5 worries fund managers have about Apple

“A team of Credit Suisse analysts led by Kulbinder Garcha spent part of the past eight weeks meeting with 150 institutional investors to talk about Apple,” Philip Elmer-DeWitt reports for Fortune.

“Apparently, they got an earful, which they summarized in a note to clients Monday as five ‘key recurring questions and concerns,” P.E.D. reports.

5 worries fund managers have about Apple:

Concern 1: Does the iPad have a demand issue?
Concern 2: Are iPhone volumes reaching saturation?
Concern 3: Is Apple too big and aren’t shares over-owned?
Concern 4: What about Steve Jobs’ health?
Concern 5: What about the cash pile?

Read more in the full article here.

MacDailyNews Take: Our answers:
1) No.
2) No.
3) No.
4) We wish good health for Mr. Jobs and we’re very confident in Apple’s upper management
5) Surely Apple has plans for that cash, fund managers. Don’t worry your pretty little heads about it.

[Thanks to MacDailyNews Reader “sleiii” and “Arline M.” for the heads up.]

38 Comments

  1. There’s this little company called Disney that had the best CEO ever at the time and everyone said that company would crumble without him. He was the vision! He was the idea man! They can’t do anything without him!

    The secret to men like Disney and Steve Jobs is they surround themselves with like-minded people and teach them how to be like them so that when they do leave, their company will continue on the same way.

    My 1-2 week shipment of my iPad 2 took 3 weeks, so demand is still huge. Every store in my city is still sold out. My friends are still buying iPhones. I’ve upgraded my iPhone 3 times and my iPad once now. It doesn’t matter if they expand customers (though they will worldwide), because Apple customers upgrade ONLY TO APPLE PRODUCTS. They don’t lose the customers they have.

    And the cash? What’s the worst they can do with the cash, give it to shareholders? They can buy any company/technology/patent they want. Fund managers are morons.

      1. Lets hope not anyway. Eisner rung a lot of money from the Disney op’s but wasn’t a good vision or product guy. He was the worst kind of CEO, lavish on himself, and cheap on everyone else.

    1. A great point you make sir. Disney and Jobs are quite comparable. How appropriate that Jobs would go on to become Disney company’s biggest shareholder!

    2. “Apple customers upgrade ONLY TO APPLE PRODUCTS”

      So true. Once you go Mac, you never look back. NB, though, that there are still isolated islands of ‘enterprise’ uselessness (unfortunately still prevalent in the health industry in this country) which, amazingly and idiotically, still stumble on while barely supported on windoze stilts.

      1. “So true. Once you go Mac, you never look back.”

        As I like to put it, “Once you bite, you’re bitten.”

        (That should be a company tag-line.)

    3. “The secret to men like Disney and Steve Jobs is they surround themselves with like-minded people and teach them how to be like them …”

      There are a couple of SJ’s attributes that can’t be copied:

      1) Audaciously successful negotiating prowess.
      2) Inspirational ability, based on his unique RDF-contagion.

    1. WOW… so spot on. 🙂 Its like if its not a Walmart model, then they just do not know how to handle it. And any company should change its business model so they do not have to spend any extra energy thinking.

      Just a thought,
      en

  2. “Concern 5: What about the cash pile?”

    I am sure that Apple will be able to do something brilliant with all that money, just like they have in the past. Unlike the analysts, who would most likely eat the bills if they were placed next to the paste.

  3. What’s with this roller coaster ride of Apple’s stock recently? It seems like it’s been seesawing between $330 and $350 since forever. What gives? These seem like huge swings to me. Where’s the approach to $450 everyone’s talking about?

    1. This is normal for aapl. At some point there will be a big push up. Aapl goes up big, goes down a bit from profit taking, bounces around it’s new baseline for awhile before going up again.
      All manipulated by the brokers.

    1. Skyrocket? AAPL has dropped steadily since early February despite all the great news. When it hit 363 i predicted here that it was headed for $300, not the $1,000 so popular here. I am still long on AAPL but as long as Steve is not at the helm most investors will remain wary. MDN can cheerlead all they want bu AAPL is Steve. Period.

  4. What could Apple do with all that money?

    Well, they could borrow 40 billion then go buy 51% of Microsoft. Only then would Steve Jobs allow himself to pass on into the afterlife.

    Hey, it was just a thought! Don’t throw rocks at me!

  5. PED has to realize the rat-bastards are punishing apple because of your expose. The MM has to show consistency now. They know the yoyo motion of GM he stock snow under scrutiny. Since their prime directive was to take this down to a precise point for their masters to make a predetermined amount on their short positions. They are rushing to reach this price point, after which they will swing the price upwards. As this trend of falling PPS co it yes, watch the GS analyst spout positive dribble while the MM (also from GS) continues to bring the stock Dow. This way, GS will say that they have consistently been positive on the stock and proves the independence of their analyst and MM worlds. Pure BS of course, but in our incorruptible rule of law environment that our venerable Feds operate, this is just business as usual. Better yet just the cost of doing business, since worst case scenario is that the SEC will come to terms with these saints and collect a fine which will be a pittance to the amount of money that the trading desks have made.

    Read Taibbi’s latest in the rolling stones magazine. Despite thesenate’srecommendation that GS be prosecuted, nothing will happen.

  6. 5 worries Apple trackers have about fund managers:

    Concern 1: Do fund managers have an Attention Deficit Disorder issue?
    Concern 2: Are price manipulation shenanigans reaching saturation?
    Concern 3: Is [name of major financial company] too big and aren’t shares over-concentrated?
    Concern 4: What about over-fed sedentary fund managers’ health?
    Concern 5: What about the cash piles under fund managers’ mattresses?

  7. Here’s why the stock is dropping:

    The only reason to buy AAPL is if the price will rise. Operation as usual means that what we expect to happen will happen, so all that success is built into the price and the price won’t rise.

    All this talk about P/E and earnings and blah blah blah, is worthless except to define a range of 25% or so in which the stock will drift.

    Since there’s no dividend, at times like this when there’s nothing emotional, nothing new, nothing unexpected to push the stock higher, it drifts downward.

    Why? Because that’s the only way to make money on AAPL: Sell when it’s boring; Buy when it’s exciting. BTW, “exciting” is blow-your-mind products and services that will make even your grandpa consider buying, not awesome sales growth, which all expect and which isn’t that new or exciting.

    If there were a dividend owning AAPL would be worthwhile in and of itself. Since it’s not, owning AAPL is worthwhile only when people are excited about it.

    But take heart. Soon we’ll have exciting announcements (WWDC ’11) and more exciting inferences and suggestions and the stock will rise 75-100 points in four months.

    Keep an eye out for the mounting excitement and get in on the upswing. But wait until it actually begins, because this baby will drift even lower short-term.

  8. Concern 1: Does the iPad have a demand issue?
    Yes, too much demand, not enough supply. Terrible problem for a company to face…
    Concern 2: Are iPhone volumes reaching saturation?
    Premature – Apple is still expanding into China and other markets. Plus, as long as people like the new models there will be a strong annual upgrade cycle for the iPhone.
    Concern 3: Is Apple too big and aren’t shares over-owned
    So now Apple is “too big?” Not sure what over-owned means. There are only so many shares of AAPL and the majority are in the hands of institutional investors.
    Concern 4: What about Steve Jobs’ health?
    What about the economy? Oil prices? Unemployment? European debt crisis? Political unrest in a number of countries? AS MDN stated, Apple has a strong management team.
    Concern 5: What about the cash pile?
    So it isn’t earning top dollar relative to other investments. It is far better than *not* having a big cash pile, and Apple has no long term debt! Consider it to be a strategic cash reserve that offers buying and investment opportunities in troubled times as well as good times. For instance, Apple seems to have a strong component supply despite the tsunami in Japan. If Apple distributes the cash as a dividend, then it results in taxation. Apple is a *growth* company, albeit a very large one.

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