2 years agoMy take: That was quick.
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Bottom line, COVID-19 is terrible for anyone involved, but not so bad for the stock price of AAPL.
The Market now understands that this is a $400 stock on sale for under $325. A bargain to hard to resist.
Over the last six months, all dips in AAPL have been sort. Each low is higher than the last, validating your thesis that investors see the bargain.
It may take a decade. Tim Cook becomes the next paragon in business schools.
My take: I see a yellow light; not a green light at this juncture.
It may be judicious for Tim C to come forth with revised guidance (as soon as he has numbers) commensurate with the level of transparency he exhibits in these matters. Tim placed analysts on notice, but each analyst has specific numbers cemented in “his-her” minds. Analysts are like herds of cattle. If they hear something different then what they are expecting, they “bolt.” If Tim C comes forth with numbers in some range analysts are not expecting, then analysts may overreact negatively.
“It may be judicious for Tim C to come forth with revised guidance…”
I can’t agree. Please remember what happened a year ago. When things looked to be seriously understated, they put a freeze on buybacks, for the simple reason that they had material information that nobody else had. Then, in an abundance of caution, they held off purchasing shares until the earnings report at the end of January last year. That’s a month and a half without buybacks tempering the selloff.
That’s different than this time, when they’ve already warned that they are likely to miss their guidance to the downside. They are not required to give any more information than that, unless there’s a serious understatement (or overstatement!) of guidance. If things are markedly worse (or better) than they thought, then my bet is that they’d once again hold off purchasing shares until after earnings at the end of April.
Some of you may like the idea of an unsupported AAPL, because it would likely drive the price down. Don’t count me in your court.
The 10-K or 10-Q gives some dates, and I remember digging them out for Q1 & Q2 fy ‘19 at the time. No buybacks past about halfway thru December, then starting up after earnings in late January is my recollection.
I just hope that whatever revised guidance he issues he does it after the markets Close this Friday, and before the markets Opens on Monday.
Frankly, I think the market is getting ahead of itself. The impact of Coronavirus is still being evaluated. It’s notable only Apple has opined on the impact of coronavirus. There will be others.
80,000 Americans died of the flu in the winter of 2017. An unusually bad flu season that year.
That’s more than the number killed in traffic Accidents, gun violence, or opioid overdoses.
As of Feb 14th 2020, Johns Hopkins University has tracked 1,384 deaths caused by the Covid-19.. It has been confirmed in over 25 countries/territories outside of mainland China, totaling 585 cases.
The population of China is over 1.3 billion.
They don’t expect to have a vaccine for this until next year.
My take: they seem to have this under control as “novel” as this virus may be. To expect a pandemic like a zombie apocalypse is being used to churn the market by Algos and day traders.
Long-term AAPL investors are very familiar with this game.
BUT: the flu did never force the Chinese government to shut down whole cities or companies like Apple to close their stores.
This is new.
Although I am pretty confident, that this won’t have any effect on Apple FY 2020, I am also sure that we will see some trouble in the next 3-6 months.
As a result, today I sold all of my AAPL stocks (nice 12k % ROI) and plan to get back in after the stock is trading 20-30 bucks lower.
I can’t see any positive news in the next weeks that are able to propel the stock to new heights, especially when I think of the Aprils conference call.
What is lying beneath this date…who knows, but the next 6 months will show some turbulences.
For an options trader there is opportunity in turbulence. I hope you are right.
You are a trader, not an investor. Thank you for proving my point.
I only decided to try another strategy.
Unless those shares were in a tax deferred/free account you are going to take a substantial tax hit on those gains. Tac monies are gone forever, never to be seen again. A less expensive way to protect yourself from an unexpected events caused decline is to buy protective Put options. If the event occurs the options will go up as your shares go down. If the event does occur your protective Put options expire worthless, but that expensive is a lot less than the tax on 12,000% gains.
From now on, I will have to pay 25% on my profit.
Because of my long investment, I have a nice 7-figure base for future Investments in AAPL
I thought long about this step but the actual all-time-high and the implications of the corona virus made me nervous….the first time in 17 years.
Maybe I was wrong, the next 6 months will show that.
https://www.npr.org/2020/02/19/806960651/the-wide-ranging-ways-in-which-the-coronavirus-is-hurting-global-business
The lead story on Hong Kong’s South China Morning Post is very negative.on this topic Down load the free AP
https://www.scmp.com/economy/china-economy/article/3051534/coronavirus-chinas-manufacturing-supply-chain-pummelled-all