The Unsinkable brian cork™

Brian Patrick Cork is living the Authentic Life

analysts can use 2013 as a LENS for 2014

December30

it’s that time of year once again – that hustling, bustling, busy time when almost everybody is thinking about holidays and merriment and family and giving while simultaneously looking forward to what’s coming next.

ponder, if you dare, AAPLAMZNTWTRFBHPQBBYGOOGSBUX.

do you see the relevance; a correlation?

so… here, I’m taking the opportunity to reflect back on the past year, and ponder ten (10) of the coolest things that Apple (of course because they lead the way in some much context) that Apple fans had to be thankful for over the last twelve months.

  • Free OSX Mavericks
  • Auto-Updates
  • Touch ID
  • 128GB
  • iTunes Radio
  • Gone Home
  • Jony Ive’s New Role (Senior Vice President of Design 0 a preamble to him becoming the next CEO)
  • iPad Mini with Retina Display
  • The new Mac Pro
  • HBO Go on Apple TV

NOTE: Apple’s stock always takes a dip after it unveils new products, because – as far as I can tell – investors and analysts value only brand-new industry-changing products and nothing else. but, every time they bemoan “just another” iPhone or iPad update, Apple goes on to post record sales, so I think these knee-jerk market reactions say more about the dubious qualifications for analysts than they do about the validity of Apple’s decisions.

most big news about Apple was about the company’s tax-avoidance techniques and analysts claiming that Apple failed to deliver any new products of note. (thankfully, it still isn’t making phablets, though they’ve been hugely successful for other manufacturers – providing profits are not important).

something to consider…

as Apple approached $700 in the spring and summer of 2012, two things happened:

  • some investors were getting too emotional, irresponsibly egged on by Wall Street analysts such as Brian White, who had a cutesy $1,111 price target, and Gene Munster, who couldn’t stop talking out of his rear with empty Apple TV predictions.
  • bulls discounted the impact of losing Steve Jobs and replacing him with no confidence man Tim Cook. Cook had to prove, one way or another, that he could produce something along the lines of iPod, iPhone or iPad. could he win over Wall Street like Jeff Bezos has at Amazon.com?
  • perhaps most importantly they gave Jonny Ives absolute control over design. this harkens back to the way Steve Jobs wanted and intended the company to innovate.

analysts never appear to learn.

every time Apple announces that its about to unveil something, the supposed experts practically demand that the company introduce another world-changing device like the iPhone or iPad. when that don’t happen they make a claim that the sky is falling (and make sure the stock does), bemoan the loss of Steve Jobs, and seem to enjoy saying “I told ya so” as Apple’s stock plummets. then when Apple launches the product (for example, the iPhone 5C and 5S) , it breaks sales records, sends Apple’s stock back up, and analysts somehow are shocked – even though it ALWAYS happens.

while it’s easy to understand how a stock like AMZN can outperform AAPL, there’s no explaining how posers, free lunchers and companies with very real question marks do it. I’m not saying these names on the chart on the next page will all crash in 2014 (though a couple likely will). but I am saying AAPL will perform alongside them or better if they somehow manage to replicate their 2013 magic (carpet rides).

so… there needs to be, or should be, some kind of requirement for being able to call yourself an analyst.

the outlook wasn’t much better for Intel, not because the company hasn’tcontinued to innovate, but because people don’t need as many of its microprocessors, and the ones they do need are less profitable than ever.

BlackBerry, which investors once thought might be broken into smaller businesses with some latent value, proved to be a near-total loss.

Google killed its much-vaunted 20% time – the policy of allowing engineers to spend a portion of their working time on their own projects – while insisting it hadn’t, leading to a furious (and public) debate among its employees about whether or not the company is still friendly to bottom-up innovation.

and, while Hewlett-Packard has put the disastrous acquisitions and rapid-fire leadership changes of recent years behind it, the best that can be said so far is that it’s gracefully managing its own decline.

while I’m at all of this, I must remind you all that Google and HP “hooked-up” (in any sense of the phrase) and hoisted the the HP Chromebook at you. the idea, or concept, anyway, has merit. however, it literally burned-up in your hands (U.S. recalls Chromebook 11 chargers; Google, HP pulled laptops from shelves last month). somehow I have this odd feeling that is Google’s legacy. that siad, I do hope they end-up pulling-it-off. that sort of collaboration and  innovation is good for all of us.

PREDICTION:

the world gets hip to this line of thinking in 2014. And not merely on a hunch or because it felt like time. Apple will trigger euphoria that, this time, will follow through. Because confidence lost will have been reestablished. so, we are back to me saying Apple hist $1000.

MOVING ON

it starts in January on the Q4 earnings call. I’m not sure if we’ll get any sort of pre-announcement from Apple, but there’s no question in my mind that while Amazon owned the holiday shopping season from an e-commerce standpoint, Apple will have owned it from a consumer electronics perspective.

we still don’t have any better idea of what Tim Cook’s “next big thing” will be than we did when he took over for Steve Jobs. but, we have iPad Air. A game-changing device superior to every other tablet or similar device on the market. don’t understate the importance of this release. if you’re only as good as your last game, Cook and Apple are pretty strong right now.

my eleven year old daughter asked me for an iPad Mini last night. I asked her “why?”. “It’s what we all want next” was her simple response.

if any analyst worth their salt has a kid in the same demographic he would role their college fund into Apple today. Our kids don’t just play HALO (actually mine don’t), they drive the Apple “Halo effect”.

for some reason, iPad Air has flown under the radar of my most observers, cast off a slightly lighter version of its predecessor. not so. it’s the real deal. It’s a game changer. it’s Tim Cook proving that he can take something meaningful from conception to implementation and beyond.

in 2014, he wins widespread confidence and ups the ante as AAPL takes it rightful spot at the head of the pack in tech and on Wall Street.

comparatively… Microsoft lost nearly a billion dollars on the Surface RT tablet, which was to be the device that pole-vaulted the company over Apple’s iPad and the dying PC industry. insiders revealed Microsoft’s ruinous internal culture, fostered under a leader who probably never should have been CEO, leading those same insiders to conclude that the only solution is a breakup of the companyMicrosoft bought Nokia‘s devices business, which would have been an astonishing turn of events a few years ago, but now felt like a lurch into an unsure future in which Microsoft remains an also-ran in mobile devices.

oh… and, the more successful Apple is, the more desperate Microsoft comes across. with people literally still in line at Apple stores for a shot at new iPhones, Microsoft clogged the airwaves with it’s classless apple-bashing ads. you know… the ones that mock Siri and skew the facts (like Google) to make it seem like only an idiot would choose an iPad over their windows 8 tablet? I actually like the look of Metro, but I wouldn’t consider buying from someone who is essentially calling me stupid.

all that said… it will likely pale by comparison in the wake of the scandals you will read about in the next couple of years about Bitcoins and Crowdfunding. the value of bitcoin increased at least 10-fold in 2013, thanks to heavy investment – by the media, which helped talk it up. both initiatives undermine a genuine value system and represent everything that is wrong with an economic ecosystem that is focused on instant gratification and not intrinsic value.

and, of course the media is behind all of this. the media is Satan’s answer to hope and fairness. how ironic, in the face of our very Constitution, that the media falls-back on like the vast and insidious army of hypocrites they actually are.

lifting up[!] 2014.

peace be to my Brothers and Sisters.

brian patrick cork

analysts and bloggers are such Rascals!

June27

so… personally, I just find this flat-out goofy. but, I acknowledge this is just how it all works.

Morgan Stanley Issues ‘Tactical Buy’ On Apple Valuation

today, Morgan Stanley analyst Katy Huberty issued a “tactical” buy recommendation on Apple (AAPL) shares.

“We believe the share price will rise in absolute terms over the next 60 days,” she writes in a research note. “This is because the stock has traded off recently, making short term valuation much more compelling.”

to be clear… Apple’s stock took a short-term hit recently because analysts like Huberty made a fuss over production issues coming out of Japan just after the earthquakes.

but, now, she notes that post-Japan production constraints have eased, and adds with improved component supply, “Apple is negotiating price cuts with some suppliers,” potentially boosting margins for the June and September quarters.” Huberty adds that “after meetings in Taiwan last week, we expect Apple order cuts to ease and iPhone/iPad production to begin ramping aggressively from August through year-end.”

Huberty adds that “Apple’s next iPhone will begin production in mid to late August and ramp aggressively” into calendar Q4.

isn’t this obvious?

as a direct result, AAPL this morning is up $2.34, or 0.7%, to $328.69.

why am I blogging about this?

…mostly because I do believe most people don’t understand how this is part of a game.

I called Huberty, but I know she won’t return the courtesy. but, she’ll read about it all, here.

consider prior posts of mine if only for perspective: brian cork on those Wallstreet Rascals!, Outside of the insiders, and After Hours Trading.

years ago, David Sugarman, himself, taught me that you should buy a stock never expecting to sell it. Apple has always fit that frame of reference for me. and, I always know that when analysts (and, more-and-more so today, bloggers) attack a stock, even indirectly, we know it’s an effort to create room and a buying opportunity for their “bank”. an example, here, is that we all knew the production issues in Japan would be short-term. they would impede retail initiatives. but, there was never any reason for someone with anyone “long” on Apple to be concerned. and, as many of you know, I’m convinced that Apple is a thousand dollar (or the equivalent after splits) stock inside the next five years.

what will always insult my sense of fairness and justice is that authorities understand this is part of the game and allow it by not enforcing “tactical” information designed to mislead citizens.

thank God, most of the day traders proved Darwin correct several years ago.

peace be to my Brothers and Sisters.

brian patrick cork

 

just so you know

May10

Last week the Dow Jones Industrial Average (“DOW”) plummeted close to 1000 points, and only began to right itself as the closing bell sounded. This represents the single most volatile trading day in market history. Just in case you forgot about this already; or, possibly failed to care – here is a link to the story: Link To Ridiculous Story – and another for good measure: Link To Another Ridiculous Story Discussing The Hapless Trader, however, this is my favorite: A mysterious day jolts Wall Street watchers.

The stock photo images of grim-faced and distraught traders on the floor and news reporters are priceless.

Several theories abound as to why, or how, such a thing could happen. Foremost amongst those rabid speculations was a story that some (rogue) trader inadvertently placed a coma in the wrong numerical sequence and initiated a enormous sale order that sent the automated systems into a tail-spin. That means something akin to: “he accidentally pushed the wrong button”.  Mind you, this (the event; I very am skeptical about the button) stopped the recent global enthusiasm and the markets upward trending, dead-in-it’s tracks. Markets around the world pulled back – generally stating concerns over what’s happening in Greece… for good measure…

The Greece “thing” has some merit. And, I’ll discuss that later this week.

In any event, that (all the rest of it) is likely nonsense (the theory, not the loss of enthusiasm; or, what’s not happening in Greece).

Today, markets are a bit more bullish, as is the DOW. I can prove this information by having you simply view this link:  The Dow on May 10, 2010. I’m quite clever with such things.

Okay… So, what has really occurred is: analysts and traders (think Goldman Sachs needing to “war chest” funds to cover their pending indictment) decided that by pulling off a well-orchestrated scheme stunt (also, and often, referred to, derisively, as: “shenanigans”), they could drop the market and take out a bunch of unsuspecting citizens. They probably shorted key stocks under index. They then picked their bottom-number and started taking buy-side positions in the same stocks knowing they would be bought up by day-traders (a most-excellent example of the sophomoric, if ever there was one) that thought they were buying into an upwardly trending market. So, having hedged their bet, they made big money going both ways at the expense of a lot of people reading this post.

Voila.

In the weeks to come you’ll read how the Securities and Exchange Commission (SEC) and Obama will call for some vague investigation. But, nothing will come of it.

Peace be to my Brothers and Sisters.

Brian Patrick Cork

What’s All This About?

"What am I looking at?", you might wonder.

Lots of stuff.

Meanwhile, here, I discuss events, people and things in our world - and, my (hardly simplistic, albeit inarticulate) views around them.

You'll also learn things about, well, things, like people you need to know about, and information about companies you can't find anywhere else.

So, while I harangue the public in my not so gentle way, you will discover that I am fascinated by all things arcane, curious about those whom appear religious, love music, dabble in politics, loathe the media, value education, still think I am an athlete, and might offer a recipe.

All the while, striving mightily, and daily, to remain a prudent and optimistic gentleman - and, authentic.

brian cork by John Campbell





photos by John Campbell

 

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