Apple Reports Earnings today and I am putting my predictions here. As usual I am confident on Apple earnings this quarter as this is going to be the first quarter the new Ipad is sold. This will be an Ipad Quarter!

Due to the street low expectations I believe AAPL will resume the ATH by ER after the market close. I was wrong previously, predicted it will hit 640 after last ER but the macroeconomic factor pull the stock down. I am going to gamble 10% of my investment in some short term options as I am predicting a huge jump in the stock after closing. I know yesterday was a good chance to enter but I miss it.

Analyst consensus EPS is 10.35

Here are my numbers.

4 Million units of Macs
4.2 Million units Ipods
32 Million units of Iphones
20 Million units of Ipads

Total Revenue $ 41.48 Billion
45.5% Gross margin which will give us gross profit of 18.87 Billion
28.37% net margin which gives us a net profit of 11.76Billion

The EPS will be $12.43

Note that I am predicting a more than 20% higher EPS than the Analyst consensus. If this is accurate there will be a huge jump in the stock.

Time to get some options and let the show begins.

A huge miss in my AAPL model but after digesting the news for a day i don't think this is the end of the world. Trailing twelve months EPS has increased from 41 to 42 as the latest quarter replace a weaker quarter a year ago. and the PE is further compressed making the stock more appealing.

Now back to the data

Actual data
4 million macs
7 million ipod(still holding up well)
26 million iphone
17 million ipad

Total revenue 37.2Billion
net profit 8.8 Bilion
EPS of 10.35


i believe the big miss was the iPhone numbers, everyone expect a weaker iPhone sales but didn't predict at such a low number. According to the conference call, it is due to the reseller building enough inventory and anticipating the iPhone 5 hence cutting down orders. I thought this factor would kick in next quarter so expect a worse quarter 4 since that will be the last iPhone 4s quarter. which also means we will have a monster 2013 Q1 earnings.

Another factor highlighted was the strong dollar and the lower ASP of the previous model bringing the net margin down.

After the latest earnings i believe AAPL management is thinking of pushing out the iPhone 5 asap cos it seems the customers will not wait for a iPhone 5 eternally and will go for other options. iPad mini and a new iMac lineup seems to have a sep/oct launch from various sources. Ipanel/iTV is also a possible launch by 2013.

Taking into consideration of the products in the pipeline, i believe 700-750 by year end is still possible as 2013 Q1 will be the most anticipated earnings in aapl history. The anticipation of a blowout earnings, the dividends and the share buy back will send the shares up.

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Added on July 25, 2012, 8:32 pmyou should look at the relative performance of other share. How did samsung performed in korea SE from April - July?
how about your portfolio from April - july? and your much loved LVS? Still holding up good?

If you look at the 3 months graph, AAPL is the only stock holding to the same price 3 months ago despite the macroeconomic factor. Samsung and LVS has both gone down substantially.

that is why i try to keep away these debates apart from posting my predictions. until today you still do not understand relative performance and relative value.

This post has been edited by pinkdevil88: Jul 25 2012, 08:32 PM

You are hopeless. Someone please explain to this guy. This is going to be my last reply until next quarter.

I said based on my model(i made the prediction before the earnings report), i predicted a blowout earnings hence i am gambling 10% of my portfolio. Note i use the word gambling as it might go up or down which i am not certain.

and you compare aapl to samsung, so i said relatively(performance), aapl is holding up well. what has gambling got to do with relative performance?? Who is making no sense here??

and now after LVS release their latest report you said you cut loss, surprise eh? The last time I challenge you, you mention that you short the stock before the stock fall. wonderful isn't it? I made my position and prediction known before the report. and you are just opposite, thats the difference. Forumers can judge.

And last, you don't put money in your mouth, keep on bs about how bad aapl is, why not short the stock long term? Think its going to run down to 400 - 500 level? put words into action else stop whining. words are cheap.

Can't help people who speak without backing up with facts, and he does not seem to understand the whole subject matter. At the same time claiming to spoonfeed me while all he do is just to post a link of AAPL on Reuters.

Let us look at some facts surrounding Apple vs Samsung.

1. Apple produced only one handphone - the iPhone. Samsung produced multiples handphones but the only comparable handset to iPhone is the Galaxy S3 and yet, Galaxy S3 should be compared to the upcoming Iphone 5, not the current iphone 4S

Samsung shipped 50m of smartphones compare to 26m of iPhone last quarter(both Q2 based on calendar, not FY)

Out of the 50m smartphone Samsung shipped, only slightly over 10m was S3 units.

If smartphones were the most profitable products, then Samsung will be making more profits than Apple, is this true?

Samsung record a profit of $ 5.9 Billion, Apple quarterly profit is at $8.8 Billion

Now the big question is, why is Apple making more profit when they are selling less smartphones than Samsung? The most profitable product for Samsung is the S3, the other phones at lower price point are less profitable. While Samsung is gaining market share, they are not making the most profit. Because they are not selling the most profitable products. Apple strategy to focus only on one profitable product allow them to capitalised on the mass production and bring their cost down, hence their huge net profit margin at 24%.

Another thing to take note that is that we are now comparing the sales of iphone 4s with a new product from Galaxy S3. When iphone 5 is launch next month expect a record earnings from Apple in Q4(FY Q1 2013).

Something worth mentioning is that Apple has yet to reach an agreement with China Mobile(A deal with china mobile will come with iphone 5 launching). China mobile accounts for more than 2/3 of the mobile subscriber in China and does not currently offer apple products.

http://www.thenewstribe.com/2012/07/30/sam...s/#.UBhnYalRrZs

http://www.apple.com/pr/library/2012/07/24...er-Results.html

http://www.economist.com/node/21559624

2. Samsung has been gaining market share at the expense of Apple

IDC figures show that Apple market share has been down 1.9% compare to a year earlier(do not forget this is the weakest apple quarter)

— Samsung Electronics Co., 50.2 million units, 32.6 percent share (17 percent a year earlier)

— Apple Inc., 26 million units, 16.9 percent share (18.8 percent a year earlier)

It is clear that Samsung has eaten into the market share of nokia, HTC and other manufacturer but not at Apple expense. Not to forget, most of the 50m handsets Samsung sold are the cheaper handsets with lesser specifications, hence giving them less profits.

http://www.washingtonpost.com/business/tec...ZBLX_story.html

3. The Tablets

Though not as profitable as the smartphones, the tablet represent the future of personal computing. More and more consumer will opt for a tablet compare to a laptop. Imagine the day when all universities students attend lectures with a tablet. Textbooks being replaced by ebooks.

Apple sold 17m iPad last quarter which is a record sales in history. Thanks to the new ipad.

Apple tops the tablet category with 68.3% market share, Galaxy tab is no where to be seen. Surprisingly, the closest competitors for ipad are the Kindle Fire and Nook tablet which offer a smaller screen size at a cheaper price point.

With apple offering ipad mini, I would foresee they would kill off the competition coming from these small tablets. However Microsoft and Google is joining the game soon with the surface tablet and the Nexus 7.

http://www.pcworld.com/article/259864/appl...s_incoming.html

4. IOS Vs Android

Apple is the only company in the world that produces it owns hardware and software. This allows them to releases their new products together with a new operating system. For example iphone 5 and IOS 6, the new macs and Mac OS X Mountain Lion. So you can get the latest devices running on the latest OS at the same time.

Look at Nokia, after a considerably successful Lumia launch, microsoft announced that windows phone 7 based devices wont be upgradable to windows phone 8.

Though nothing happens on Android phone at the moment, who knows what will happen in the future? Will google limit the Android update on certain devices?

http://news.cnet.com/8301-1035_3-57458692-...indows-phone-8/

IOS is still the winner in terms of the quality and quantity of Apps. The best apps will get themselves on IOS first then Android.


5. The Ecosystem

Apple has a complete ecosystem. With icloud, all your documents, webpage, messages, contacts are pushed into different devices that you own - Ipad, iphone and macs. This will create a halo effects on Apple products. Making consumers owning multiple devices once they are into the IOS ecosystem. Not to mention the Airplay on Apple TV which will soon render Optical drives outdated and drive cable TV out of the living room.

What ecosystem does Samsung offer?

Samsung phone could be challenged by a Chinese manufacturer who produces a cheaper hardware running on Android(since Android is open source). Google even allowed Amazon to run a modified version of Android on their Kindle Fire. Android users can switch around easily from one manufacturer to another manufacturer.

A Chinese manufacturer will never be able to copy the software and ecosystem from Apple.

6. 750 - 800 price target. AAPL is currently trading at a low multiple of 14 times earnings and a forward PE of less than 12. You will never find another growth company trading at such a low multiple where the PEG ratio is at 0.61

If someone is willing to pay 21 times of earnings for LVS at current levels, at the same time claiming AAPL is expensive, so be it.

Whether AAPL will reach the 800 price target is just a matter of time. AAPL will make it to 800 eventually and the 2013 Q1 earnings is key.

PE is less than 70. Check your info.

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Added on August 3, 2012, 9:20 pmI hope you read the company financials. Good Luck to you.

This post has been edited by pinkdevil88: Aug 3 2012, 09:20 PM

THe figure is due to the different EPS figure quoted on Google finance.

Have been trying to figure out how google finance get to the EPS figure of FB 0.18 but couldn't get it. They probably got it wrong.

The problem with FB is the only Financial Statements published is their 10-Q report for the latest quarter. combined this info in their prospectus and you can try to figure out their TTM EPS

According to FB prospectus their basic EPS for FY 2011 Dec 31 is 0.49,
the 6 month ended June 30th 2011 EPS is 0.25 and
the 6 month ended June 30 2012 EPS is 0.02

Combine all these info and you can get to the latest TTM EPS 0.49+0.02-0.25 = 0.26

Yahoo finance is showing EPS ttm of 0.29 the difference might be due to rounding up and also the change in number of outstanding shares.

Using a EPS of 0.29 there is no way to get a PE above 100 even taking into the gain today.

all info can be found from

http://investor.fb.com/sec.cfm


I did notice on a few occasions that google finance and yahoo finance give different info and on my check, most of the time google finance was giving the wrong info. That is why i stop relying on google finance info, they are still in beta version.

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Added on August 4, 2012, 2:28 amArgh~ Give me a break. Looking at LNKD TTM PE is blatantly misleading. They have such a high PE because of the losses in last sept quarter. LNKD Forward PE of 86.53 tells a better story.

This post has been edited by pinkdevil88: Aug 4 2012, 02:28 AM

Look at AMZN before you laugh. Still plenty of high PE stock.

This post has been edited by pinkdevil88: Aug 4 2012, 05:10 AM

List of continents on Facebook
# Continent Users Penetration
1. Asia 232003100 6.00%
2. Europe 226941000 27.94%
3. North America 224232860 42.43%
4. South America 128611080 32.43%
5. Africa 44035100 4.72%
6. Australia and Oceania 13796760 39.81%


United states and Europe penetration are not among the highest. USA is only at slightly above 50% and Europe only at 27.94%

A lot of other countries and continents have far higher penetration rate. And do not forget China. THere will be one day when the communist government will be more liberal and open up the internet world so facebook potential is huge.

Exactly, the problem with facebook is moneytisation. and the challenge now is that most user shift to mobiles from pc to access Facebook. They do not have good apps, only slow and chunky app. and it is hard to display ads on a mobile phone. If they could not figure this out, it would be very tough for them.

In the long term(5 - 10 years horizon), i believe in facebook potential. I do not even dare to buy LEAPS, too risky and the commons is not worth to tie up my money with. So i rather stay at the sidelines and see the stock slide. I believe it could go down to the mid teens.

I have swapped 20% of my AAPL 2014 LEAPS with some near term calls. Am adamant that the iphone 5 launch will be a strong catalyst to push the share price up in the near term. Not to mention Ipad mini and also the iphone 5 contract with China Mobile. AAPL 2013 Q1 earning is going to be huge. Looks like $700 is coming sooner than I think.

This post has been edited by pinkdevil88: Aug 18 2012, 03:08 AM

www.interactivebrokers.com

Try this

Fill up all the form and you are good to go. All over the internet. Dont have to mail any hardcopy. If you cant handle filling all these forms, i suggest you not to invest in share market. Share market takes a lot of time for researching and learning. Mutual Funds would suit you better.

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Added on August 21, 2012, 4:54 pmLooks like AAPL is opening at 670 today. Am extremely glad i made the correct call to shift to shorter term calls to maximize my profit.

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Added on August 21, 2012, 4:56 pmUsually I use the mobile application on iPad. Simple and easy to execute orders. If i need to use options strategy then will need the standalone software on mac. it depends on which you are comfortable with and what you need.

This post has been edited by pinkdevil88: Aug 21 2012, 04:56 PM

use mobile phone/tablet for mobile apps, or pc for standalone software/web trader

You can either short commons, buy puts or write calls.

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Added on August 21, 2012, 11:25 pmSold all options, short terms and LEAPS. Gave back some profit but still a good return for 3 days trade. all in cash now. Need to preserve cash for the coming Q1. This is going to be a huge ER.

This post has been edited by pinkdevil88: Aug 21 2012, 11:25 PM

One of the reasons i sell was the upcoming jury verdict on the Samsung case. This pose a huge opportunity/risk as the stock will trade up/down significantly depending on the jury's verdict. I did contemplate to long a straddle position but decided to wait for the news to break out before making any move. Don't get me wrong, i am still a long term AAPL bull. in the next 2-3 years this is going to be a trillion dollar company. Now waiting for a good entry point.

I am back in AAPL 2013 Feb calls big time. That is the sweet spot as Q1 ER will be around end of Jan. Pppl will be scrambling to buy feb calls by then. Might roll my leaps to feb calls too.

AAPL getting ATH on the verdict. Lucky I got back in the calls. Up huge. Thank you Samsung!

You totally have no clue about the implications of this verdict.

1. The 1B cash compensation is one of the biggest in patent trial. What more significant is No other phone manufacture will dare to imitate apple products in future as their IP is protected.
2. Noone expected a verdict so soon, let alone such a huge one sided verdict for AAPL.
3. The judge can triple the damages amount to $3B and impose a sales ban on Samsung devices in the USA. HEaring on 20th Sept.
4. This verdict will have huge implications on all the other AAPL vs Samsung trial around the world.
5. AAPL is moving away from Samsung as a supplier. Samsung is no longer AAPL exclusive chip manufacturer since a year ago. Not to mention their panel displays.
6. To put you into perspective SAmsung has 14B in cash, Apple has over 110B in cash and Nokia market cap is 14B, RIMM market cap is 3.88 B
7. The 1B compensation represent most of Samsung mobiles phone profit from 2010-2012.

Samsung is down 7% today. I expect AAPL to hit 700 by this week. We could open at around 680 and trade up from there. This is the most anticipated Monday trading for AAPL.

If you think the implications of this verdict is tiny, why not try to write call options? Better still write weekly call options 700? I am sure you will get call away by Friday.

This post has been edited by pinkdevil88: Aug 27 2012, 12:08 PM

You are too short sighted. Not only this verdict affect Samsung and Apple. THis affect the whole mobile industry. The share price today reflect this. Google and samsung down. Microsoft, NOK , RIMM, AAPL up. Go figure out why. AAPL did not go after GOOG because GOOG did not profit directly from Android. They went for Google proxy, all the handset makers that uses Android.

I am already all in before the verdict. AAPL is highly undervalued, low PE yet the company is still growing YOY into the future. I guess this is too hard for you to comprehend. The market cap has no correlation with the share price. AAPL has less than 15% of the world mobile market share. We are heading to 700 soon. Maybe you can consider a buy after we make a 1 for 10 split at the price of $100

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Added on August 28, 2012, 12:17 amSo you expect GOOG to come out with an explanation. Yes we copied IOS? They copied IOS and gave it away free. This is violating AAPL Patents. The problem is they did not profit from this directly. Hence AAPL decision to sue their proxy. Easier to claim for damages.

Samsung also issued a statement that the consumers lose. Do you buy their argument? In fact the consumers win. More company is going to come out with new innovations and we will be spoilt by choices.

You really need to gather info for this trial before speaking. It shows how shallow your understanding is.

This post has been edited by pinkdevil88: Aug 28 2012, 12:48 AM

I'll let the share price do the talking. Thank you. Have been long since the mid 500.