You obv did the right thing by recommending diversification. Your post is very results oriented. Without your advice that single stock portfolios are too risky, they may have invested that money in Enron.

"Your post is very results oriented"

To put it another way: "hindsight is 20/20". The only reason one would have had to invest in AAPL in the late 90s / early 2000s was the fact that Jobs had previously proven he was a genius (first he proved this at AAPL in the 80s, then with Pixar in the 90s) - certainly their operating results at the time were nothing to crow about. The bottom line is that the future is never clear in the tech industry. Nobody knows today whether AAPL will be able to keep their current momentum going for the next 10-20 years, or whether a new crop of competition will wipe them out. AAPL could easily be today what MSFT was in 1999 - a company peaking and entering a period of slowing growth. The tech industry can obviously turn on a dime - nobody heard of Facebook 8 years ago, now it's supposedly worth $50,000,000,000.

That is why Buffett never invests in tech companies - there is no long-term earnings visibility with them. He gave a speech in around 1997 when he said that he thought MSFT had a "helluva position" in their market (around this time the Justice Dept was suing them for being a monopoly, if you recall), but he really couldn't see how their business would evolve over time. Thus, he lacked the certainty he needed in his own mind to commit capital to them. Basically, in Buffett's view tech companies have no competitive "moat" - today's AAPL could tomorrow's MSFT (or worse yet, tomorrow's AOL).

Nice poem.

The family had no rationale other than "Our friends made a bundle on KMart or some other BS stock, so we figured we could pick one at random and hit it big too". It just so happened that the random stock they settled on ended up getting smacked in the face with the deck.


Guarantee that if we were married, her parents would mention it ****ing constantly.

From that interview - in a question on portables,

"Wait till we do it, the power of a Macintosh in something the size of a book!"

So awesome he was envisioning this stuff 20+ years ago, and knowing it was feasible.

The picture on Zerohedge (from TMZ) is a fake. It was doctored. Not saying that Jobs is in good health - obviously he's not, or he wouldn't have resigned as CEO - but the pic suggested he is near death, which I don't think is necessarily the case (I hope it's not).

Can you explain why it's priced for perfection? At what price do you think AAPL would be "reasonably priced?" Thanks.

I expect that losing Steve Jobs will adversely affect Apple in the long term in a significant way.

Do I believe that Apple will continue to innovate? yes.
Do I believe that they will do so at the pace they did in the last 10 years. Absolutely not.
Do I believe that Apple has created a framework that allows them to continue to succeed? yes.

Yes Apple will continue to do well. However, I believe that when you lose a founder who has been shown himself to be a visionary and a great business person, and leader, you always lose something significant that is very difficult to quantify. If you look at companies historically this has ALMOST always been the case. Microsoft, Walmart, Disney, Hershey, etc. It's not that companies will necessarily flounder, but it's hard to replace these once in a generation talents.

Taylor, I think it is significant that Steve Jobs is only stepping down as CEO and did not actually pass away.

Apple isn't 'priced for perfection'. I bought it at ~355 where it was underpriced with a flat net growth rate (10% growth 10% dcf) by a decent chunk. It's def not badly priced now.

MSFT is pretty terrible at innovation. They were really good at taking other peoples innovations and either copying them or finding a way to make money with them. Perhaps you could call them innovative businessmen, but their technology has always been far from innovative.

Your average business...
Does not require leading edge innovation...
And, certainly, does not require "coolness"...
And "software politics" has NO PLACE.

Business requires stable, supported, ubiquitous software...
And ubiquitous, interchangeable hardware...
That everyone is familiar with...
That can be fixed anywhere...
At a reasonable price...

And that's the platform you build on.

As a software engineer running a trading business...
I wouldn't touch Apple or Linux or anything exotic...
(Until you get into enterprise territory)...
Your infrastructure will cost 200-300% more in long run.

You will be held hostage by geeks extorting $100/hour.

On the other hand...
Everyone running a business should study this...
Steve Jobs 10 Commandments:

http://www.thedailybeast.com/newswee...mandments.html

Will picking up AAPL in the $315-$320 range ever happen again?

Yes.


But only after you decipher this poem...

i dont think so. iPHone and iPad make up 65% of apples revenues. now iphone will be available on sprint, possbily 6 million more sold. maybe ipad is next on sprint? Either way, estimates are too low.

http://investing.businessweek.com/re...ticker=AAPL:US

So no then?

First day of class for my return to college (mostly for shiz and gigglez).

I couldn't help but notice it's MacBooks everywhere, some even running Windows. No way around it, MacBooks have become fashion icons.

Then iPads... pre-meds and pharmacy majors got them instead of hauling reference books. Language majors got them for dictionaries. Engineering majors got them for drawings. Medical/nursing students got them because they are actually required.

A lot of textbooks are actually sold in electronics format for significantly cheaper too. (up front anyway... for obvious reasons no resale value here)

Granted, technically they could use Android (and probably others) tablets but clearly iPads dominate now.

Then there are people who just use them because they can.

Quite amazing actually.

with all fads, they come and go. Apple has the benefit that they actually produce excellent products (albeit, incredibly expensive). People are incredibly fickle, so it will be interesting to see how things evolve over the next few years.

Apple also is in a good position today in that since they have a smaller percent of the overall OS market, they are rarely a target for malware/viruses. As this trend reverses (and as more enterprises pick up Mac because they incorrectly believe it is more secure ("security through obscurity")) it will be interesting to see if Apple can keep up. IMO they have done an iffy job in the recent months responding to security issues. See PWN2OWN results (like this http://www.computerworld.com/s/artic...WN2OWN_wins_5k) for more information about how "secure" Mac OS really is.

MacBooks (like most fashion icons) could be fads... iPads burrowing themselves into actual industries changing common practices are not fads.

I'm pretty anti-Mac out of necessity (lack of support by softwares I use) but I (just) bought a MacBook Air to run Windows because it's the only "ultrabook" (Intel's term) on the market now. Their ability to respond to, anticipate and even create consumer demand is a major core competency that goes well beyond just their current product lines.

How much of that core competency was tied to Steve Jobs remains to be seen.

RIP Steve

Curious to know short-term opinions on AAPL

I really like AAPL, own a bunch of it and will probably add more soon

AAPL makes me nervous. Two words: Sony Walkman. I don't think AAPL is overvalued by any means, but SNE is down about 85% from its peak.

I feel like AAPL is different than some of the earlier tech companies for a few reasons. They have developed multiple products and have no fear of focusing on future products while slowly phasing out the ipod that has become cannibalized by the iphone.

The ipad and iphone are revolutionizing the market and integrating themselves into many different industries. The amount and quality of the apps are well above android or any other competitor. They make seamless integration between all of their products very easy with the cloud. The iphone captures a huge percentage of overall smartphone profits while having a relatively small market share. It also generates money from music, video and now application sales.

Apple shares have actually been one of the best performers of late, gaining 340% over the last five years. But what's grown far faster? Apple's earnings, which have jumped over tenfold since 2006. Put those two together, and you get a remarkable figure: Apple now trades at the lowest valuation it's seen in over 10 years. Plus they have no debt and a bunch of cash on their balance sheet. I think that Apple has set themselves up for success for the next 5-10 years that can be put on auto-pilot and still be wildly successful.

I'd love to hear reasons why I'm wrong, what does everyone else think?

Their future growth might not be as impressive as their past growth. It might actually suck. Hard to tell the future. They are not a bubbly stock, so I wouldn't think you were gambling for buying.

The two scenarios aren't at all comparable. Sony's peak valuation was massively inflated by the .com bubble while their revenue and profits were already tanking in the two years before the stock market crash. Plus, the company is full of idiots.

AAPL is selling luxury goods in a semi-recession and somehow making money hand over fist.