Apple $700: Don’t get burned again

“Carl Icahn recently announced a long position in Apple (AAPL), which has now unequivocally reclaimed the title of the most valuable publicly traded company on the market,” Ashraf Eassa writes for Seeking Alpha. “Icahn’s announcement, coupled with buzz building ahead of Apple’s upcoming September 10 announcement(s), has caused the shares to rise meaningfully from their 52-week lows, closing a smidge above $500 in the most recent session. It is my view that shares have very little upside potential from current levels.”

“Apple isn’t a bad company (it’s a great one!), and I’m certainly not of the school of thought that the company ‘lacks innovation.’ The company makes solid computing devices, and provides a top notch software ecosystem,” Eassa writes. “Unfortunately, while this holds true, the trajectory of consumer-oriented computing is clear: better, faster, and cheaper.”

Read more in the full article here.

MacDailyNews Take: Eassa seems to assume that there are no new products being explored in new markets by Apple. That’s quite an assumption.

Wearable computing, television and streaming media, services, etc. are all things Tim Cook has long talked or hinted about. Never forget that even after Apple reinvented the portable media player market and reshaped the music business, the naysayers just couldn’t imagine how they’d take on the cellphone market. Then, prior to iPad, they simply couldn’t fathom why Apple wasn’t making netbooks.

As with most things, and certainly with Apple, stuck in-the-box thinking and myopic foresight will get you every time. Ignore the trees, there are huge forests out there.

13 Comments

  1. contrarian claptrap not based in reality.

    cheaper is on the way out… google said so… you can’t expect privacy with free email… everything will be monetized… with Apple you will know exactly how you are being monetized… you are paying upfront… with other cheaper business models and devices it is buyer beware with very important things, such as your personal data!

  2. Is AAPL going up or down after Sept 10. My bet is it will plunge on good news and plunge on bad news. What do you think? May make a good survey question.

  3. I don’t read Seeking Alfa articles anymore. They are written by a bunch of bloggers who think they are analysts. They offer no concrete support for any of their arguments. They always hedge their opinions so much so that it is ridiculous. Seeking Alfa would not post a comment that is/was contradictory to what was written. I wrote a comment and did no name calling, did not write anything offensive, and was not mean, except for the fact that I picked apart the writers arguments. I got an email stating blah blah blah and this is why your comment was deleted. I wrote back and said if you read my comment it did not meet any of the things they said was the reason it was band. They finally relented some 36 hours after I wrote the comment.

  4. If you’re going to play with fire, be prepared to have your fingers seared a bit. That’s what Andy Zaky told all of his fellow Apple investors before they all went down in flames. If you want to play it safe then invest in Google, Amazon, Priceline, Tesla and Netflix. Those are the safe ones to play. They’re the companies the hedge funds are all in on.

    Apple is making too much money, the growth has been too good and they’ve got far too much cash in the bank. Throw in the stock market’s highest market cap and a modest P/E and you’ve got a risky stock on your hands. It’s the likeliest stock to collapse out of all of those mentioned above. Think of it as a frail woman walking with 200 lbs. of gold compared to one walking around with almost nothing. Which one is going to collapse first? See my point? Wall Street figures the more money a company has to carry around, the higher the chance of collapsing. Therefore, Apple is doomed, so stay away.

    Anyway, Wall Street is so chock full of crooks and jackasses you never know what’s going to pour out of their vile mouths. I feel very certain that Apple will sell tens of millions of new iPhones both here and abroad. I have no idea how that will affect Apple’s share price no matter how much revenue comes in. I honestly don’t see any connection of fundamentals to how Apple is valued, so I can’t be sure of anything. I can only take my dividends and hope for the best share price the hedge funds are willing to give Apple be it $550 or $600. I’ll have to be satisfied with whatever I get whether I think its fair or not.

    This guy’s idea that smartphones are only going to get better, faster and cheaper makes sense to some degree. However, I think smartphones are already as fast as they need to be for most consumers and as new technology comes along the high-end smartphones will still cost about the same. I don’t believe smartphones will become like pocket calculators because they’re much more complicated and require support. All these pundits ever take into consideration is just the hardware and there’s far more to a rich mobile platform than hardware.

    1. LB_48, do you actually believe that Apple’s stock price is more likely to collapse than Google, Amazon, Priceline, Tesla, and Netflix? I disagree, and I have voted with my $$ by making a significant investment in AAPL (in addition to a diversified portfolio of no-load funds that include large cap, small cap, and international companies). I may be bullish on AAPL, but I am not foolish enough to bet the bank on one company.

  5. MDN’s take is off mark. Eassa is essentially correct that consumers demand electronics that are better, faster, and cheaper. What MDN fails to understand is that all these measures are RELATIVE. Apple may be the best to many users, but if the cost and service are not up to par, then a less capable device may offer better value. And as for speed … that died with Jobs. Nobody is pushing the Apple employees as urgently in the right direction anymore. It’s a fat company with too many eddy currents.

  6. What’s up recently with MDN becoming a mouthpiece for every mediocre SA article? I’m increasingly finding that msny articles selected by MDN are a waste of time for anyone savvy about Apple.

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