“The investors who follow the ups and downs of Apple’s (AAPL) share price on The Mac Observer’s Apple Finance Board often look with a mixture of envy and dismay at the price-to-earnings ratios of Amazon (81) and Netflix (76),” Philip Elmer-DeWitt reports for Fortune.
“Apple, by comparison, seems downright cheap with a trailing P/E of 15.57,” P.E.D. reports. “Yet Amazon (AMZN) and Netflix (NFLX) are trading very close to their respective price targets as reported by Thomson Reuters. Apple by contrast, is nowhere near its consensus target of $450.”
Read more in the full article here.
Apple needs to split. Make the stock more affordable – get more small investors involved. Take the control away from the bulk houses. Time to grease the wheels!
While a split does nothing, value wise, it sure gets the little guy buying shares, which in turn, will make the price go up …..
It would take at least a 3 for 1 split to help and a 5 for 1 would be ideal and put into hands of many investors …..
Psychologically a split will dilute the institutional power grip that enables crippling mass manipulation and hurts the private investor and Apple.
Psychologically people will be able you buy bigger positions with a lower price per share.
Historically, whenever stock split they shoot up dramatically almost immediately (it’s all psychological).
Apple at this point is a victim of too much concentrated power in the hands of hedge funds and other institutions that write and enable weekly options and naked shorting and prey on fear and greed that they create. Time to take the big boys down.
… Opinions on this. Where are the more typical “investors”with their B-School theories? Not that I miss them …
A) a split would lower the entry bar for less affluent investors
B) the whole market IS down (and holding) due to the over-all economy
C) S. Job’s health is very much a concern for many potential investors
D) many of the bigger buyers understand both B and C.
Don’t worry too much, take advantage of it all, enjoy being the contrarian making the big profits when these things no longer rule the price.
Okay, I’ll bite.
(A) Nonsense. There are not enough poverty-stricken investors who can’t afford a share of AAPL at a few hundred dollars to make any difference. A split would have no effect on accessibility to “less affluent investors.” It doesn’t take affluence to buy a $335 (or $600) share.
(B) The whole market is down but not as much as AAPL.
(C) S Job’s health was well known and fully factored into the price in March when the share price hit $365.
(D) Of course. But AAPL’s share price isn’t being driven by fundamentals or value at the moment. Here’s what’s going on:
By Dec 2010, just five months after AAPL weekly options were introduced in July, 2010, the price of AAPL has traded within a 10% range, almost perfectly consistently returning to the point of “Max Pain” for options investors by the expiration date every week. The price can’t break out because the options tail is wagging the share-price dog.
Fundamental analysis should put AAPL way higher; a company growing this fast should be trading at 11x post-cash.
“The price can’t break out because the options tail is wagging the share-price dog.”
and the tail belongs to the institutionals (they are the option writers) who are killing the goose that lays the golden eggs.
A split would dilute the shares. Enough splits in a short time will usually send a stock down.
Apple has, in the past, held up well in a correction but not this time. Wait for a proper buy point, right now it is too risky.
Don’t fall in love with a stock just because you love the company.
But is it as coiled as Anthony Wiener’s wiener though?
Aaaaahhhhh !!!
It’s not that their stock is a coiled spring is that the interest in the tech sector is down across the board. It’s frickin’ June. Wait about 4 months for a pickup. Come on guys, think.
We’ve seen a lot of articles like this recently. Hopefully that will change the market opinions.
I personally think the market manipulations are keeping aapl in limbo. Hedge funds, shorts etc are all using the stock to make money.
I assume at some point the stock will come out of its doldrums. Apple have so much going for it at the moment I am very surprised it is stagnant. Companies like Amazon and Netflix have only one business line. Apple now have Macs, iPods, iPhones, iPads and iTunes all providing multi-billion dollar revenue.
I’m starting to sort of accept that Apple’s share price not going higher has something to do with the uncertainty that Mr Jobs medical leave brings to the table; regardless of whether the company will thrive with or without him, or the company’s strong financials. I don’t see any other factor negatively affecting Apple’s share price.
The moment Mr Jobs steps back in, share price will go up, no doubt.
From a simple view, the most visible difference between Apple and Amazon, Netflix is the official presence of their CEOs; yet, I think these other companies’ share price is very inflated.
You probably haven’t noticed but the only thing weaker and sickly than Apple’s share price is Steve Jobs himself. I was scared that a strong gust of wind would have blown him offstage at WWDC just like a gentle economic breeze causes Apple shares to plummet. Steve Jobs will never come back to Apple as the CEO. Steve is just a shell of his former self and hasn’t put on a pound since being on medical leave. It appears to be Steve’s last hurrah. If Apple’s share price is supported by Steve Jobs like the Earth is supported by Atlas, then both Apple and Earth will be shattered into a thousand worthless pieces.
Apple is a company that is basically destroying the rest of the computer and smartphone industry and yet the share price hinges on Steve Jobs. Wall Street has become a destroyer of sound business practices and global economies and is rampantly corrupt. Wall Street cares little about strong product lines. Good luck with your “Steve Jobs returning to Apple to boost share price” theory. Apple is being played like a yo-yo on a very short string with the string holding it up about to break at any moment.
Apple’s coiled spring? Apple’s coiled spring is about as weak as the spring you find in a ball-point pen after 10,000 presses. Looking to make money, buy Sohu, Netflix, Amazon or any other high P/E tech stock. They’ll all do much better than the obviously manipulated Apple.
Once again we hear from WiseAcre, who fancies himself an investment guru. Does it somehow prop up your inflated self-image to be a contrarian, to preach gloom and doom in an attempt to scare Apple investors, and to crow about the health of another human being potentially declining? How small of you.
Investment guru matters aside, Jobs health got worse in the last three months. He can not already hold his voice normally, it uncontrollably shakes from time to time because of extreme fatigue and weakness.
So yes, Jobs might be more far than ever from returning to Apple. There is always hope that things will go better, but this time the hope is bleak, unfortunately. But I still hope, though.
Thank you Doctor, would you like a job with the National Enquirer?
What this has to do with “Doctor” thing? I did not give any diagnoses or prognosises. Common sense, however, is enough for anyone sane to make a conclusion on the progress of Jobs’ condition: just watch his March Apple event (accessible on YouTube, besides Apple’s own site) and his latest appearances. If you ever heard how people sound not long before they die, you will understand that the progression is negative. But, as I said, there is chance for recover (even if small) and I hope it will play out. Wonders do happen sometimes.
“Anonymous Coward TrollTard Deluxe”.
(As someone regular here called you a few days ago)
Anyone following your recent postings, especially this:
“PS: Don’t forget the hot buying opportunity for the massive Apple rally come next earnings announcement. Ahem!”
…understands that you are a lonely clueless asshole that never gets wiped.
Eleanor Rigby might have been written for your likes.
I tend to coincide with some of the things you said. I had to read my post again and I think it is not flawed, however I went from rational in one paragraph to emotional in the next.
Yes, I wish Mr Jobs comes back to Apple badly (and not only because of the money or share price, but because he is as human as any one you love and I think people like him should last forever) but guess what, that is not (and should not be) the only concrete way for Apple to end/finish the uncertainty I refered to in my first paragraph. It may be a big factor of uncertainty but, the more the company finds other ways AND REASONS to assure investors, the greater the chances are for share price to move upwards.
In some instances, no amount of money will buy you health. Those who own both good health and billions are very lucky people in this world. Honestly, if I had to choose one over the other, it’s a no brainer, I’d choose billions…. Ha!! kidding.
10-to-1 split and AAPL will go through the roof. Everyone, and I mean everyone that I’ve talked to about buying Apple thinks the stock is “too expensive”. Even after explaining that it’s immaterial what the price is, they still think it’s too high. C’mon Apple, go get your scissors and start cutting up those shares.
And what are the disadvantages of a big split? Can’t think of a single one. Can you?
Re “Everyone, and I mean everyone that I’ve talked to about buying Apple thinks the stock is ‘too expensive.’”
Too expensive for what? To buy a share? Seriously? Do you think there are enough millions of investors out there who can’t afford a single share of AAPL who would be swayed by a split? Is this the high-school-student investor market or the sub-Saharan African investment market you have in mind?
A split in my opinion would not be a good idea. Sure AAPl is mostly manipulated by big time investors but they know that what they say will make the weak ones buy or sell. Drop the shares down to 50 and you will get tons of people who would obviously buy in. But of course if people are only buying because now they can afford to then they wont be buying a lot of shares to begin with. So a few million shares are bought from people with not a lot of money and chances are they aren’t even well seasoned in the stock market so knowing their investment is probably for a retirement fund or whatever they will buy or sell on a whim as soon as an analyst tells them too. That is part of the problem with a stock split. Maybe a 2-1 so it still stays up there in price but a 5-1 split would be insane. There is a reason some companies have huge share prices.. some even upwards of 100k a share.
And who’s fault is that? The investors on the stock market floor! Why after 4 years running have they not realized that Apple has the best hardware, the best software, the best service, and the best innovations that keep customers coming back and new customers joining in. Why when they set the price target, the stock goes down. Why when Apple makes record profits, the stock goes down, why when Apple announces new great products the price goes down!
once AAPL approached GOOG prices, investors can only compare it to that stock, which has done nothing for the many many many longs who bought it over $500… AAPL does need to split to burst through this psychological barrier, which runs contrary to fundamentals.
You couldnt be more right on!
This surely makes perfect sense to anyone.