Q1 results are in, and still they disappoint
There's some quite impressive numbers there.

Mark

The expectations are always ridiculous. These are perfectly acceptable figures. Though I think that the problem is that Apple is held by more hedge-funds than any other stock, and they want spectacular returns. The fact that they are now paying dividends should hold up stock prices to some extent.

If you're half sensible you completely ignore whatever 'wall street analysts' say, the way you would the honking of a flight of geese as they pass overhead flying south.

The correct comparisons are how the numbers look compared to what Apple said the numbers were going to be and how they compare to the equivalent numbers this time last year. By those measures, the numbers are slightly below forecast but only be a few percent. Probably within the margin for error in a depressed economy. There's some sense Apple are beginning to 'plateau' but some people will use these numbers - compared to the predictions of analysts who had no more knowledge of what they'd be than the guy who drove the bus they rode to work this morning - and proclaim that Apple are finished. As they do every damn quarter, regardless of the actual numbers published.

Jon

Apple are doomed

Totally. That $137 Billion will not last them long. Maybe they should sell up and give the money to the shareholders? /Michael Dell.

Apple's shares are down in after-close trading apparently. Only three times in stock market history has any company made more profit in a single quarter than Apple just announced. And the share price went down.

The best quote is 'Apple’s market value has fallen by the combined market value of two Nokias plus two RIMs '.

How many Dells?

That's because the price of a share includes expectations of growth. If growth slows, investors' expectation of future earnings growth diminishes and the value of the share goes down. That's how stock prices have always worked.

Yes they seem to have forgotten about growth of very large companies. It becomes much hard for a company the size of Apple to keep growing at 30% a year. Its current PE ratio of 11 is actually low and could be a little higher with its current growth. Though if its growth trend has ended, which I doubt, then its PE is fine for a steady dividend paying stock.

I wouldn't presume to know exactly why that ratio has fallen so far, but it indicates a certain longer term gloom about Apple's prospects.

Perhaps there is a perception that Apple is close to saturating its main markets, and has little chance of repeating its iPhone trick in the TV space or web services or whatever to open up broad new ones in the rich world. I hear they risk becoming an also ran in the emerging markets unless they come out with cheaper and lower margin products than is their usual preference.

If that's how the analysts see it, or something along those lines, I would expect to see a few more quarters of record numbers, but little share price growth. Then one day somebody will demand a share buy back scheme.

The ratio is low for a company with growing sales and profits. The iPhone is probably nearing saturation in the west, but the rest of the world shows potential. Smart phones in general are now the majority in Europe and the US, so growth will probably tail off from now on. The iPad has a good few more years as the top seller in the market segment. I think that everyone is wanting to see what is next before buying again. The price is probably good depending on the dividend yield.


Sent from my iPad using Tapatalk.

Yeah, I'm aware of that, amazingly. The point is the expectation is completely out of whack with reality. It's the fourth (apparently could be fifth, but the point is more or less the same) biggest quarter of any company ever and it's Apple's biggest quarter ever therefore by definition, yet to stock market analysts who actually had no good information to base their projection on at all, it's considered 'disappointing'. Who actually is making the mistake here?

The stock market is a broken system. It depends apparently not on the performance of the companies whose stocks are floated, but on the whims of people who make decisions based on partial information and their own hunches, yet who bear almost none of the consequences of their actions and, recent history suggests, little responsibility for them.

I know how it works and as a somewhat rational human being I stare agog at the stupidity of it.

You are. You said you understood, but you think the value of the stock is defined by the quarter they are reporting on, which indicates that you do not. Their share price soared when they beat expectations and thus fueled speculation of an extraordinary growth curve. Now their curve is heading back to normal, and they have slightly failed to meet expectations, that indicates that the price was a bit high.

Buying a share is an investment. The guy selling it to you is the one getting paid for the last quarter's performance, the guy doing the buying is anticipating future earnings. If he plans to hold the share for 2 years and then sell, it means he is expecting 9 more of these record quarters. If that expectation looks certain, the price goes up, if the numbers indicate a challenge, it goes down.

I was going to write exactly the same thing. The share fell from $700 to $500 and it has nothing to do with the current (past) quarter. This is about LONG-term expectations, not the past performance.
And also about the share manipulation (from them invest. banks in New York) as Jon and Amnesia are trying to persuade us.

When the first iPhones came about people seemed to be on a phone a year. Now that I can hardly find a 12 month contract, most being 24 month contracts, people will be holding onto their hardware for twice as long.
I don't think iPads have reached this just yet, but they will.