Look, folks like Fudho and sandeep and others play this game every quarter, this game of raising expectations. It is a fool's game, and there are Apple bulls who play it as well.
I expect earnings of a bit over $14 a share on iPhone sales of less than 50 million and iPad sales of a bit over 20 million. Gross margins should be somewhere between 38 and 39%.
Will Apple make those numbers? I think there are better than even odds that they will, but the fundamental story is the same whether they do or not. When Apple has a trailing twelve month P/E of 12.5 or less, buy it. If you want to trade, sell it when the ttm P/E is 14 or higher. Rinse and repeat. Do not buy close-in options. This is not difficult.
If you are gaming Apple's earnings, then it probably makes a difference to you. If, OTOH, you are not gaming Apple's earnings then, frankly, you can ignore it.
I know this, as of the end of 2012 our IRA accounts where up about 1,000% since Jan 1, 2009 - mostly on the strength of Apple and investments in AAPL LEAPS. I also know that the majority of that money is now in a portfolio of more than 20 dividend growth stocks, with an overall yield of 4.6% and a history of providing dividend increases that are higher than inflation. You see, I am rapidly approaching the retire to a tropical environment and collect dividends stage of life :)
There will still be room in what I call our personal growth and income fund for some AAPL LEAPS and some shares. The shares go on the dividend side of the portfolio and the LEAPS on the growth side. I have my Jan 2014 and Jan 2015 LEAPS bought.
So I appreciate Apple providing the resources that will provide a nice supplement to our pensions over the year. I am not, as some have written, looking for the next Apple. For those of you who are looking, you have my best wishes. |
