Apple is Amazing

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Warren Buffett Betting That Apple Is Worth $2 Trillion (TheStreet.com)

:yikes:

Apple (AAPL) to $1 trillion? Who cares.

The real bet is the one Berkshire Hathaway's (BRK.A) (BRK.B) chief Warren Buffett may be making: $2 trillion Apple valuation.

"He clearly views it as a long-term hold, and it will certainly compound over $1 trillion in the not too distant future -- and then double again in the next five years," says former hedge fund manager and Buffett expert Whitney Tilson. "I don't think it's a bad bet, as a Berkshire shareholder I am happy he owns Apple."

The billionaire's holding conglomerate Berkshire Hathaway hiked its stake in Apple by a whopping 23% to 165.3 million shares in the fourth quarter, according to a filing earlier in the year. Buffett has shown a voracious appetite to eat up Apple as the tech giant returns massive amounts of cash to shareholders via dividends and buybacks. It doesn't hurt that Apple's iPhone remains a dominant force in the smartphone market and services revenues is strong.
 
Dionysus said:
Warren Buffett Betting That Apple Is Worth $2 Trillion (TheStreet.com)

:yikes:

Apple (AAPL) to $1 trillion? Who cares.

The real bet is the one Berkshire Hathaway's (BRK.A) (BRK.B) chief Warren Buffett may be making: $2 trillion Apple valuation.

"He clearly views it as a long-term hold, and it will certainly compound over $1 trillion in the not too distant future -- and then double again in the next five years," says former hedge fund manager and Buffett expert Whitney Tilson. "I don't think it's a bad bet, as a Berkshire shareholder I am happy he owns Apple."

The billionaire's holding conglomerate Berkshire Hathaway hiked its stake in Apple by a whopping 23% to 165.3 million shares in the fourth quarter, according to a filing earlier in the year. Buffett has shown a voracious appetite to eat up Apple as the tech giant returns massive amounts of cash to shareholders via dividends and buybacks. It doesn't hurt that Apple's iPhone remains a dominant force in the smartphone market and services revenues is strong.
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$2T? No chance. Apple's pipeline of new products appears to be limited. They'd have to add another iPhone level device and maintain the current iPhone sales which were diminishing last I read.
 
Dionysus said:
Appears
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Do they have a hit to match the iPhone. That might be unprecedented in consumer electronics. If they do, Tim Cook should be given the award for CEO of the Millennia.

I understand that Apple would keep that close to the vest if they had that in development.
 
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Seattle Husker said:
Do they have a hit to match the iPhone. That might be unprecedented in consumer electronics.
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I hear you, doubling their already massive market cap seems unthinkable. Who knows. It might not be in consumer electronics. I think Apple has big ambitions and they certainly have the means to fund them. Our world is going increasingly mobile and digital and that bodes well for them in any number of areas, imo.

What really intrigued me about the article though is that Warren Buffet sees something he likes — a lot. Maybe he knows more.
 
Dionysus said:
I hear you, doubling their already massive market cap seems unthinkable. Who knows. It might not be in consumer electronics. I think Apple has big ambitions and they certainly have the means to fund them. Our world is going increasingly mobile and digital and that bodes well for them in any number of areas, imo.

What really intrigued me about the article though is that Warren Buffet sees something he likes — a lot. Maybe he knows more.
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Agreed. Warren Buffet is the Oracle of Omaha, afterall. He boasts that he prefers tangible business models that he can see and use. That's why he eats a Dairy Queen and is a major shareholder for them. Then again, he's reinvented the insurance industry overnight with technology driven insurance companies (Geico and Symetra). I'm sure someone at his level is privy to information us peons only dream of. Still, Buffet isn't a major consumer of electronics. He drives a modest Cadillac he purchased 6-7 years ago.

I keep waiting for Apple to take a bigger turn towards cloud and subscription services. At this point it seems their user base is locked in but not growing significantly.
 
Apple stock closed at $201 today, up six percent, based on yesterday’s quarterly news. I think they hit the $1T market cap if it gets to $207.
 
Dionysus said:
Apple stock closed at $201 today, up six percent, based on yesterday’s quarterly news. I think they hit the $1T market cap if it gets to $207.
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Apple did hit $1T today, but we will have to see where it closes



Feb 1996
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Even at current valuation, Apple generates 5.5% free cash flow yield on its market cap which is better than the S&P average of 4.8%. A true powerhouse.
 
Dionysus said:
Nice. I remember when Jobs came back in 1997 and thinking they might have a chance after all.
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And he personally bought a crapton of AAPL around that time.
Plus, he took no salary (or maybe it was $1)
 
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Joe Fan said:
And he personally bought a crapton of AAPL around that time.
Plus, he took not salary (or maybe it was $1)
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That $1 is a bit of a misnomer. CEO's do that for perception purposes. They then get monumental stock stakes and giant bonuses that often time pay out with even mediocre performance.
 
Joe Fan said:
Plus, he took not salary (or maybe it was $1)
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I heard that he did the $1 annual salary and had his compensation tied to performance/profit to demonstrate that he only wanted to get paid if he made Apple successful again. I don’t know if that’s true but it jives with the perception of his legendary will to get things done.
 
AAPL has greater market value than the following companies combined:
- Boeing
- Toyota
- McDonalds
- Nike
- Volkswagen
- General Motors
- Airbus
- Adidas
- Twitter
 
Bevo Incognito said:
Just read that, before the Iphone was introduced in China in mid 2009, Apple sales there were less than one billion per year.

Last year, Apple had sales of 13.3 billion in China.

This year, they have already done over 12 billion in sales in China in the first six months of their fiscal year. They are looking at sales of 26 billion this fiscal year.

So from less than a billion in sales to 25-26 billion in sales in roughly three years.
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And they don't even have 10% of the smartphone marketshare in China today as the 5th most popular smartphone brand.
 
Apple, Google, IBM, and other companies drop the college degree requirements for hiring.

I think this is great and more companies should follow suit. I suspect a lot of young people are finding college to be prohibitively expensive, especially when they could be spending those years developing skills in the areas that interest them. The internet has made it possible for motivated people to self-educate in many ways.

Google, Apple ditch college degree requirements
 
Cool visual on global brand ranking over the years (play the video). Apple shows up in 2011 and is like a rocket to the top.

 
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The combined market cap of the 4 largest US companies (AAPL, MSFT, GOOGL, AMZN) is 13.8 x higher than March 9, 2009.
From $326 Billion to $4.5 Trillion

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Look at Apple over the past year ... doubled in share price from ~$150 to $309 (as of today)

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Sold about half of my stake on Jan 2nd just because it was too large a percentage of my overall portfolio. I think earnings will be great in a year due to the 5G phones coming out later this year.
 
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