—Tim Cook’s focus on creating a team willing to apologize when it messes up really matters now because technological advances take time and even failure to realize. (3) As Kalyan mentioned today, to evaluate a company it is important to look at both its management and potential to grow. I think Apple still has great potential in the sense that it has an open, innovative and collaborative culture which would allow it to continue making progress along the way.

    So the problem with Apple is more like entering a bottleneck phase—as long as it can bring more ORGANIC innovations, it is still the exceptional and great Apple.

  3. Mengyao Kong
    I agree with Tian and I want to add two things.
    I use two reasons to persuade myself not touch Apple again.
    1. Screen slide. I compare Samsung Galaxy one, iPhone 4, HTC, the Apple is the best and the other two is nothing compared with Apple. Years later, when I compare iPhone 5, Galaxy 2, the difference is narrowed down. Apple is still the best; however, the Galaxy is also pretty good. It also happened with the tablet made by Windows when I make the comparison with iPad. It is a simple idea but it represent the technology advantage of Apple is shrinking.
    2. Product Innovation
    What did we see after Mac, it is iPod, then is itouch, then is iPhone, then is iPad. After Mr. Jobs died, what do we expect? Make the iPhone lighter, thinner, make the iPad smaller. It is not product innovation. A lot of people talk about the iTV, we are still waiting for that and so far, the iTV is hundred bucks and don't have a lot of users. I don't see Apple is not a good stock anymore but I don't think it will go back to 700 within one year. It lost its innovation ability. People always wander around to see whether the Apple innovation is from Mr. Jobs or the sprits could be transferred to others, which were proved it cannot be at this time.

  4. Glenn Alpert
    It's fairly understandable that Apple's share price will eventually hit some kind of a peak, face a correction, and then reach an equilibrium. As a company goes from a growth stock to a value sock, the price does not climb as high, but it becomes more stabilized. Apple's largest issue to deal with is it's cash, which it should be either re-investing in itself or putting to good use; it needs to put that cash to work in some way. It will be interesting to see how apple uses this extra money, but we will have to see what happens, now that the election is over, and companies have a clearer idea of the tax policies that will be in place for the next 4 years.

  5. Pian Li
    The ratio of price to earnings theoretically measures investors’ expectations of a company’s growth, such that expectations for future growth of earnings will propel the stock price resulting in a higher P/E ratio. Thus, part of the reason why FB has a low P/E ratio is due the disappointment of the new products of Apple like iphone 5 (excluded google map) and mini pad, the potential saturation of the smart phone industry and a highly competitive industry in smart phones (Samsung). Maybe this is the bottle neck of the stock. The later performance will depend on the performance of the company.

  6. Tim Shoji
    I want to caution against drawing too much conclusion about the future of Apple based on these short-term price fluctuations. Yes, it's entirely possible that the current slump is the start of a long-term decline, but it's definitely too soon to tell. Apple is still adjusting to its new leader and I believe it will take some time for the new management team to adjust. Once things settle down, I believe it will be more appropriate to analyst the the long-term outlook of Apple.

  7. Amine Bensaid
    It is obvious to us all that Apple stock is dominated by the bears at the moment. The stock broke major support levels, and it is trading way bellow it's 61.8% Fibonacci retracement which is considered as a strong downtrend. The next support level for Apple is $518.82 and after that I do not see a clear support level before $488.5.

    That said, the company's products are indeed suffering from innovation lag compared to its competitors, and that also translated into the company second earnings miss of the year. On the other hand, the company saw an increase of sales of 50% from last year while their COGS increase by around 25%. Apple is also famous for it's huge amount of Cash, cash equivalents and marketable securities which is around 121 Billions.

    I think apple decline is basically a technical trade due to the nature of the actual market rather than the company under-performing,.

  8. Zhishuo Zhang
    1.Technical analysis: clearly that AAPL has entered a bear trend. MA5 broke through all other moving average line. The order of these lines from bottom to top are 5,10,20,30,60, meaning totally bearish. I see support at roughly $520 where longterm trend line and lowest price in May intersect. Therefore, the trend is likely to touch the support price once and move up to the MA20, then drop and test the support level once again.
    2. Bright side : the innovation of apple is not only about the products themselves. Jobs created this great business model helped apple dominate the market. The technology was already there several years ago. Apple just want to earn more money by provide seemingly new products. For example, iPad was a revolution, by the time they have designed the iPad they have already be able to put front camera on it. They don't put it on on purpose so that there is one more selling point when they sell ipad2. That is brilliant move. So I tend to agree with Tim, it's too soon to tell. There is still possible that the Apple is designing another revolutional piece but try to hold them until the management think it all through.