Apple’s results aren’t the total disaster implied by the market meltdown

“At first glance, Apple disappointed Wall Street with its fiscal first-quarter results published late Wednesday. This was the first full quarter in which the iPhone 5 was available. In particular, at 47.8 million, the number of iPhones the company sold came in at the low end of analysts’ expectations. iPad unit sales of 22.9 million were also short of some forecasts,” Rolfe Winkler reports for The Wall Street Journal. “As a result, Apple shares dived nearly 10% after the market closed, leaving the company with a market capitalization of about $437 billion. Backing out Apple’s cash pile of $137 billion, that implies a valuation of less than eight times 2013 expected earnings.”

Winkler reports, “But were the results really that bad? At 13 weeks, this year’s fiscal first quarter was a week shorter than last year’s, making comparisons difficult. IPhone unit sales were up 29% in the quarter versus the prior year’s 14-week quarter, while iPad sales were up 48%. Unit sales per day, however, showed bigger jumps: 39% for the iPhone and 60% for iPads. Overall, revenue was up 18%, but on a fairer per-day basis, it jumped 27%. Meanwhile, despite the shorter quarter, earnings per share of $13.81 were actually better than the consensus estimate of $13.48… Clearly, Apple didn’t provide the kind of blowout quarter many have grown accustomed to. But the results aren’t the total disaster implied by the market meltdown.”

Read more in the full article here.

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Jim Cramer: ‘Without Steve Jobs, Apple is just another stock, it’s not magical anymore’ – January 23, 2013
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32 Comments

  1. There are many on Wall Street who are expert at perverting the common good for their own personal gain. This is one of those moments. When the big hedge funds pulled out in November and the WSJ article a couple of weeks ago hit, the options markets went crazy and still are. I have written to Apple, told them their stock is as much a product as iPhones and iPads and they now need to invent a firewall to protect individual shareholders from speculative creeps in New York. Personally, I’d love it if they de-listed and sold stock through an App that they run themselves. Screw the markets.

  2. Apple has the most saught after products for higher end users. They rule music and video, and users are tied into future products through vertical integration by icloud. Investment in APPLE should be a long term thing. I see another buying opportunity.

  3. The Economist reported that in a recent survey nearly every economist said it was not possible to predict share price, and roughly 60% of the general public thought it was possible. Apparently, economists know that share price isn’t tied to reality.

  4. Apple should have trading in the stock suspended in after andpre maket after earnings so there is an overnight to absorb results. Machines were controlling the trading as it would have been impossible for humans to execute the “dumpex” that was occurring during the Conf Call.

  5. “In particular, at 47.8 million, the number of iPhones the company sold. . .” This was in 13 weeks.

    This averages out to 525,275 iPhones per day, every day. That’s A LOT of stuff. Can you imagine the physical volume of material that leave the plants every day?

    I agree with Jeff – I wish my finances were as terrible as Apple’s.

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