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Apple poised to become world's first trillion dollar company by 2014
Piper Jaffray analyst Gene Munster raised his estimates for Apple share prices this morning, with a new 12-month price target of US$910 per share. Not long after that point, Munster expects the price of AAPL to go beyond the thousand dollar mark, which would translate to a market capitalization of over one trillion dollars. That's $1,000,000,000,000, folks. No other company has ever reached a market cap in that range. Munster bases his bullish forecast on continued strong sales of the iPhone. He believes, based on current data, that 70 percent of all owners of two-year-old iPhones will upgrade to a newer model of the iPhone, accounting for 33 percent of all sales in a given quarter through 2015. Munster's not the only Wall Street analyst looking at those lofty figures. Brian White of Topeka Capital Markets said yesterday that he believes Apple shares will reach $1,001 a share, based largely on his thought that Apple will enter the television market sometime in the next year. That market makes up a $100 billion opportunity for the company.
Daily Update for March 19, 2012
It's the TUAW Daily Update, your source for Apple news in a convenient audio format. You'll get all the top Apple stories of the day in three to five minutes for a quick review of what's happening in the Apple world. You can listen to today's Apple stories by clicking the inline player (requires Flash) or the non-Flash link below. To subscribe to the podcast for daily listening through iTunes, click here. No Flash? Click here to listen. Subscribe via RSS
AAPL closes over $600 for the first time: We respond with poetry
For the first time in history, or at least since Apple went public on December 12, 1980, AAPL has closed at over US$600 per share. The stock closed on the NASDAQ exchange at $601.10, up a whopping $15.53 (or 2.65 percent) on the day. AAPL opened at about $598 due to off-hours trading in the wake of yesterday's announcement of the Apple cash call. This morning's news disclosing that dividends would be paid to shareholders obviously resonated with the markets. To celebrate, our very own Erica Sadun got all poetic and sent these sweet words of happiness throughout our virtual newsroom: "If in Apple's stock you invest, today it has achieved the best. Gone up past six hundred, in case you had wond'dred, now you can retire and rest." Or how about this "News in Haikus"? "AAPL Dividend. Stock is up past six hundred. Good investment, no?" And this final piece of limerick doggerel: "Up $15.53 on the day, investors all saying HOORAY! Most in after hours last night, still to their delight, dividends are soon on their way." Think you can do better with the poetry? Let's see your attempts in the comments.
Apple plans to initiate dividend and share repurchase program
A statement by Apple this morning has confirmed the company will start paying dividends to investors and buy back US $10 billion in shares starting this year. Subject to declaration by the Board of Directors, the Company plans to initiate a quarterly dividend of $2.65 per share sometime in the fourth quarter of its fiscal 2012, which begins on July 1, 2012. Additionally, the Company's Board of Directors has authorized a $10 billion share repurchase program commencing in the Company's fiscal 2013, which begins on September 30, 2012. Additional details will be available during Apple's conference call which begins Monday at 6:00 a.m. PDT. You can listen to the call on Apple's website, or follow along with our liveblog kicking off shortly.
Daily Update for February 13, 2012
It's the TUAW Daily Update, your source for Apple news in a convenient audio format. You'll get all the top Apple stories of the day in three to five minutes for a quick review of what's happening in the Apple world. You can listen to today's Apple stories by clicking the inline player (requires Flash) or the non-Flash link below. To subscribe to the podcast for daily listening through iTunes, click here. No Flash? Click here to listen.
AAPL hits $500
Shares in Apple have reached a new all-time high today, pausing briefly at the stratospheric height of $503.83 this morning before dropping slightly below that level. It wasn't all that long ago -- three months -- that Apple shares were quavering around $360. There's more to come. Seeking Alpha's Robert Paul Leitao has now set a 2012 price target of $790 per share for AAPL. Leitao does note that if Apple takes the step of beginning to pay quarterly dividends, that could affect the share price in a very positive way: "Extraordinary events such as a resumption of a regular quarterly dividend or a share split are also not factored into this share price forecast and may accelerate the pace at which the shares approach this $790 price target." [Stock charts via NASDAQ.com]
Daily Update for February 9, 2012
It's the TUAW Daily Update, your source for Apple news in a convenient audio format. You'll get all the top Apple stories of the day in three to five minutes for a quick review of what's happening in the Apple world. You can listen to today's Apple stories by clicking the inline player (requires Flash) or the non-Flash link below. To subscribe to the podcast for daily listening through iTunes, click here. No Flash? Click here to listen.
Apple stock gains nearly $100 since Steve's passing
Apple 2.0 editor Philip Elmer-DeWitt is back today with another fascinating Apple statistic: "[Apple] has gained nearly one Facebook in value since Steve Jobs died." Elmer-DeWitt remarks that the share price of AAPL on October 4, 2011, the day before Jobs passed away, was US$372.50 and that the market capitalization of the company was about $347 billion. Now, just four short months later, the stock price is (as of this morning) $472.66, over $100 greater than before Jobs died. That puts the market capitalization of Apple, Inc. at about $440 billion -- over $90 billion of growth in just four months. Those numbers are staggering. $90 billion is about nine-tenths of the value that Facebook has been given in advance of its upcoming IPO. Elmer-DeWitt notes that it's hard to argue that Apple is overvalued. He quotes Erik Savitz of Forbes noting that even after backing out Apple's $100 billion cash horde, valuation of AAPL is just 2.6 times revenues and 10 times earnings. The Apple 2.0 post ends on a rather dour note, with Elmer-DeWitt noting that "two prominent Apple bulls" agree that Apple's shares are ready for a sell-off.
Investors eyeing Tim Cook's management of Apple's cash horde
Every three months Apple announces its quarterly earnings, and we see the company's huge pile of cash grow to increasingly awe-inspiring heights. Like clockwork, a day or two after the earnings announcement comes calls for Apple to give some of that money back to its shareholders in the form of dividends. Reuters claims that these calls for dividends are getting louder, and some investors are getting restless. Apple's US$98 billion cash horde is so big that it represents a value of $104 per share, a big slice of the current $444 per share stock value. Several Wall Street analysts are convinced that Apple will pay a dividend to investors in 2012, but they say that every year. Apple has not paid dividends on its stock since 1995, and Apple CFO Peter Oppenheimer has stated that the money isn't burning a hole in Apple's pockets. CEO Tim Cook and Oppenheimer revealed that Apple is actively looking at what to do with its money, but neither of the executives would commit to a firm comment on the company's intentions. One major stumbling block is that most of Apple's cash is tied up overseas -- $64 billion of its $98 billion. Repatriating that money to the US would subject it to a 35 percent tax, skimming over $22 billion off the top... something that Apple has lobbied against. Within the next few days I predict we'll see another wave of posts predicting huge company acquisitions -- finish your drink if you see "Apple could buy Facebook" in your RSS reader before the end of the week. That's also an unlikely scenario; Apple has a history of buying smaller companies that aren't already household names, and it usually only drops a few billion dollars in the process. Much like the iPad cannibalizing the Mac, I suspect Apple's executives see the company's cash stockpile as a nice problem to have. It affords the company a great deal of flexibility; Apple could make zero dollars in revenue for the next seven straight years and still be able to sustain its current operating expenses. With dividends and major acquisitions likely out of the picture, there's no way of knowing what Apple intends to do with its money... though I have my own loony ideas about that.
Amateurs beat pros at predicting Apple's Q1 performance
When it comes to predicting Apple's financial performance, you may want to ask bloggers, day traders, and amateur analysts instead of listening to Wall Street analysts. As cited in a post by Apple 2.0's Philip Elmer-DeWitt, the real analysts blew it big time predicting Apple's financial numbers for the first quarter of 2012. As noted by Elmer-DeWitt, "although even the most bullish independents were surprised by the strength of Apple's Q1 2012 results, at least they were in the ball park." In a ranking of accuracy, the independent analysts took the top fifteen positions, while the Wall Street gurus brought up the bottom of the chart. That's not to say that Wall Street's finest aren't capable of making at least a few good estimates. Asymco's Horace Dediu and Sterne Agee's Shaw Wu were both accurate on predicting the Mac sales numbers. TUAW's favorite analyst, Piper Jaffray's Gene Munster, was right on target with his estimate of iPod sales. When it came to iPads and iPhones, though, the independents beat the street. Gabriel Dubois was close with his estimates of iPhone sales and gross margin, while Gregg Thurman "missed narrowly on iPads." Elmer-DeWitt notes that "The company that Steve Jobs built is still that rare beast in American business: A $400 billion giant that acts -- and grows -- like a start-up." That ability to be agile, design and sell innovative products, and make huge margins on sales of those products make it difficult for even the most highly-trained Wall Street analysts to make accurate predictions.
Apple announces Q1 2012 earnings, sells a record-breaking 37 million iPhones
Apple released its earnings statement and announced yet another banner quarter. Apple knocked it out of the park, with record quarterly revenue of US$46.33 billion compared to $27.64 billion in the year-ago quarter. As predicted, iPhone sales were through the roof with 37.04 million units sold. This is up from the 17.07 million the company sold last quarter and up 128 percent from the 16.24 million it sold this quarter in 2010. iPad sales were also up to another record-breaking level. The company sold 15.43 million iPads units, which is up from the 11.12 million iPads the company sold in Q4 2011. It's also an 111 percent increase from the year-ago quarter when it sold 7.33 million units. Mac sales remained strong. Apple sold 5.2 million Macs, which is up slightly from the 4.89 million it sold during the previous quarter. iPod sales continue their downward decline from 19.45 million in Q1 2011 to 15.4 million iPods this quarter, a 21 percent year over year decline. Apple will livestream its conference call later today, and we'll be liveblogging it as it happens.
AAPL breaks all-time high ... again
I don't know if anyone else noticed, but shares in Apple, Inc. have reached another all-time high price. Just minutes ago, AAPL was at US$428.40, although as usual the stock price will probably wobble all over the place before the close. Why is AAPL doing so well? There is mucho speculation that the company will announce record earnings ... again ... on Tuesday, there's a lot of interest in tomorrow's education / textbook announcement, and many related companies (suppliers and mobile carriers are the prime examples) are reporting increased earnings based on sales of Apple products. At press time, Apple's market capitalization was at $397.97 billion. Yowza.
Apple closed at a record high on Friday; hits all-time intraday high today
On Friday, January 6, Apple stock quietly achieved a milestone by closing at an all-time record high price of US$422.40 per share. Even better, the stock has just passed an all-time intraday high (it was at $427.75 earlier this morning). That puts the company's market capitalization tantalizingly near $400 billion. That's not the highest price the stock has ever reached. On October 17th, Apple's stock reached an intraday high of $426.70, but closed lower. During the months of October and November the share prices tumbled, along with the rest of the market, but AAPL has seen a remarkable recovery in the last month. Much of this boom in the share price appears to be a run-up to Apple's quarterly earnings announcement on January 24, according to Fortune's Philip Elmer-DeWitt. That announcement, which covers the all-important Christmas quarter, is expected to be chock-full of good news from Cupertino. [Chart generated by AOL DailyFinance.com]
Daily Update for January 3, 2012
It's the TUAW Daily Update, your source for Apple news in a convenient audio format. You'll get all the top Apple stories of the day in three to five minutes for a quick review of what's happening in the Apple world. You can listen to today's Apple stories by clicking the inline player (requires Flash) or the non-Flash link below. To subscribe to the podcast for daily listening through iTunes, click here. No Flash? Click here to listen.
Bob Iger picks up $55,000 in stock for joining Apple's Board
We mentioned earlier this week that Disney CEO Bob Iger was invited to join up to Apple's Board of Directors, and Fortune reports that as part of his deal, Iger got 142 restricted shares of AAPL, totalling a nice bonus of over $55,000 at current market value. Nice work, if you can get it! We joke -- Iger has been a key player at Disney for a while, overseeing both the recent purchase of Marvel Entertainment, as well as the acquisition of Pixar, which of course was headed up by none other than Steve Jobs. $55k is nothing for Iger, though -- last year, he picked up more than $29 million in compensation from Disney, according to SEC filings. And Iger has one other thing going for him that he and I share: He's a Bachelor of Science alumni from the Roy H. Park School of Communications at Ithaca College in upstate New York. Go Bombers!
Apple's earnings "miss" more an issue with overzealous analysts
Apple reported its quarterly earnings earlier this week, and the results were lower than many Wall Street watchers expected (even though Apple beat its own revenue guidance by more than 12%). This miss was widely reported and Apple's stock took a hit -- AAPL dropped from above 420 before the announcement to under 400 on Thursday afternoon. But whose fault is this negative perception? Is it Apple's failure to perform this past quarter, or analysts' overenthusiastic predictions that led to this situation? According to Fortune contributor Andy Zaky, this foible is only a minor blip created by analysts whose predictions were off the chart. Zaky points out that Apple, in the past, has reported revenue that was about 12-18% above guidance. Analysts used this historical information and issued a consensus estimate that was 5-10% above guidance. That's how it worked. Analysts would predict on the lower side, Apple would earn on the higher side and life was good. This past quarter, though, analyst estimates had crept up to 18.8% ahead of guidance, while Apple's reported earnings were 13% above the company's guidance. Though Apple's earnings fell within the normal 12 to 18% over guidance, analysts got ahead of themselves and overestimated Apple's performance. And it's their own fault, says Zaky. Apple repeatedly warned analysts this was going to be a transitional quarter, but analysts failed to listen. [Via The Loop]
Apple reports Q4 2011 earnings
After the market close today, Apple reported financial results for its fiscal fourth quarter, surpassing its revenue guidance handily but falling well below the expectations of the usually spot-on amateur analyst crowd. The company reported revenues of $28.27 billion, up almost $7 billion from the year-ago quarter. Earnings per share came in at $7.05. Gross margin was 40.3 percent, versus 36.9 percent in the year-ago quarter. The results represent the best-ever September quarter for Apple. Mac sales in the quarter were 4.89 million; iPads were 11.12 million and iPhones came in at 17.07 million, even noting that the iPhone 4S did not arrive in time to impact the Q4 results. For the full fiscal year 2011, revenues were $108B and earnings were $26B. Apple's stock closed today at $422.24, and is currently down to $404.50 in after-hours trading. We'll be live at 5pm ET with our liveblog commentary on the Apple earnings call. Full press release below. Show full PR text Apple Reports Fourth Quarter Results All-Time Record Mac and iPad Sales Highest September Quarter Revenue and Earnings Ever CUPERTINO, Calif.--(BUSINESS WIRE)--Apple® today announced financial results for its fiscal 2011 fourth quarter ended September 24, 2011. The Company posted quarterly revenue of $28.27 billion and quarterly net profit of $6.62 billion, or $7.05 per diluted share. These results compare to revenue of $20.34 billion and net quarterly profit of $4.31 billion, or $4.64 per diluted share, in the year-ago quarter. Gross margin was 40.3 percent compared to 36.9 percent in the year-ago quarter. International sales accounted for 63 percent of the quarter's revenue. The Company sold 17.07 million iPhones in the quarter, representing 21 percent unit growth over the year-ago quarter. Apple sold 11.12 million iPads during the quarter, a 166 percent unit increase over the year-ago quarter. The Company sold 4.89 million Macs during the quarter, a 26 percent unit increase over the year-ago quarter. Apple sold 6.62 million iPods, a 27 percent unit decline from the year-ago quarter. "We are thrilled with the very strong finish of an outstanding fiscal 2011, growing annual revenue to $108 billion and growing earnings to $26 billion," said Tim Cook, Apple's CEO. "Customer response to iPhone 4S has been fantastic, we have strong momentum going into the holiday season, and we remain really enthusiastic about our product pipeline." "We are extremely pleased with our record September quarter revenue and earnings and with cash generation of $5.4 billion during the quarter," said Peter Oppenheimer, Apple's CFO. "Looking ahead to the first fiscal quarter of 2012, which will span 14 weeks rather than 13, we expect revenue of about $37 billion and we expect diluted earnings per share of about $9.30." Apple will provide live streaming of its Q4 2011 financial results conference call beginning at 2:00 p.m. PDT on October 18, 2011 at www.apple.com/quicktime/qtv/earningsq411. This webcast will also be available for replay for approximately two weeks thereafter. This press release contains forward-looking statements including without limitation those about the Company's estimated revenue and earnings per share. These statements involve risks and uncertainties, and actual results may differ. Risks and uncertainties include without limitation the effect of competitive and economic factors, and the Company's reaction to those factors, on consumer and business buying decisions with respect to the Company's products; continued competitive pressures in the marketplace; the ability of the Company to deliver to the marketplace and stimulate customer demand for new programs, products, and technological innovations on a timely basis; the effect that product introductions and transitions, changes in product pricing or mix, and/or increases in component costs could have on the Company's gross margin; the inventory risk associated with the Company's need to order or commit to order product components in advance of customer orders; the continued availability on acceptable terms, or at all, of certain components and services essential to the Company's business currently obtained by the Company from sole or limited sources; the effect that the Company's dependency on manufacturing and logistics services provided by third parties may have on the quality, quantity or cost of products manufactured or services rendered; risks associated with the Company's international operations; the Company's reliance on third-party intellectual property and digital content; the potential impact of a finding that the Company has infringed on the intellectual property rights of others; the Company's dependency on the performance of distributors, carriers and other resellers of the Company's products; the effect that product and service quality problems could have on the Company's sales and operating profits; the continued service and availability of key executives and employees; war, terrorism, public health issues, natural disasters, and other circumstances that could disrupt supply, delivery, or demand of products; and unfavorable results of other legal proceedings. More information on potential factors that could affect the Company's financial results is included from time to time in the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of the Company's public reports filed with the SEC, including the Company's Form 10-K for the fiscal year ended September 25, 2010, its Forms 10-Q for the quarters ended December 25, 2010; March 26, 2011; and June 25, 2011; and its Form 10-K for the fiscal year ended September 24, 2011 to be filed with the SEC. The Company assumes no obligation to update any forward-looking statements or information, which speak as of their respective dates. Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App Store, and has recently introduced iPad 2 which is defining the future of mobile media and computing devices.
Reminder: Apple fourth quarter FY11 earnings announcement today
After the market close today (4pm Eastern), Apple will announce quarterly earnings for its 2011 fiscal fourth quarter. Apple's fiscal year ended on September 25 (roughly aligned with the US federal government's fiscal year), which means that the all-important upcoming holiday quarter is actually Apple's Q1 of 2012. As usual, the earnings guidance ($25 billion in revenue, $5.50 earnings per share) provided by Apple at the start of the quarter is likely to be almost comically conservative; Philip Elmer-DeWitt at Apple 2.0 provides an overview of the results forecasts, and comes up with an estimated "whisper number" built atop the educated guesses of the non-pro analysts with the most consistent track record. The results, by their lights, should be somewhere north of $30B in revenue and $8 EPS. The psychological milestones of a non-holiday quarter with four million Macs and ten million iPads sold are almost certainly going to be passed as well. At about 5pm ET, the company's executives will hop on their quarterly analyst call to discuss the results. We'll be here for live commentary and consideration, so set a reminder below and join us! Note: TUAW does not provide financial or investment advice.
AAPL takes a hit despite iPhone 4S news (Updated)
Apple's share price has dropped dramatically after today's announcement of the iPhone 4S. At 3:07 PM EDT, AAPL was down over $16 per share to $358.51, although it could recover before today's market close. While this doesn't look good for Wall Street's enthusiasm for the new device, the stock drop is actually quite normal for the day of an Apple announcement. We've seen similar results after announcements of most new Apple devices, with the stock usually recovering or rising the next day. The stock price for new US iPhone carrier Sprint doesn't seem to be reacting much in one way or another to the announcement. At press time, the company's stock was selling at $2.68 a share, down $0.06 for the day. Shares in Verizon and AT&T were relatively steady as well. Of course, most of the responsibility for the lackluster stock price for Apple could be tied to the world economic news today. Fed Chairman Ben Bernanke's comment that "The economic recovery is close to faltering" has resulted in an overall decline on the markets, with the Dow-Jones Industrial Average down 162, S&P 500 down 12, and NASDAQ down 17 at press time. Update: AAPL closed today at $372.50, only down $2.10 (-0.56 percent). The DJIA, NASDAQ, and S&P 500 all finished the day up. It's amazing what can happen with the market in only an hour... Turns out that the "hit" was more of a "hiccup."
Pre-event AAPL trading bucks trend
Andy Zaty of the Bullish Cross blog has done some interesting analysis on the AAPL stock price around Apple's keynote events, and he found that for next week's event, the pattern seems to have fallen apart. During the past four iPhone releases, Apple's stock price has risen in the rumor-filled run up to the unveiling, as investors are taken in by the excitement and interest surrounding the possibility of a new iPhone. Then, once the event happens, the stock usually falls off a bit (though obviously in general, it's risen over time). This time, however, the stock price has fallen, almost 17% from where it was at a few weeks ago. Why is that? Hard to say -- it could be that most Apple events are pretty mysterious, but on this one, rumors about the iPhone 4S or the iPhone 5 have been flying around for a while already. It's also true, according to the research, that Apple's events don't have as big an effect on the stock price as they used to. As big as AAPL has gotten, more and more investors are somewhat savvy about the whole process, knowing that Apple's fate doesn't really depend on what it announces at any big event. Still, it'll be interesting to see what happens with the stock price, both over the next week in the lead up and after the event. I don't actually give out financial advice (and this post shouldn't be considered as such, obviously), but I suspect we won't see too big a jump or fall over this keynote -- all indications are that besides a new iPhone announcement, this event will likely be business as usual.
