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Strategies & Market Trends : Buy and Sell Signals, and Other Market Perspectives -- Ignore unavailable to you. Want to Upgrade?

To: GROUND ZERO™ who wrote (42231)	12/20/2012 3:53:45 PM
From: Keith Feral	Read Replies (2) \| Respond to of 221961

Tech stocks like Apple get into big trouble once they start accelerating price cuts. Apple cut the price of iPhone 4 and iPhone 4S by $100 this year, and just announced another $50 discount through Best Buy and Wal Mart for all Iphones. The problem with the price declines is they never go away, and I am certain the price of the iPhone will only ever get cheaper. Apple's best profit margins are behind them. Next year, they will be slashing the price of the iPhone 5 after they launch their next iPhone too. Plus, they will have to shave another $100 off the price of the iPhone 4S. They need 20% revenue growth just to keep EPS flat from last year according to their own guidance. I don't see Apple doing anything that special if EPS are going to be flat for this quarter vs last year. At this point, revenue growth is not generating EPS growth for Apple. Doesn't make them a bad company, just ordinary. With a $500 billion market cap, they are still priced like geniuses. Longer term, the iPhone business no longer looks like much of a growth business. The best they can hope is for lower margins and higher market share til they end up looking like NOK.