Apple’s new pet: The Black Swan

“Apple has yet to reveal what will end up being a ‘black swan’... Yes, if the threat of a long squeeze is realized, it could sail down there without even a tail wind. And while I don’t doubt the margin compression story on Apple, I think they’ll make it up on volume in home computing dominance,” Count Bitcoin writes for Seeking Alpha.

“This Swan could be gray or black, and could take any form for Apple. It could be as simple as Apple TV working,” Bitcoin writes. “Or when 80% of Windows users switch to tablets that operate as capable desktops – bursting with a massive App Ecosystem, as well as luxury suites of Adobe programs for Apple’s legions of writers, designers, artists, and musicians who have galvanized around Apple’s products.”

“Android will continue to gain in mobile, but Apple users stay with Apple with fierce loyalty. Windows users will undoubtedly switch to Apple, and Apple will find itself alone on the coffee table and/or workdesk of virtually every person who uses a computer at home and has to do more than just surf the web. Not to mention the millions of teens using earbuds to relieve their sensory deprivation (Public Education) across the U.S.,” Bitcoin writes. “Sorry Google, but Android devices are not ready to play in the home, not yet. Apple’s home computing dominance has just begun to warm up, and its mobile business, like any complex organism, will fight ruthlessly and tirelessly for survival and eventual dominance.”

Much more in the full article here.

Apple leads tech rally

“Shares of Apple Inc. and Texas Instruments Inc. led an early tech sector rally on Tuesday, lifting the Nasdaq Composite Index back up above 3,000,” Benjamin Pimentel reports for MarketWatch.

“Apple stock gained 2.4% to $543.70. In a note, ISI Group analyst Brian Marshall cited China Unicom's announcement of more than 300,000 preorders for the iPhone 5 set to go on sale on Friday. China Unicom is China's second largest carrier,” Pimentel reports. “‘We continue to believe the iPhone 5 will be in about 100 countries and about 240 carriers by the end of this month,’ Marshall wrote.”

Pimentel reports, “Also on the rise were shares of Texas Instruments, up more than 3% at $30.81. Late Monday, the chip maker narrowed its earnings and sales forecast for the fourth quarter.”

Read more in the full article here.

Former Rochdale Securities trader arrested in fraud scheme involving Apple stock

“The FBI arrested a former trader at the Connecticut firm Rochdale Securities on Tuesday in a fraud scheme involving Apple stock, U.S. prosecutors said,” Reuters reports.

“According to a criminal complaint filed in federal court on Monday, David Miller bought Apple shares for himself ahead of the tech giant’s Oct. 25 earnings announcement, then told his employer Rochdale the trade was for a customer who would bear the risk if it lost money,” Reuters reports. “As a result, Rochdale was left unexpectedly owning over a million shares of Apple and had to sell them for a $5 million loss.”

Read more in the full article here.

“Authorities say Miller worked as an institutional sales trader for Stamford-based Rochdale Securities LLC,” The Associated Press reports. “They say he executed a trade to buy 1.6 million shares of Apple Inc. stock on a day the company was scheduled to announce earnings.”

“Prosecutors say the scheme was designed so Miller would profit if the stock price rose, but it declined,” AP reports. “They say Miller falsely claimed he made a mistake in a client’s order.”

Read more in the full article here.

MacDailyNews Take: Genius.

Apple’s Bob Mansfield cashes in 35,000 AAPL shares ahead of fiscal cliff

“Apple's recently re-upped Bob Mansfield has cashed in 35k shares of his stock at a price of $582.21 a share,” Matthew Panzarino reports for The Next Web. “At that current valuation, the stock is worth a payday of roughly $20,377,507.50 to the long-time Apple vet.”

“Mansfield is still in posession of 29,548 shares and stands to take possession of another 150,000 shares in June of 2013 and March of 2016 if he stays with the company,” Panzarino reports. “Recently, Apple appointed Mansfield as SVP of its Technologies group, during a restructuring that saw SVP Scott Forstall ousted and his responsibilities divvied up between other staff.”

Read more in the full article here.

Bond guru Gundlach slaps $425 price target on Apple Inc. stock

“I’m getting the feeling lately that Apple is now approaching the bottom of its recent correction,” Marc Vigod writes for The Motley Fool. “Apple has gone through similar corrections in the past, only to prove time and time again that these were buying opportunities. It seems you can’t go more than an hour now on CNBC without hearing some sort of Apple bashing. Everyone is an expert on Apple these days, including bond guru Jeffrey Gundlach. The other day on CNBC he slapped a $425 price target on Apple. Can anyone now be an expert on Apple stock?”

“Now, I’m not sure about you but I usually don’t take my tech stock investing tips from bond gurus. I’ve been in the tech industry for over 15 years now and follow the sector closely, so maybe I feel better equipped to gauge Apple’s prospects than a bond guru,” Vigod writes. “Gundlach argues that because Apple shares have gone up rapidly they must retrace back to their starting point of $425. Interesting logic, right? I must add that Gundlach is talking his own book; he has disclosed he is short Apple shares [bold emphasis added - MDN Ed.]. I’d expect nothing less from a bond guru opining about tech stocks.”

Vigod writes, “Apple sits on the largest cash warchest of any company in the world. If Gundlach’s price target is achieved, that would mean Apple would be trading for $300, if you back out the net cash on the balance sheet. With over $50 in earnings per share for 2013, that is a P/E of 6.”

Read more in the full article here.

[Thanks to MacDailyNews Reader "David E." for the heads up.]

U.S. stocks fall to lowest level since August; Apple extends plunge to 23 percent off all-time September high

“U.S. stocks fell, sending the Standard & Poor's 500 Index toward its lowest level since August, as a European Union official said a decision on unlocking funds for Greece may not be made until late November,” Rita Nazareth and Sarah Jones report for Bloomberg.

“Apple Inc. (AAPL), the world's most valuable company, retreated 3.1 percent, extending its plunge since its September high to 23 percent,” Nazareth and Jones report. “The S&P 500 lost 0.7 percent to 1,384.22 at 3:28 p.m. New York time. The Dow Jones Industrial Average fell 60.97 points, or 0.5 percent, to 12,871.76. Trading in S&P 500 companies was 10 percent above the 30-day average at this time of day.”

Nazareth and Jones report, “‘It's hard bargaining for Greece,’ said Alan Gayle, a senior strategist at RidgeWorth Capital Management in Richmond, Virginia, which oversees about $47 billion. ‘The risk of a recession is still out there. Apple might be a victim of its own success because it's risen so much. There's nothing wrong with the company. Yet with its huge market cap, as Apple goes, so goes the broader market.’ ... Apple, the most valuable company, slumped 3.1 percent to $540.65. The shares entered a bear market yesterday, after falling more than 20 percent from its recent high... Equities tumbled yesterday as investors' focus turned to the budget debate and Europe's debt crisis following President Barack Obama's re-election.”

Read more in the full article here.

Related article:
Apple shares hit new all-time intraday and closing highs – September 19, 2012

U.S. stocks deeply in the red in post-election selloff

“Stocks remained deeply in the red in a post-election selloff Wednesday, triggered by worries over the looming ‘fiscal cliff’ and as fears over Europe’s economy reemerged,” JeeYeon Park reports for CNBC. “The Dow tumbled below 13,000, while the S&P 500 broke 1,400, both for the first time since early September. ‘It's now how quickly we can focus on the ‘fiscal cliff’ and coming up with a resolution-that’s certainly the next item on the agenda for the market,’ said Art Hogan, managing director of Lazard Capital Markets.”

“The Dow Jones Industrial Average briefly plunged more than 350 points in its biggest one-day loss in nearly a year, dragged heavily by Bank of America (-5.43%) and JPMorgan (-4.52%). The S&P 500 and the Nasdaq were also sharply lower. The CBOE Volatility Index, widely considered the best gauge of fear in the market, spiked above 19,” Park reports. “All key S&P sectors were firmly in the red, led by energy and financials.”

Park reports, “Apple [AAPL $562.435, -17.7645 (-3.06%)] fell more than 3 percent, pushing the tech giant down a jaw-dropping 20 percent from its all-time high of $705.07 in mid-September. The stock is now trading in bear market territory.”

“Ratings agency Fitch said Obama needs to move quickly to avoid the ‘fiscal cliff,’ adding that failure to address the issue would likely result in a downgrade in 2013,” Park reports. “Wall Street had favored Romney and the Republican ticket in part because it preferred their approach of retaining tax cuts, and making spending cuts. The Obama Administration favors raising taxes on the richest Americans, and also increasing capital gains and dividend taxes.”

Read more in the full article here.

[Thanks to MacDailyNews readers too numerous to mention individually for the heads up.]

A Romney win would hurt Apple very badly – Nigam Arora

“A Romney win would hurt Apple and General Motors very badly,” Nigam Arora writes for Forbes.

“Both of these companies are highly dependent on China for their growth,” Arora writes. “Romney has repeatedly stated that he will declare China a currency manipulator on his first day in office. Such a declaration would likely lead to a trade war.”

Arora writes, “Chinese consumers are nationalistic... Apple will find itself in a much worse position than General Motors. Apple will be hit with a double whammy, falling sales and falling margins... In my analysis, a trade war would result in Apple stock falling under $400.”

Read more in the full article here.

Related articles:
How Romney and/or Obama should have answered Candy Crowley's Apple assembly question – October 17, 2012
U.S presidential candidate Romney vows to get tough with China, tackle unfair Chinese trade practices – August 28, 2012
Mitt Romney: Does President Obama think Steve Jobs didn't build Apple? – July 18, 2012
Photos of Mitt Romney with his Apple iPhone and iPad at his Lake Winnipesaukee home – July 15, 2012

Foxconn denies plant strike report; Apple shares down with many U.S. stocks

“U.S. stocks declined on Monday after the World Bank cut growth forecasts for East Asia, highlighting concerns about the global economic climate and corporate profits on the cusp of the quarterly earnings season,” Chuck Mikolajczak reports for Reuters. “The World Bank reduced its growth forecasts for the East Asia and Pacific region and said there was a risk the slowdown in China could worsen and last longer than many analysts have forecast.”

Mikolajczak reports, “According to Thomson Reuters data through Friday, 91 companies in the Standard & Poor’s 500 have issued negative outlooks versus 21 positive preannouncements, for a ratio of 4.3, the weakest showing since the third quarter of 2001.”

“Apple Inc shares shed 1 percent to $646.19 and was the biggest drag on both the S&P 500 and Nasdaq 100 indexes after China Labor Watch, a rights advocate group, said that a Foxconn plant in China that makes Apple’s iPhone was crippled by a strike,” Mikolajczak reports. “Foxconn, a Taiwanese company, denied the report.”

Read more in the full article here.

New iPhone 5 sparks praise, higher target prices for Apple shares

“Apple Inc.’s new slimmed-down iPhone is getting an upbeat reception from Wall Street analysts, who on Thursday raised share-price targets on the company,” Matt Jarzemsky reports for The Wall Street Journal.

“The upbeat reception, which was helped by the company’s plans for quickly getting the new iPhone in customers’ hands, indicates analysts expect further increases in the stock price of the world’s largest company by market capitalization,” Jarzemsky reports. “‘The iPhone 5 launch exceeded our expectations on the specs and the pace of the rollout fronts, and we think there could be further upside to our estimates,’ J.P. Morgan analyst Mark Moskowitz wrote in a note to clients Thursday.”

Jarzemsky reports, “Mr. Moskowitz reiterated his ‘overweight’ rating on the shares-similar to a recommendation to buy them-and his price target of $770. Some analysts at other firms raised their share-price estimates, with Deutsche Bank boosting its projection to $775 from $650 and Barclays increasing its target to $810 from $750. Shares of Apple hit an all-time closing high of $682.98 Thursday, and are up 66% so far this year, more than four times the gains in the Standard & Poor’s 500-stock index.”

Read more in the full article here.

Apple price target: $950 per share

“Today I am updating my 12-month Apple price target to $950 per share. This price target represents an expected share price appreciation of 52.8% from Apple’s closing price of $621.70 on August 10th, 2012,” Robert Paul Leitao, the founder of the Braeburn Group and author of the Posts At Eventide, writes for Seeking Alpha. “I expect share price appreciation, on average, to trail behind the rate of earnings per share growth over the next 12 months as Apple’s massive market cap influences the share price performance and as the company’s price-earnings multiple continues to contract.”

“Over the next twelve months, I anticipate reported revenue growth of roughly 50%, corresponding earnings per share growth of about 60% and the aforementioned 52.8% rise in the share price value,” Leitao writes. “I anticipate 12 months from today a price-earnings multiple of 14 times trailing 12-month earnings, suggesting a slight compression in the multiple from today’s valuation of 14.61 times trailing 12-month earnings of $42.55 per share. For the four fiscal quarters ending June 29, 2013, I expect trailing 12-month earnings of about $68 per share.”

Read more in the full article here.