From top to bottom, Apple plunged 5.5% last week


  1. Jonny Tilney said:

    Oh right-oh. How far back does it have to go? $10?!?

    October 6, 2018
  2. From Robert Paul Leitao, whose post got lost in WordPress:

    Let’s keep a few things in perspective:

    The 12-month rise in Apple’s share price has been remarkable. However, as of Friday’s closing price Apple is trading at about 16.40 times the Street’s lowly consensus eps estimate for FY2019 of $13.71. The consensus eps estimate will rise over the next few months as Apple releases September quarter results, December quarter guidance and the domestic economy is primed for a strong holiday season.

    In my view, the shares are trading at a bargain price on a long-term basis with yet another dividend increase expected in April and possibly yet another increase in the massive share repurchase program.

    Apple has the most advanced and most comprehensive products and services line-up in the company’s history heading into record quarterly revenue, record quarterly net income and record quarterly earnings per share in the December quarter. Although Street estimates remain conservative, Apple is forecast to deliver record revenue, record net income and record earnings per share for the fiscal year that began last Sunday.

    The only times a non-leveraged long-term investor needs to be concerned about the share price is on the days they buy shares and on the days they sell shares. In my view, no matter the recent 12-month performance for the share price, Apple remains attractively priced on a long-term basis for acquisition.

    Just a reminder the December quarter each year represents about one-third of Apple’s revenue and this December quarter is the last quarter with a prior-year compare under the old tax rates. I expect the Street’s current $13.71 consensus eps estimate to be viewed only in the proverbial rear-view mirror in less than three month’s time. The December quarter will set the pace for revenue and eps growth for the fiscal year.

    Apple is in the midst of the largest share repurchase program in corporate history. While we would all like to see new all-time highs each day, any sell-off in the share price at this time creates a buying opportunity for long-term investors and a buying opportunity for Apple.

    October 7, 2018

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