>AAPL can be very predictable.<
Eric, we luv ya man and thanks for the creating/linking the chart but the wording of your conclusion is ... uhh ... strained (ambiguous).
Alternates:
"AAPL is predictable."
OK, straightforward. Make an investment and hold on.
"AAPL is very predictable."
Meaning that future events/stock prices that will befall AAPL are very clear to *you* (Mama, load up the truck with February $25 calls, and pack our bags for the Caymans!!)
or are *simply* clear to many people ("In its latest report Fidelity's Magellan Fund has listed AAPL as its top holding ... ")
"AAPL can be predictable."
Blatantly oxymoronic.
"AAPL can be very predictable."
Doh!!
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I interpret the chart/events as follows:
The previous spikes were news/event driven -- after which, in the absence of follow through, the stock price dropped. Hindsight dictated the wisdom of selling into the spike.
But AAPL has transitioned from a "value" stock into a "story" stock (Biotechs are my favorite examples.) Story stocks jump up on good news but fall back/languish in the absence of developments.
Jobs, to his credit, seems to realize this and has/is parsed out the goods news on a timely basis -- at least until AAPL can transition itself into an "earnings" stock.
CFO Anderson, at the last conference call, painted the most conservative picture of AAPL's earnings/finances. In effect laying the groundwork for future "predictable" earnings -- taking pains to minimize expectations.
Finally, it's not *predictability* for which investors pay a premium but the *illusion of predictability*. Coca Cola is the example of this -- they will always find ways to make analysts look good.
My conclusion, based on your chart, is that AAPL *was* a company without credibility that shorts did not fear. "Selling into the spike" was the correct strategy.
But AAPL is in the process of changing the Darwinian (death spiral) paradigm that many analysts still subscribe to by "morphing" its technologies to survive and flourish in a Wintel world.
Looking at the positive stock price followup to this quarters earnings suggest AAPL gainingg credibility as an earnings stock. So "selling into the spike" may *not* be the correct strategy form here on in.
It's also a "bears game" -- inappropriate to someone fundamentally bullish on the company.
Don't outsmart yourself. :1
soup [aka the Semantic (Symantec?) Cop] |
