“If a business fails to take care of its customers, its customers will go elsewhere. Every businessman knows this to be true, and for those who are prudently observing the trend in one of our giants, forward risks become a reality,” Thomas H. Kee Jr., president and CEO of Stock Traders Daily writes for MarketWatch. “In the case of Apple, this is happening in front of our eyes, and the risks are therefore very high. Apple has stopped serving their customers well, and unless they start to serve their customers better the company will begin to lose more market share and revenue and earnings projections will come down aggressively.”
“Most people think Apple’s customers are the end user, but because Apple relies so heavily on third-party resellers like Verizon and Sprint, both of which are feeling margin contraction and negative effects on earnings because of the extremely high cost of iPhones, the real customers are third-party resellers, and Apple is not treating them right,” Kee writes. “As long as margins and earnings are negatively affected by sales of Apple’s products, those resellers will look for alternatives and eventually they will find them. Nothing could be clearer.”
“We all know that Apple’s products were revolutionary, but they are not nearly as elite as they were… Now, nothing in Apple’s arsenal is compelling enough to command multiples as high as recent growth rates. To any doubters, look at the past growth rates versus current market multiples; Wall Street already sees this coming,” Kee writes. “It [sic] you own AAPL and you are expecting the company to grow like it has in the past, you are sorely mistaken. Apple is not what it was… Apple is not respecting customer needs, and until this changes Apple is a sell.”
Read more in the full article here.
MacDailyNews Take: Kee offers zero evidence that Verizon and Sprint feel that “Apple is not treating them right.”
The tale will be told when Apple reports Q112 earnings on January 24th. And, at every significant milestone that AAPL hits, our iCal icons will bounce in our Docks and Kee will be fed and re-fed his crow with relish. We’re nothing if not experts at tenaciously doling out recurring ignominy.
Welcome to hell, our newest Laura Goldman, welcome to hell.
[Thanks to MacDailyNews Reader “Brian Allen” for the heads up.]
Laura Goldman: Owning Apple stock is a spiritual experience devoid of logic – February 06, 2008
Investment advisor Laura Goldman puts ‘sell’ on Apple – May 21, 2007