David Lentz

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  • MacWorld to Follow Floppy Disk Into Extinction
    One might look upon the series of "Special Event" webcasts/keynotes this past year as a test run to see how product rollouts do when they are not bunched together in January (AFTER the biggest shopping period of the year is over).

    I've thought for years that Apple was nuts to announce new products in January -- instead of just before Thanksgiving. I'm glad to see them making some changes to do away with that practice. I'm sure it was a problem within Apple to target product rollouts to a specific extravaganza in January.

    Much better to serve the food as soon as the cooking is done, rather than trying to artificially target a predefined serving time.
    Dec 18 09:05 am |Rating: +1 0 |Link to Comment |View article
  • Apple Falls Flat as Market Rebounds - Is There Really Investor Confidence?
    It's all kinda eerily reminiscent of the gold bugs, and their chants of "gold is money!". After a few months of tanking gold prices, while the Fed was doing exactly what they thought would cause gold to explode, the gold bugs learned to quietly (well, almost quietly) watch the markets and take their cues from the markets instead of their beliefs.

    Sadly, it appears that the tide is starting to turn for the gold bugs, and the evening air will soon be filled with their shrill cries once more.
    Nov 24 09:15 am |Rating: 0 0 |Link to Comment |View article
  • Apple Falls Flat as Market Rebounds - Is There Really Investor Confidence?
    Zach, I am comforted by the still-vociferous AAPL fanboy community that I am not missing the boat by having sold my AAPL LEAPs a while back. I plan to use some of the proceeds to buy new Macs in the coming year, and reinvest the rest when we approach lower levels (60? 40? who can say? the market's crazy). There can be no definitive rally in AAPL until the chorus of boisterous fanboys are subdued by their rising losses.
    Nov 24 09:11 am |Rating: 0 0 |Link to Comment |View article
  • Amazon, Apple, Google: Buying on the Way Down
    Averaging in as one approaches a bottom is not a Bad Thing, not even an especially Risky Thing.

    But determining approximately WHEN a bottom is at hand is A Very Risky Business.

    Consider that IF this is truly the collapse of a global credit bubble, and not merely a housing bubble, that the bubble may still be inflating and has not yet exploded. Numbers of the amount Total Credit (government+corporate+... seem to show that it is still expanding, despite the gratuitous implosion of a lot of toxic debt and shrinkage of portions of the debt markets. Apparently, Ben Bernanke and other central bankers, intent on inflating our way out of deflation, have been creating credit at a sufficient rate to create a net expansion of the credit bubble. A pity that most of the credit they have created is being hoarded by those who got the bail-outs.

    Imagine if, just as the housing industry is approaching a bottom -- say, sometime in the summer of 2009 as various mortgage restructuring programs build up a head of steam -- and housing prices are within 10% of having bottomed, suppose that the credit bubble finally pops. The most likely sign of that at this point would be a cascading series of sovereign defaults, with the USofA somewhere along the chain.

    What do you think AAPL, GOOG and AMZN will be trading for at THAT point? And how long will poor Fred have to hang onto his purchases until they are breaking even? The only way Fred's scheme works is if we have a V-shaped recession, and if we are somewhere close to the inflection point. We could easily have neither of those things be true.

    Granted, this is a worst-case scenario. But a better way to attempt value-based investing is by following the tenets of Ben Graham, the way Warren Buffett has tried to do so over the years. That methodology is a MUCH better way to pick entry points for purchases during troubled times.
    Nov 15 09:50 am |Rating: +1 0 |Link to Comment |View article
  • Risks Remain, But iPhone's Fundamentals Should Help Apple Surpass Expectations - RBC Analyst
    Ranchr -- I agree most emphatically. Here in the Ohio Valley, I visited the Keystone Apple Store a couple of days after the new Macbook roll-out. The rest of the (upscale) mall was deserted, with the Apple Store being the only place with any customers at all.

    That said, the traffic at this particular Apple Store on that particular day was the lowest I have ever seen, with about 2/3 to 3/4 of the floor space being unoccupied (as opposed to the 10%-20% that is the norm). Not many were exiting the store with purchases. I plan to check again on Black Friday.

    My guess is that Apple will see a modest (25%, maybe 35% worst-case) drop off in sales volume on a year-over-year basis in the next two quarters. That will move it even farther away from the rest of the consumer electronics field, as nearly all of the rest are going to be struggling to turn a profit. And I suspect that Apple's emphasis on the consumer, rather than the corporate markets, is going to serve them well, as I doubt that ANY corporations are going to be refreshing their PCs for a couple of years. Consumers will do the irrational thing and blow their last paycheck (literally) on iPhones. HPQ is gonna get hurt, big-time. And Dell just might be extinguished.
    Nov 13 10:12 am |Rating: +1 0 |Link to Comment |View article
  • General Electric Moves On Down the Largest Company List
    An interesting additional thing to have shown would have been the percentage change in their market caps. Without looking, I'm fairly confident that the market cap of every company listed is smaller today than it was a year ago.

    If one looks at these in terms of industry groups (financials, manufacturing, consumer staples, etc), there is a clear rotation. Again, this isn;t exactly news either, but it's a nice way to quantify the sector rotation.
    Nov 12 09:24 am |Rating: 0 0 |Link to Comment |View article
  • Will Apple's Q1 2009 Revenue Estimates Be a Blowout?
    ummm ... I see no mention of the reports of a 20%-30% reduction in Macbook orders to manufacturers.

    Maybe robust iPhone sales can propel the comply to exceed analysts expectations.

    Prolly a Good Idea to hang around a local Apple Store over Thanksgiving weekend and see how many people are exiting the store with new purchases.

    Rampant enthusiasm for stocks -- any stock -- tends to tell me that we have a long way lower to fall.

    Full disclosure -- I may be buying a couple of new Macs in January, depending on what they announce at MacExpo and what the pricing is like.
    Nov 11 11:05 am |Rating: 0 0 |Link to Comment |View article
  • Apple Could Crush Competitors With a $99 iPhone
    While I am certain that cheaper iPhones are in the future (just review the history of iPod pricing), it is not in Apple's game book to pump out lowball products. There wasn't an $800 Macbook, and the Mac mini, the cheapest Mac available, is cheap only when you consider the package you are getting for the money. In terms of absolute dollars, the mini is a lot more than the $300 and $400 junque PCs you see at places like Wal-Mart, that are matched in price only by their ability to do work.

    When you figure out how Apple can make 30% margins on a $99 iPhone, then you will see it happen -- but chances are, Apple will figure out how to do that before you do.

    I know that they will NOT get there by stripping out functionality.
    Oct 28 08:28 am |Rating: 0 0 |Link to Comment |View article
  • How Low Will Apple Go?
    While I am certain that the coming quarterly financials will be another blowout number, the stock price reflects the future, not the past. I visited the local Apple store yesterday, to check out the new notebooks, and while there were people buying them, the place was emptier than I have ever seen it before. While in the past, the available floor space is usually AT LEAST 50% occupied by customers (or wannabe customers), and usually more like 75%, yesterday it was well under 25%.

    Don't count on the Christmas quarter being anything at all like the preceding 3 quarters, and the one after that will be worse still. I like AAPL, but there's no point in foolish expectations. I'll buy in when I see consumers returning to the stores.

    Also, the lowball earnings guidance should set new lows -- it will be interesting to see how Oppenheimer pitches the guidance next week.
    Oct 16 10:03 am |Rating: 0 0 |Link to Comment |View article
  • Deflation Changes the Rules
    But-but-but ...
    how could Google buy AT&T and still keep its corporate motto?
    Oct 09 09:33 am |Rating: 0 0 |Link to Comment |View article
  • Awaiting Apple Earnings and Guidance
    One last thing when contemplating taking Apple private -- there are not many investments for that amount of money that return in the range of 25%-30% (Reuters reports Apple's return on equity to be 27% for the last 12 months).
    Oct 08 12:21 pm |Rating: 0 0 |Link to Comment |View article
  • Awaiting Apple Earnings and Guidance
    The precise wording on forward guidance will be really interesting. I suspect it is being sliced and diced a thousand different ways right now. The other thing that will be interesting is whether or not Steve Jobs attends the earnings webcast -- usually he does not, unless there is something that is viewed as of major strategic importance to the company to be discussed.

    If the stock were to fall to the $60 regime, there is the potential of taking the company private via a debt-leveraged stock buyback scheme or (because debt is pretty hard to come by in this economy) via a consortium of well-heeled investors + the (in a quarter or two) $30+B in cash within the company. I can see Steve Jobs, Bill Gates, Larry Ellison, and other Silicon Valley billionaires kicking in enough to do this.

    Apple is a tremendous generator of profits, and would be an outstanding thing to have as one's private company in an uncertain world. Seems like billionaires, watching their equity holdings shrivel and wither, might want to take cheap, profitable companies private. Maybe even Warren Buffett might overcome his aversion to tech companies if the price was right.

    If the economy ever improves, they can always sell them back to the public at huge profits in a future IPO.
    Oct 08 11:58 am |Rating: 0 0 |Link to Comment |View article
  • Awaiting Apple Earnings and Guidance
    Roger -- I believe the earnings announcement is scheduled for 10/21 -- that's about a week after the expected/rumored new product intro on 10/14.
    Oct 08 11:33 am |Rating: 0 0 |Link to Comment |View article
  • Awaiting Apple Earnings and Guidance
    papita -- if you think that the market will bottom before Apple reports, then you have absolutely no idea about what is happening in the global economy.

    How many people will be buying Macbooks and iPhones if the unemployment rate is 25%? How about if the credit card companies fail?

    In today's WSJ, the front page story is that one mortgage in six is under water in the USofA. The state of California is requesting a bailout from the federal government. The national debt has jumped up by about 50% in the past couple of months, after doubling over the past 8 years. There is a very real possibility (possibility, not probablility -- I hope) that the United States might suffer economic collapse, and idiot senators and representatives are throwing hundreds of billions of additional debt on the bonfire.

    And you think that the markets will bottom in the next couple of weeks?

    Get real.
    Oct 08 10:36 am |Rating: 0 0 |Link to Comment |View article
  • Awaiting Apple Earnings and Guidance
    Zach, what do you think the chances are of Apple announcing a stock buyback program, to deploy some of that huge cash cushion they have and support the stock price? It would seem to be a desirable thing to do, not only for the stockholders, but to support the compensation and bonus programs for the employees.

    I expect an increasing number of companies with ready cash and good profits to be weathering the storm this way. Several already are.

    How would a significant stock buyback program (say, $15B) at Apple change your thinking?
    Oct 08 10:27 am |Rating: 0 0 |Link to Comment |View article

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