Apple Stock Pricing manipulated by
machine decisions, not human choice
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Posted on 01/09/2016 2:13:04 PM PST by Swordmaker
AAPL 0.53%'s stock is undervalued based on its cash position, Sean Udall, a tech stock expert recently argued.
But just how undervalued is Apple's stock? According to Udall, it is "f'ing absurd."
Udall noted the only factor that really matters when evaluating a company from a balance sheet perspective is its net cash position. That is, total cash minus total debt.
Apple's net cash position is approximately $150 billion to $160 billion.
Udall continued that Apple's net cash would be "well north" of $250 billion when factoring in all the money the company spent on stock repurchases and other shareholder friendly initiatives. He added that at a $250 billion net cash position investors are buying the company at a valuation that is just above 2x net cash given Apple's market capitalization of around of $530 billion.
"It's f'ing absurd to say the least," Udall said. "The absurd only becomes more ludicrous if one adds back the cash flow generation."
This raises the natural question: if Apple's stock is so attractive at 2x net cash, why is the stock lower by nearly 12 percent over the past year.
According to Udall, the dip in Apple's stock is due to "machine driven raids," along with "fear and crashes." He added "this is what what happens when there are no humans in charge of trading anymore."
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Talk about being hoisted on one's own petard.
Good one. I’ll wager that you posted the above on a computer.
I learned in business school the one share of stock is worth exactly what someone else is willing to pay for it.
Yep. And not a penny less than what someone who has it is willing to sell it for. I offloaded some AAPL in the summer, but do not wish to part with it for its current price.
IDIOT!!! That is a theoretical cash position unless it is allowed to come back to America. I would go along with what Donald Trump has been saying. Charge Apple and the others 10-15% tax to bring the billions back home where they will not be reinvested (that is a despicable lie) but given out to shareholders
No, Baron, Cash in the bank is cash in the bank no matter where you have it saved. Apple has cash in the bank in the USA and off-shore. It only gets discounted if it is brought back into the USA. Apple beat Donald Trump to that proposal to have a 10-15% repatriation tax instead of 35%. . . by several years. Apple has been campaigning to bring that money home for years, money Apple has already paid the income tax on where it was earned. It's real cash no matter where it is and Apple invests it all the time. It's invested now. Apple frequently spends that cash for plant and equipment upgrades.
Again, you haven't got a clue about what you are talking about.
By the way, what would be so bad about paying it out to stockholders OR investing it? Either way it will get invested in America in some form or other.
You know its a lie about reinvesting in America beyond their new Calypso Louie designed mother ship in Cupertino California. But Apple has earned this money abroad so if goes to shareholders Its fine by me just so long as they pay a `10-15% tax
My, my, my, Baron, you do go on and on and on with your lies. Apple has just purchased land in the Silicon Valley for more new facilities, gotten permits for a new $2 billion data center in Nevada, and is looking to expand their presence in Austin, Texas, yet you claim Apple would not invest in America. What a load of Bull Pucky, Baron.
Apple also just bought a company called Emotient which can determine human emotions from facial expressions. That's investment.
In addition to all that, Apple just registered the domain names Apple.car and Apple.auto yesterday. There will be investment in the USA. Not even a nice try, Baron von Munchausen.
96.96 is where AAPL finished.
“NEVER MARRY A STOCKâ€
‘96.96 is where AAPL finished.
“NEVER MARRY A STOCK”’
That price is called a “buying opportunity”. ;-)
If you really want to buy AAPL let it sink some more to about 65-70.
Plus XIAOMI is eating Apple alive in China and will soon do the same in America.
All technology diffuses and the CRApple Iphone will soon be rendered meaningless as smart phones become more commodified each year. I give the iphone 2-3 years before it crashes to irrelevance like the iPod has
Xiaomi is doing well because they build iPhone look alike phones. If there were no aspirational devices to sell, they would flop. Xiaomi is a parasite living on Apple's designs. Before Xiaomi can ever even play legitimately in the world market, much less in America, it has to get its infringement issues taken care of. Otherwise it can't bring its products in to sell except piecemeal through sneaking them in by selling them individually on eBay.
Apple doesn't play in the commodity phone market.
You have it wrong way around. Apple copies Xiaomi phones after Xiaomi steals Apple prototypes from the Chinese engineering labs
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