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Technology Stocks : Apple Inc. -- Ignore unavailable to you. Want to Upgrade?

To: slacker711 who wrote (142386)	10/8/2012 5:21:33 PM
From: Brian Sullivan	Read Replies (2) \| Respond to of 213172

AAPL was the biggest decliner today of all 40 stocks that I own. AAPL - 2.2% $638.17 -$14.42 Is it due to the FoxConn strike or was there a down grade today that I missed.

To: slacker711 who wrote (142386)	10/8/2012 5:39:22 PM
From: Keith Feral	Read Replies (4) \| Respond to of 213172

I've been out since 667 after buying it near $578 after their lousy earnings report last quarter. I thought it was a great sale based on the fact the $100 point rally provided almost 10 years worth of dividends in less than 2 months. When I got back in Apple at $578, it still had a much higher yield than the 10 year at the time around 1.75% and the yield on the 10 year was 1.5% when I bought it. Apple is in a different yield environment than where they were a couple months ago. The stock would have to decline to $350 to match MSFT's 3% yield, or they would have to increase the cash dividend from $10.60 to $21.20 to have a 3% yield. Right now, Apple looks very weak out there with a 1.66% yield. The cash flow on the 10 year bond is higher than Apple right now at 1.75%. Apple would have to get back to $600 to match the yield on government bonds right now around 1.75%. It's incredible that Apple can decline from $700 with a 1.5% yield all the way back to $600 with a 1.75% yield. That's an extremely high risk, low return trade off to generate 25 bp's in incremental yield. The sooner the stock gets down to a decent valuation, the sooner I can buy it again. Same with QCOM, which seems to have almost the same low yield as Apple right now. Both were down around 2% on the day with 1.6% yields starting out the day. Low yields suck when a momentum stock turns down - it can take weeks before their is any kind of yield improvement. Apple doesn't seem all that much different to me today than QCOM at the end of 2000 when it had a $1000 price tag. Better to find real yield alternatives. No longer matter what you made on Apple, it's what you don't give back.