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Kind makes you feel that Cortland Apple is really a crab-apple.
Another reason to invest in real assets like real estate over stocks.
Thanks to an accounting- rule change for which it lobbied, Apple gets to book revenue from sales of bundled products such as iPhones -- which include hardware, software, services and upgrade rights -- more quickly than it used to. In short, one reason Apple’s earnings have been so high is accounting inflation, and the market realizes this.
The easiest way to see the rule change’s impact is to look back at the two sets of numbers Apple reported for fiscal 2009. Originally, the company said it had $5.7 billion of net income for the year on $36.5 billion of revenue. Then in January 2010 Apple retroactively adopted the new accounting principles and restated its previous numbers. The restatement boosted Apple’s fiscal 2009 net income 44 percent to $8.2 billion. Revenue was revised to $42.9 billion, 17 percent higher than originally reported.
Nothing changed economically, of course. Only the accounting did. On the surface, though, Apple’s valuation looked cheaper under the new reporting regime than under the old one.
he FASB rule change had two main parts. One related to so- called multiple-deliverable arrangements, while another covered software sales. When Apple sells an iPhone, for example, the hardware and software are delivered at the time of sale. Other deliverables include the rights to future software upgrades and other features.
The old accounting rules required Apple to defer large chunks of its revenue and recognize the amounts gradually over each product’s economic life. While the details are complicated, the gist under the new rules is that Apple is allowed to record more revenue upfront.
Many companies have been eagerly awaiting this rule change because they feel it more closely aligns their revenues with their costs. Apple, for example, has been at the forefront in pushing for these changes. Under the old rules, Apple had to recognize all iPhone revenue over a two-year period. These new revenue recognition changes now enable Apple to recognize the iPhone hardware revenue as soon as it is sold, while the revenue recognition for the software is based on an estimated value that is spread over the life of the iPhone. Apple early adopted in the first quarter of fiscal 2010 and the impact to their results was substantial. In fact, the adoption of the new accounting principles increased Apple's net sales by $6.4 billion, $5.0 billion and $572 million for 2009, 2008 and 2007, respectively.
While the change in timing of income recognition makes comparison with pre-change
reporting periods flawed or possibly unreliable, the new rule does seem to reflect
economic reality a lot more realistically, which acounting is supposed to.
RB, If apple owes future deliverables in connection with the sale, then I'm not so sure.
We missed the boat on APPLE. Someone on these boards who understands this stuff, let's talk Facebook. When GOOGLE closed at $90 I was thinking Yahoo etc...I had no idea what or could become. Is FB JUST a social media site or with all their loot will they buy/grow themselves into a mega media company.
Sorry if this sounds clueless....but after FB closes on that first day should I go in with guns blazing and buy the hell out of it. (:
What if you lost 25% of the money you are contemplating putting into FB? Besides being upset, how would this change your financial picture?
Hilarious. What a financial fktard Riversider is.
Look at zerizon, AT&T and sprint. All three took a hit to earnings due to long term contracts and fees paid due to APPL.
Now would it not make sense, unless you think verizon, sprint and att is going outta business APPL should bank the earnings sooner. The very earnings/cash flow/expenses they are being hurt by?
Sorry about the misplaced modifier in the end. But i think it's still ok
Back on topic. I bet more people, and a much bigger % of manhattanites owners net worth has evaporated (10x APPL mkt cap) through 2003-2012 with their eyes wide open.... And with me screaming that we are in a bubble than mindless APPL buying.
And I assume Riversider did not buy APPL at $60, but he did buy his riverside coop at $100k in 1992. And hence his disdain for appl's run up from $240 to $500 in 4 months. Hilarious.
KeithB. I liken/value fb, google etc to an advertising/media company with a side order of technology/software co. But I doubt any of the current companies will be the 'one' ring to rule them all. I'm sure some kid in a basement will program a website that will bind, google, facebook, Craigslist, and chow hound. I'm buying hard asset cos. like gm, coned. Coke, cummins.
Keith, I doubt very many truly understand facebook, and there are some stories on how they count hits and whether those numbers are right.
>I'm sure some kid in a basement will program a website that will bind, google, facebook, Craigslist, and chow hound. I'm buying hard asset cos. like gm, coned. Coke, cummins.
Interesting, now he's buying stocks. During the market swoon in the summer, he was talking about how his money was safe in cash. Now stocks are above last spring's prices. Change the story to fit the times and it's all good.
Don't take stock advice from a real estate forum.
My story iz... MANHATTAN RE SUCKs, buying $150K in stks, which represent 1/5 of my family's yearly Cash Flow and 1/50 of our net worth is NOT really that big of a deal... note my wife's 403b and my 401Ks are indexed funds bought btwn 1997 to 2012... we've always maxed out on those...
but yes, I am picking some stks... so STFU cuntzburger.
Did you lesarn how to do that by being a TA in business school?
Or by making beaded jewelry with your mom?
How much of your net worth was earned by your wife who was "touched by thousands"?
Did she marry you for your ape-like charm or was she taken in some baad-like ritual?
Uhhhh...if Apple had facebook's PE, it would trade at something like $3,000 a share. To say Facebook deserves a premium to Apple, when Apple has been growing revenues and earnings much faster than Facebook, is silly. No, its insane.
Apple, on a EV/FCFE basis, or forward p/e or just about any other basis amazingly trades at a discount to most other large tech bellwethers, HP and MSFT included. By most measures, even to Dell. Now who honestly thinks any of the last three will grow faster than Apple?
One could argue they are all overvalued, but its hard to argue Apple is MORE undervalued than them (or IBM, CSCO, Intel, GOOG, and certainly Facebook.)
I meant more overvalued.
That's ok Jason, we are more focused on how much of ape67's net worth is based on dishonesty in business dealings, like when he was a NYC residential landlord involved in suits with his tenants, or when he rented an apartment and he didn't pay the last month's rent. Or just google w67thstreet and IRS.
How much of his cash flow might go to settle a sexual harassment lawsuit?
Dear Apple I'm leaving you.
And down $130 off the high just a month ago.
Apple doubling from $500 a few months back whilst w67 looked around and focused for a few days. 0% chance.
Sprint doubling off of $2.40. W67 said 100%.
So wtf is your point Riverturd?
Chance of nyc re going back down to $500psf. 100%.
Flmaozzzz. And you do know you could have sold apple for $700 for many days wo moving the price, right? You didn't sell a $700 well fk you.
Oh huntersburg. Did ya lose power cause of sandy? Eating canned foods, begging the Starbucks on w67 to charge your cell phone? POS ground floor studio bought for $10k in 1993 on ave c flooded to the ceiling? All your vinyl records and paperbacks since grammar schools ruined!!!!
Come back soon Hunterburg. SE ain't the same wo our resident fktard.
There cash flow from operations and free cash flow did not change due to the rule RS mentions. So any actual DCF valuation would not be affected by any of this.
There there moron. Show me a stk that'll double in 6 months and ill give you some cyber ego props.
Hey what's the weather like somewhereelse?
Now officially off 20% from peak....
Wow. Still above the $10 a share from a few years ago. But do go on and pick on the ninnies that bought at $700 peak.
Oh wait a goodddaaaaammm minute! That's what w67 is doing by pointing out foolz like you Riversider who think manhattan bubble prices will remain with us forever!!!!
Backward looking I told you so, you've nailed that riverturd. I'd be impressed if you said buy aapl at $350. Saw it rally to $700. Then if you said sell! You know like w67 did with sprint. Flmaozzzz.
w67 said to buy Sprint at $5, said it was going to $15, said he would sell at $10.
w67 = one trick pony.
And what's your trick cuntsburger, besides being on streeteasy? Fk I made $1.432mm in the last 4 yrs being on streeteasy. I've started 3 companies. Got 2 patents.
My driver is on fire. Still squatting 585. Wtf do you do floppylabiachick? You follow posters on SE with a pad and pencil. Go you. There's a bitter insane worthless pos ss Chking, sub basement dwelling, studio living, stray cat feeding, haven't had sex in 20yrs, with way too much time on their geriatric hands person on SE, ...... It ain't me.
Have a nice life wasting it away on SE. SE is just a side show for me. It's where I come to vent against the everyday RE morons I come across in real life, sometimes it bleeds into the financial imbecility all around me. Makes me happy to smack around ericho, or urbandigs, johnmiller, Ali or Riverturd. Cause they just remind me of real life morons I come across in my business dealings. I'll nod and smile whilst they expound on the virtues of RE!, Citibank shares!, AIG!, and apple!
Then you find out later, they invested $2k in apple and their wife is a RE Borker. Flmaozzzzz. I can't swing my golf club wo playing into a group of 4 'working' re borkers. Gooooddddaaammmmmit. I'll kill myself if my kids ending up sixpercenters!!!! Ugggggg.
But I'm a one trick pony so ill keep my next pick for myself..... Anyone that wants in can email me off line.
>Fk I made $1.432mm in the last 4 yrs being on streeteasy. I've started 3 companies. Got 2 patents.
And one dead father.
$502 Now down 29% from peak
a lot of people own it around $420, so that's not an unresonable target. Earnings report is out Jan 23, so maybe buy in a few days and sell after report.
Actually $420 sounds reasonable. That puts it at around 15 p.e. if you average out 2010, 2011, & 2012(proj earnings numbers).
Apple (AAPL) this afternoon held a conference call with analysts to discuss its fiscal Q1 results, which featured revenue that slightly missed expectations, and profit per share that slightly beat analysts’ average estimate.
Shares are down $40.10, or almost 8%, at $473.01 $52.01, or over 10%, at $462.
AUCH! 10% down after hours... that HAS TO HURT. sorry longs :-(
> Another reason to invest in real assets like real estate over stocks.
Please real estate addicts: put absolutely everything you have & plan to make in the future on RE. it's your ONLY chance to strike it rich.
> Gooooddddaaammmmmit. I'll kill myself if my kids ending up sixpercenters!!!! Ugggggg.
same thing here bro, add to that one majoring in "creative writing" (studying how to become a zeropercenter)
> maybe buy in a few days and sell after report.
How are the carriers doing?
Over the past 12 months:
AT&T: up 17%
Verizon: up 17%
Sprint: up 152%
Since the close, all are down about 0.5%.
sounds like Sprint is a real winner.
More close their eyes and buy real estate
Real Estate has less tail risk, unless of course you lever up too much.
>> Actually $420 sounds reasonable. That puts it at around 15 p.e. if you average out 2010, 2011, & 2012(proj earnings numbers).
It hit $420 today. Are you a buyer on it now?
No, Definitely not, but the price "is" more reasonable.
At what price are you a buyer?
I see, you are of the school there are no bad stocks, just bad prices.
Not a big fan of tech, but I suppose if the company were trading for less than the value of the cash held, I would reconsider.
>I see, you are of the school
I think he sees that you started a thread specifically dedicated to apple, so he's asking a rather natural question about the price you would buy the stock in question.
Right now, Apple has about $145 in cash per share. So you'll wait for it to hit that level, and then you'll just reconsider, but still no guarantees - is that an accurate restatement of your position?
Yep, Not a buyer of tech in general. More in the value camp. However if someone were to buy apple here as opposed to six months ago, the bet would seem more reasonable. At this price/juncture, I think it's a question about how much apple can monetize it's tv idea. At book value, there are new reasons to buy.
> However if someone were to buy apple here as opposed to six months ago, the bet would seem more reasonable.
It is at a lower price now, is that what you are saying?
Thanks, RS. I have bought. At $145 cash plus $40-50 of current annualized earnings, good enough for me. More drop => more buy. We shall see...
You ignorant fool
>More drop => more buy. We shall see...
It dropped more. Did you buy more?
How about Riversider?
MW: Ah, AAPL... it's pretty clear that their transition from being a innovation company to a company that manages the innovation they've already created is just about done. Look at their pipeline - it's all improved versions of what we have already got: lighter iPads, faster Macs and iPhones with more stuff. Beyond the endless rumors of a really expensive television, Tim Cooke's big idea seems to be AAPL moving from the hardware business to the information business – namely iCloud.
MW: I think AAPL's best play is to take what's left over cash from their very ill-advised stock buyback plan and to start BUYING technology companies. If they don't have the creative wherewithal to do it internally - they have the checkbook to make some serious strategic acquisitions. Here's idea #1: buy companies OUTSIDE of media, technology and entertainment.
Zerohedge? I could have sworn..