Wednesday, January 25, 2012

AAPL : Q1/2012 Massive numbers and History of the $400B barrier

Apple does it again: Surprised Wall Street yesterday, when AAPL presented a jump of more than 100% increase in profit and revenue line is equally impressive - as part of its financial fourth quarter of 2011. In light of the results, the company's stock was sent to an 8% rise in late trading on Wall Street - as it reaches a new all-time peak.
"Into 2012, I expect the strengthening of the iPhone, iPod - Touch and the iPad. Apple has more possibilities to exploit opportunities, including opening new retail stores and the expansion of additional channels", refers to Henry Sosnto, an analyst at Gabelli & Co for optimism in the report.  "I'd say AAPL have more opportunities in emerging markets, and is still very far from exhausting all the tasks which it can expand," he added. What to do with the money?
And  what enthusiasm? Apple reported a 73% jump in revenues to -46.33 billion, and net income of 13.1 billion (or 13.87 dollars per share) - a jump of more than 100% over same quarter last year.
The company introduces more cash flow of approximately -97.6 billion, which many on Wall Street wondering whether the company will use a distribution of a dividend or repurchase (buy-back) of some of its shares. Apple's CFO, Peter Oppenheimer, declined to address the issue directly to the conference call with analysts after the release of reports.
"While many believe that Apple will repurchase extensive, we estimate that less thought," notes Michael Ioshikami, CEO of YCMNET. "More likely Apple will pay grant one - time, rather than continuing dividend to shareholders."
As for individual sales of its flagship products, Apple surprised yesterday when he reported a 128% increase in sales of iPhones (about 37 million units total). Despite the strength in sales, many wonder if the company has nowhere to go - after such a successful quarter.
"Beautiful things will happen to Apple later this year too," says Michael Blackie, an analyst at Canaccord Genuity. "The company is still expanding geographically and trying to market the iPhone 4 in China, and only started selling it in January. This means that it will be reflected in its results in March next."
Those are good news, let us check what we can learn from the history of  companies reached $400B barrier:
Microsoft (MSFT) was the largest public corporation in 2000, with market cap of $586B. Today Microsoft is worth $250B.
General Electric (GE) replaced Microsoft as the largest public corporation, with market cap of $477B. Today the company is worth $202B.
Intel (INTC) market cap reached $424B in 2000 compared to $134B today.
APPLE (AAPL) market cap today $420B, the stock increased in value over 300% in the last three years.
Is it sustainable?
I don't know.

P.S: Apple is a Great Company but I expressed some of  my doubts in the past.

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