Well, we haven't had a recession yet. On the long term performance? I've been spot on. On short/short-medium term trends? I've been close to dead wrong. I can't pick Apple at all.

Long term, my main argument that we talked about a lot was that Microsoft was better value than Apple and had more room to run. I got laughed at for that. Result (for 5 years):



Apple has had a perfect world unfold (no recessions, competitors getting unlucky (Samsung battery fires), 2nd world continuing to grow rapidly economically, which they need just to keep their current valuation), and yet has underperformed the NASDAQ substantially on that time frame.

My second claim was that Apple profit was destined to shrink a huge amount. Apple's margins just aren't sustainable as technology changes and competitors get bolder. No one can keep pulling 40% profit out of a hardware market indefinitely, and the services business can't replace almost 40%, $300/phone pure profit. That has yet to play out. Other businesses, like Google and Microsoft, have reliable margins and huge moats. Apple has nothing except the iPhone. Apple is a luxury items bubble that grew up in the aftermath of the GFC. The world will change, perhaps triggered by another recession, and Apple has no moat, not at 40% margin, nor do they have talent or innovation.

If you want to crow about underperforming the NASDAQ, then that's your right, but all that's happened is that Apple has followed a growing economy and ultra long bull stock market higher and higher, in a way that's done worse than the rest of tech. It was a stupid buy 5 years ago compared to alternatives like Microsoft, and it's an even more stupid buy right now.

So, now you're predicting a recession and basing your Apple prediction on that? Anyone can do that.

Anyway, you have no way of knowing how Apple will fair during said recession and beyond. Maybe they underperform now but lose less then?

Dont make me go back in this thread an cherry pick all the ways you've been wrong.

Lucky for me though, Im able to weed through your good takes and bad, because I loaded up on Microsoft too around that time. Apple is still a bigger winner for me though. Cheers.

At one point you said iO7 was going to do huge damage to the brand and an enormous fail. Wrong.


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A recession is certain. They come every 10 years or so.

Apple sell luxury goods at 40% margin for which high quality cheaper versions exist. Their entire explosive growth period has been in an improving global economy.

It's ok to admit you've been wrong man. You'd be a lot better poster if you could realize it. There doesn't have to be a "but..." on everything. You make some good points about how Apple itself is basically an index fund that has benefited from amazing market conditions and now with your boy Trump there is a small chance of repatriation but let's be honest... Missing out has been awful and imagine if you were actually short during it. Price is all that matters & you still have a major catalyst at the end of this year which is then when I'd consider shorting it.

Some hilarious posts in both here and the trading thread looking back. Really nice quarter & guidance, didn't expect to see iPads break their declining sales even with the new offering. The potential for margin expansion during the next cycle probably explains a lot of the enthusiasm (higher ASPs).

Not too bad for an underperforming idiot, idiot in the new world, & moron/cuck. Heh.

Anyone who uses the word cuck is a gigantic f-ing douche.


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lol @ the crowing, guys. Even with the help of this latest bump, Apple remains the ****tiest tech stock you buy:



Congratulations on substantially underperforming the index guys, that's a tremendous achievement and you should be proud.

Meanwhile Microsoft, which I recommended over Apple in 2012/2013, is absolutely kicking its ass. Apple is just a big company caught in a tech bull and an improving economy. It's under $100 once things turn south. Like I said:
Even under perfect conditions, with everything going right especially in China, it's been the worst big tech investment you can make.

Keep underperforming the index guys, that's some noble work that you're doing.

imo.

I mean they literally did not underperform the nasdaq on any timeframe pre- and post- crisis unless you choose your starting point right around mid2012 till mid2013. FYI i doubt they'd underperform the other 2995 non-FAANG stocks over that timeperiod.

I own both MSFT and AAPL (and GOOGL, of the FAANGS) and am a happy camper in both (cost base of both are ~1.2x gross cash lol). I disagree with your 'cheaper alternative' argument but i've seen many smart people argue the same. You're obviously still in the Iphone as commodity mode while I believe that its more than that. For me, and with that I think for many, the utility we derive from an iphone is definately larger than the $1200/2yrs you pay for one. When a phone on itself is cheap, i don't give a **** if a certain chinese phone or whatever is $400 cheaper and has a better camera or what not if it's not compatible with the entire iOS universe.

Well Apple rose from a nothing company near bankruptcy to the world's premium mass market luxury phone seller in that time. Of course that wlll outperform everything. Nothing that happened prior to 2011 or so, during their rapid growth phase, when they went from zero to 200 million units/year, is relevant to today, however.

The arguments we've had here over whether it should be bought or held or sold have been over the last five years, where it's under performed badly.
I call iPhone a high quality luxury good. It's the opposite of a commodity.
Sure. it's a great product. it's why they make $35 odd billion a year in profit.

What does this have to do with the future? Remaining the #1 seller of premium luixury mass market phone and watch gadgets at 35+% margins for the next ten years is baked into the current price. Where's the upside? There isn't any.

Do you have any idea what a recession does to luxury goods with 40% margins? Luxury good makers do brilliantly in recovering economies. They get destroyed any other time. Apple have had perfect - absolutely perfect - conditions for the last 5 years, and they've under performed the index substantially. What does that tell you?

Well they outperformed again from 2014 forwards (aka when the market realised the iphone wasn't dead). Point being, saying Apple sucks because they underperformed a market that's heavily affected by 5 stocks and whose multiple expanded >80%, using one exact 6month range - that happens to give the ideal optics for your argument - as starting point is bullocks.

I think looking at iPhones (or phones in general) as a necessity (right there with food and shelter) would explain lots of our difference in views. It is true that growth is a different story but that's why they're valued at like 12x forward netcash adjusted P/E. But while they figure out what internally produced project to fund or what other growth story to buy, i'll happily collect my $8 / share in annual capital returns.

I just pressed "5 year" on the google graph. There's no exact range. They underperformed QQQ badly over the last 5 year period. That's a fact. For a stock you think is a miracle stock. Under optimal conditions for this stock. This is a horrible outcome and it makes your investment in Apple a bad one, if you made it in the last five years. It underperformed small cap. It unperformed large cap. It just downright sucked as a tech bet.

I mean, I was kind to you with my graph. Let's compare AAPL with the second, third and fourth largest tech stocks, and the tech index:



Congratulations, you picked a turd. Solid work there.

Apple was and is a horrible investment. It has no upside, It is priced for 10 year perfection + growth. Even when everything goes absolutely perfectly and then some (Samsung battery issues, anyone?) you still lose.

I don't see what you're trying to prove here. Only thing you did was confirm my point in my first post regarding over/under performance of QQQ with/without FAANG? They underperformed the 3-5 absolute winners of the last five years. Whoop tie doo, perhaps you could add Amazon, Netflix and Nvidia to that graph as well, that'll teach me.

Apple was a beautiful investment back in 2011-2012 and at january 2016 prices. I wouldn't buy at these levels and with the current revenue mix but i'll happily wait for them to further develop services or buy their growth while collecting ~12% ROC.

But yes, with the power of hindsight I should've allocated some $ to Amazon at $200. Thank you for opening my eyes. Please do tell what companies will grow 300+% over the next 5 years.

That Apple was one of the worst tech bets of the last five years since we've been discussing it.

QQQ still beats Apple handily over that time period without FAANG. It's that crappy an investment. You forget that Apple pulls QQQ down as well as the others pulling it up; Apple is the largest component of QQQ,

No, they underperformed the average of the entire QQQ, even if you take out the large winners. Which you don't get to do.

They're priced at $820 billion and bring in $50 billion/year after tax under optimal economic conditions. They have net equity of $130 billion. It'd take 14 years of pulling down 40% gross margins at massive volume just to get your money back. Just a horrible investment.

They're actually in the 65th percentile during that period equal weighted (couldn't get my hands on continuous nasdaq weight data), including FAANG and excluding dividends. Should be worse weighted with [FAANG less Apple] having a combined weight of 23% vs 8% and average weighted outperformance of 88%.

They are priced at 820bn, have 160bn (~100bn) in net cash - enough to buy a pletorum of future of tech companies, bring in 50bn in fcf each year aka direct yield of 7.5% (~7%) while they manage to keep iphone revs steady and manage to grow higher margin services and OOT at 20% or 8+bn / year. All while spending 11+ bn on R&D, roughly 70-80% of Google & Amazon (arguable the most innovative of giant's).

Cup's half full / cup's half empty.

Im up 88%, not including dividends. Cools charts and pedantic rants though.


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"This Is Embarrassing": 2 People Show Up For iPhone 8 Launch in China

HAHAHAHAHAHAHAHAHAHAHAHA

*gasps for air*


AHAHAHAHAHAHAHHAHAHAHAHAHAHAHAH

Facts are pesky things. Patting yourself on the back for badly underperforming the market is high comedy.

I think people may be reading too much into this. Apple's lines have been getting shorter mostly because Apple has made it much easier to place pre-orders and get the phone on launch day without waiting in line.

Apple phones are still in demand by Chinese. Apple is losing market share mostly because Apple is cornered into the super premium/luxury segment and it has by and large failed to capture anything in the mid range, which is growing faster, in China. The problem is exacerbated by Chinese government interference with demands on carriers to cut subsidies on new phones.

But Chinese consumers still want Apple phones. If you have Chinese friends or just camp out at Apple stores in any major city for a day or two, you'd see tons of Chinese people buying iPhones in bulk to take home just to save a couple hundred bucks. The stuff is definitely still in demand, it's just not showing up in lines.

China is a difficult market right now with the platform 'moat' being superfluous because of Tencent/WeChat. If those pictures tell part of the story it doesn't bode well. :P The 8/X cannibalization is gonna screw up quite some numbers/data that were previously a good indicator of its success.

Remarkable strong quarter. Services runrate revs of some $35bn growing 20%+ annually. What would that be worth? Facebook has similar numbers so $500bn seems fair? (kiddin)

TS's first post is March 17 2013. So his graphs are all nonsense #alternativefacts. He is obviously wrong and has some weird issue with rewriting history to show he isn't.

I wonder if he has come around to the fact that iOS basically has a stranglehold on performance and has had it for several years. (The great irony of all TS posts are how little he knows about the underlying tech he is allegedly valuing.)

All the services are hardware-linked so I'd say it's proper (though unusual) to view it as higher ASPs. These aren't like regular services where you simply add consumers for zero outlay on their part, without adding hardware, which allows the kind of huge multiple growth that Google has had.

They're making what, $55 billion a year in profit selling an overpriced luxury product with increasingly viable competitors. All of their growth has been in a robustly improving 9 year economic recovery, which is a huge tailwind to luxury goods with viable competitors.

Taking out cash you're paying $700 billion for the privilege of owning that. Pretty awful value proposition if you were to look at it as a business buy.