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AAPL flirts with $600 today
Apple's stock soared on Wednesday and now it is poised to cross the US$600 mark. As noted by CNN Money, the stock hit $600 once and has fallen back down to $598 at the writing of this post. As The Wall Street Journal points out it took Apple 34 trading days to jump from $400 to $500 and a mere 23 days from $500 to $600. With strong iPad sales expected tomorrow, it's highly likely the price will go over $600 and stay there sometime today. This threshold will push Apple's market value even higher. It's currently sitting at the $556 billion mark which, according to a report in Wall Street Pit, is just below the 2011 GDP for Saudi Arabia. [Via CNN Money]
Apple stock soars, market value close to entire retail sector
If you haven't noticed, Apple's stock was soaring today. It closed at US$589.58, another all-time high, and is up +21.48 for the day. As financial analysts pour over these numbers, they are discovering some amazing trivia about this off-the-charts growth. Morgan Stanley's Katy Huberty may have kicked off this climb when, as Philip Elmer-DeWitt of Apple 2.0 notes, she revised her previous 12-month price target from $515 to $720 (base case) and to a mind-boggling $960 on the bullish side. Apple's stock has gone up 40 percent since last October 14 ($422) when the iPhone 4S launched. Up 68 percent this year alone. Tyler Durden of ZeroHedge points out Apple's market value is almost equal to the market value of the entire US retail sector combined. Asymco also chimed in and noted that "Apple's market value today increased by more than one Nokia, nearly three $RIMM's or a bit less than one Sony." MacDailyNews also points out that Apple's market value ($548.95 B) is now double that of Microsoft ($274.42 B). To see how far Apple has come, Apple went public on December 12, 1980 at $22.00 per share. It's lowest market value was $630.9 million (stock price of $1.375) on July 8 1982. With the new iPad launch only two days away, I have a feeling this is only the beginning of a momentous climb for Apple.
How long does it take to buy a new iPad with 50 shares of Apple stock?
The Telegraph's Conrad Quilty-Harper has an intriguing spin on Apple's soaring stock price. Instead of measuring Apple's atmospheric rise in direct dollar figures, Quilty-Harper measured it in terms of raising money to buy an Apple device. Quilty-Harper started by looking at the price of Apple's stock before and after the recent iPad launch. He then calculated how long it would take for you to recoup the purchase price of the iPad if you bought 50 shares of stock on the day before the launch. Assuming you have US$27,000 to buy 50 shares of Apple stock, his figures show that you could recoup the cost of the new iPad in two days. If you did a similar calculation for the iPhone 4S, it would take 5 days. Quilty-Harper does the same for other Apple mobile devices, including the iPad 2, the iPhone 4, the original iPad and the iPhone 3GS. Point your browser to the Telegraph's website to read the rest of his unique analysis.
JP Morgan: Apple is a sector unto itself
JP Morgan's hardware analyst Mark Moskowitz has laid bare exactly how huge Apple has become lately, calling the company an actual "sector," not just a company any more. Of course, on paper, Apple is competing with other computer and device manufacturers like Dell and Samsung, but the numbers just don't make that comparison meaningful any more, says Moskowitz. Apple's stock is by far the largest single stock in the S&P 500 index, and when you compare the company's income to other tech sectors like Pharmaceuticals and Software as a whole, Apple's take actually lines up within the top 10. I'll say that again, because it's important: Apple's income and operations actually compete with whole industries, not just the rest of the PC market. This isn't just the iPhone or the iPad being a new class of device, it's Apple as a whole company creating a tech sector of its own. That's pretty incredible, and if you haven't yet realized how big Apple has gotten in the past few years (as if the $98 billion in cash wasn't clear enough), maybe that's your wakeup call. Now, this may all seem like financial types just making much ado about numbers, but it actually holds quite a bit of meaning, both for Apple and its competitors going forward. Apple's huge growth in the past few years will have lots of consequences, both for the company and the technology industry at large, and we still haven't figured out just what a lot of those consequences will be.
Facebook files $5 billion IPO, values the company at nearly $100 billion
The rumor, speculation and awkward Winklevii jokes can end (at least for now) as Facebook has officially filed for its public offering. Underwritten by Morgan Stanley and Goldman Sachs amongst others, the internet's most popular site seeks to trade under the stock symbol "FB" when it goes public later this year. The company is seeking to raise $5 billion, according to this early filing, amounting to a lofty (and still tentative) valuation north of $50 billion. If that turns out to be accurate, though, Zuck will be one (especially) rich man: with a nearly thirty percent share in the company, his net worth would balloon to almost $30 billion. The process of going public also provides a rare glimpse into internal stats previously kept private, with documents revealing the service has 845 million active users each month -- nearly half of which log in and actuate 2.7 billion likes and comments each day. The filing also sheds light on the company's balance sheet, with revenues of $777 million, $1.97 billion and $3.71 billion in 2009, 2010 and 2011, respectively. All told, it logged profits of $229 million and $606 million in those years -- earnings that were bested by the $1 billion it netted in 2011. The majority of its revenue comes from advertising, yet a sizable chunk (12 percent) of last year's figure comes courtesy of Zynga. All in all, that's enabled the company to stash away nearly $4 billion in cash -- a sizable nest egg for a company only eight years old. As for Zuck, his 2011 salary of $500,000 will be cut to $1 as of January 2013, but he'll be more than comfortable, thanks to that 28.4 percent stake in the company.
THQ receives stock delisting notice
THQ's woes continue as the troubled publisher receives a delisting warning from the Nasdaq stock exchange. The company's stock has been trading below the minimum of $1 for the past 30 days.The publisher has 180 calendar days (until July 23, 2012) to make its stock regain compliance for 10 consecutive business days. If the company can't comply, well, let's just say these things don't end happy. There are examples of game companies coming back from the brink. Heck, Majesco has done it twice.THQ is hurting bad, as it works through a realignment and sets off waves of layoffs to stabilize the company. The publisher is expected to explain its current financial issues during an investor call this Thursday, February 2. THQ's stock price is trading at $0.70 as of 8AM ET today.
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.
RIM stock falls eight percent following CEO transition
We rarely meddle with stock news around these parts, but this was a pretty significant piece of meat to chew on. After Research in Motion introduced Thorsten Heins as the new CEO last night and again in a conference call this morning, the company's stock price tumbled a whopping 8.47 percent. When it comes to what kind of difference the transition will make for the struggling company, we haven't had a high amount of confidence; while we hope for the best and want to see RIM turn things around, the falling stock appears to indicate that we're not alone in expressing concerns about this morning's events. Here's some food for thought: when rumors that Samsung was interested in purchasing RIM flooded the internet, the latter company's stocks spiked by nearly ten percent.
Zynga's paid $300 per new user in the past nine months, says analyst
Zynga has been struggling with its stock price since the IPO late last year, and Sterne Agee analyst Arvind Bhatia says there are more dark days ahead. When you compare Zynga's $120 million marketing budget to its recent rise in only 400,000 new players (about $300 a person), the numbers don't look good: "We know that, on average, these people are spending about $150 or so," says Bhatia, which suggests that Zynga is spending about $300 for every $150 in profit. "That math won't work for very long," obviously.Zynga's spending is indicative of a few trends in social gaming. First, the company has discovered it's very hard to earn new players. Many of Zynga's games are similar, and without really experimenting, it's going to be hard to generate uniques. Second, Zynga's earnings are based on "whales": A small percentage of players who spend big. You need to find a lot of unique free-to-play players to land a few whales, and Bhatia doesn't see Zynga doing that lately.So what's the solution? "Zynga will have to find their next FarmVille," says Bhatia. Until the company finds another phenomenally popular hit and the surge in new players that comes along with it (which is incredibly tough to do), Bhatia expects to see even more problems with Zynga and its stock.
The Force is with SWTOR: EA stock bounces back, budget revealed
It seems like everyone is obsessed with the exact amount of money EA spent creating its most expensive title ever, but the Los Angeles Times may have a final number to end the discussion: Apparently, Star Wars: The Old Republic cost $200 million. Other interesting details from the Times' investigation into what it calls a "galactic gamble" include the fact that it was made by 800 people on four continents with an additional 1,000 voice actors (doing three languages) handling 4,000 characters. The project was such a massive undertaking that BioWare co-founder Greg Zeschuk likened it to "teaching elephants to do ballet." One of the interesting details of this behind-the-scenes expose is that BioWare said that certain movies and TV miniseries influenced class storylines, such as Big Trouble in Little China for the Smuggler and Band of Brothers for the Trooper. There's also some good news following yesterday's word of EA's stock hit. MarketWatch reports that several brokers have defended the title, resulting in a 2% bounce back in EA's stock. As part of that, a Pacific Crest analyst raised his predictions of quarter sales for SWTOR from 1.5 to 2.2 million, with 800,000 subscribers. Another analyst claims that over two million units of SWTOR have been sold since launch with an expectation that 75% to 90% of players will stay on as paid subscribers following the first free month.
Electronic Arts stock drops because of SWTOR fumbles
Electronic Arts' stock appears to be in a bit of trouble following Star Wars: The Old Republic's launch. The company's shares fell by almost 3% to $17.75 US this morning after a stock analyst working with Brean Murray Carret & Co. "cut his price target on the stock to $22 [US] from $28 [US]." In a note to his clients, analyst Todd Mitchell wrote that he felt some "creeping concerns" regarding The Old Republic's performance so far; he added that "initial sales appear to be below expectations, and casual observation of early play is causing us to rethink our churn assumptions." Now we just get to sit back with some popcorn and see whether BioWare can get its business together in time to make a recovery, so take a seat. [Thanks to Chum for the tip!]
Tesla loses two Model S executives, Elon Musk says it's no big deal
A pair of bigwigs over at electric vehicle maker Tesla have drawn their final checks, with Peter Rawlinson and Nick Sampson calling it quits. The former was the automaker's vice president and chief engineer, while the latter "supervising vehicle and chassis engineering." Ricardo Reyes, a company spokesman, emailed the following: "Having completed conceptual and design engineering work on Model S, Peter has decided to step away to tend to personal matters in the U.K." The Model S, if you'll recall, is the un-launched four-door sedan that has heaps riding on its success, so it's no big shock to hear that the outfit's stock plunged around 20 percent following Bloomberg's report. Elon Musk, Tesla's chief executive officer and biggest shareholder, stated that "the uncertainty around [the] Model S is now much diminished, as anyone who has seen the beta vehicles and toured the factory will appreciate; there is no question in my mind that we will start delivering vehicles in July, if not sooner." Musk took to Twitter to assure people that the shock reverberating from the news was "way overstated," insinuating that the company's still well in control of its destiny. Whatever the case, we'd still take a couple of those S sedans in our garage, regardless of who's heading up their deployment.
The Kodak Moment it never wanted: company reportedly prepping for Chapter 11 filing
Tough to smile in times like these, folks. Barely three years after yet another staple in the photography business filed for Chapter 11, Kodak is reportedly getting its paperwork in order to do the same. The Wall Street Journal has it that bankruptcy protection is looking all the more likely in the coming weeks, as its efforts to hawk a "trove" of digital patents proved to be in vain. As it stands, the employer of around 19,000 is currently working with lenders to secure around $1 billion in debtor-in possession financing to keep it alive during the actual bankruptcy process. Should this all pan out, its portfolio of 1,100 patents would then be re-listed via a court-supervised bankruptcy auction. Oh, and to make matters worse, it warned earlier in the week that it could be delisted from the New York Stock Exchange after Kodak shares closed at under $1 for thirty straight trading days.
Report: Rovio mulling Hong Kong IPO in 2013
Finnish school for agitated ornithological research mobile mogul Rovio may be looking to capitalize on its world-wide brand recognition and ridiculous, un-ending revenue stream by listing its stock on the Hong Kong Stock Exchange in 2013, assuming the world still exists in 2013, that is. The financial liquidity inherent in Asia's increasingly prosperous business climate makes for an excellent pro-IPO opportunity, according to Finnish outlet Tekniikka & Talous. While no official announcements have been made as of yet, an IPO in Rovio's immediate future makes sense considering that the developer is currently valued between $2.6 and $9.1 billion and recently turned down $2.25 billion from Zynga.
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!
Motorola Mobility stockholders happy with Google merger, 9 out of 10 dentists agree
The people have spoken, and they're pleased. Said people, of course, are Motorola Mobility's shareholders, who have given a seal of overwhelming approval to the company's merger with Google. The company confirmed this sentiment in a statement issued yesterday, declaring that a full 99 percent of shareholders gave a thumbs up to Big G's acquisition at a recent meeting that comprised 74 percent of all outstanding shares. It's likely that much of this optimism was fueled by a rosier Q3 earnings report (not to mention the relatively favorable conditions upon which the acquisition was determined), but Googorola isn't entirely out of the woods, as the federal government must still give the deal its final approval. Motorola Mobility says that should happen by early next year, though it acknowledges the potential for delay. Read the full statement, after the break.
Nexon's Japanese IPO aims at raising $1.3 billion
When Nexon is finally added to the Tokyo Stock Exchange in December, the company has to be planning a massive "We're in the money!" song-and-dance to celebrate. TechCrunch reports that this will be the biggest IPO in Japan in 2011, with a corporate goal of raising $1.3 billion (100 billion yen) from the listing. The Korean company recently moved its headquarters from Seoul to Tokyo, and is well-known for its popular MMOs such as MapleStory, Mabinogi, and Vindictus. Nexon has over 3,000 people in its employ across the world, and previously said that it is open to purchasing more companies in Japan after the IPO. The company commented on its post-IPO strategy in a brief statement: "As we pursue our strategic objectives, we regularly review our options for accelerating our growth. We have made no decisions or announcements about any specific financing or other plans and cannot comment on rumors." The IPO will be handled by Nomura Securities, Morgan Stanley, and Goldman Sachs. Nexon is hoping that the move will raise its market cap to $9 billion, which will make it the biggest online gaming company listed on the Tokyo Stock Exchange. The company is currently worth $7.7 billion.
HP 'officially' out of TouchPads, Best Buy can still help you out
Looks like the tablet that wouldn't die is finally dead -- well, kind of sort, for now. HP sent out a note to let the world know that it's "officially out of stock" of the zombie TouchPad. It's not all bad news, however -- apparently you can still pick one up at Best Buy, so long as you buy an HP computer at the same time. Mourn another quasi-death for the webOS slate with Boyz II Men after the break.[Thanks to everyone who sent this in]
Trion Worlds may go public following RIFT's success
Want to own a piece of your favorite MMO studio? If you're a fan of Trion Worlds, then you may yet get your chance. The company announced that it is mulling over a decision to put the company on the market with an IPO. CEO Lars Buttler says that it's just a matter of time at this point: "As we build scale and become more profitable, [an IPO] is clearly on our horizon at some point. We've had a lot of bankers coming to us recently. We keep all of our options open at this point. We definitely have enough substance and enough skill to be a public company at the right time." Trion has been doing well for itself lately, as it's doubled its staff in 2011 and raised $100 million from investments since 2007. RIFT's success has helped to convince the company that an IPO is a solid move. "RIFT is vastly profitable. It is profitable every single week and every single month," Buttler said. RIFT isn't Trion's only project, as the company is working on End of Nations, Defiance, and the Red Door publishing platform.
AAPL: Analysts forecasting stratospheric stock price
Yesterday Apple (AAPL) hit an all-time intraday price of $422.86 and currently it is trading around $413. However, those prices seem cheap compared to what almost every analyst thinks AAPL will do in the next twelve months. DailyFinance has a roundup of analyst expectations for Apple's (AAPL) stock price and it appears that the sky is the limit. Forty-six analysts believe AAPL will hit a mean of $500 in the next twelve months (not much of a stretch since that's only a 20% increase) while some believe the stock could hit as much as $666 a share in the same period. Their estimates are based on many things, including AAPL's EPS (earnings per share) forecast of $27.53 for 2011, and $32.39 for 2012, compared to $15.15 in 2010. It also doesn't hurt that, as I tweeted a few days ago, this is the second year in the row in which the iPad has no viable competition for the holidays. That means that the iPad will dominate holiday tablet sales again. And this holiday quarter is a much more important quarter to do it in than last year as tablets are hitting the mainstream now and are sure to be popular gifts not just among the tech crowd, but among mom and pop consumers as well. That's to say nothing of the iPhone 5 and rumored, cheaper iPhone 4S. Those three devices, plus the wild popularity of Apple's MacBook Airs will be why Apple owns this holiday season and why I believe the stock is going to hit $500 by January 1st. I know, I know, what does a blogger know about the stock market? But matter of fact, in 2009 when AAPL was trading at under $200 a share I wrote "I believe that AAPL could hit $300 by the end of 2010 and $400 the year later." I was blasted in the comments for writing that but, as it turns out, I was absolutely right. So this time I'm going to stick with my $500 January 1st target and I think the analysts at the higher end of the spectrum are dead right. AAPL could be trading well into the $600s be the end of next year. The sky's the limit. Disclaimer: This author owns shares in AAPL. Opinions in this post are those of the author only and should not be considered as investment advice.
