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ikkyu2 (99.51)

AAPL: part the latest

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November 08, 2012 – Comments (1)

I have written extensively in this space about AAPL, including some SWOT-style analyses and an occasional value pitch.

I won't recapitulate that; none of my basic ideas have changed.  I wanted my constant readers to know that I have a limit order to buy AAPL stock in at  $498.  The figure represents a 15% margin of safety for a scenario that I would describe as 'worst business case' over the next 2 years.  That's a little shorter time frame than my usual pitch, which is why I'm specifying.

Worst business case means things that happen in the normal ebb and flow of business operations - new product launches, supply chain hiccups, etc.  If a tac nuke hits Cupertino during normal business hours, or there were significant legislative or regulatory changes that were drastically unfavorable to Apple, those types of things aren't factored in.

Those of you who do math in your head will realize that I am saying AAPL is about fairly valued today in my worst-case analysis. 

1 Comments – Post Your Own

#1) On November 08, 2012 at 5:08 PM, ikkyu2 (99.51) wrote:

I am of two minds about Scott Forstall, by the way.  Letting him go is definitely pulling out a flower; but lesser weeds that turn the gears of day to day business at Apple also need not to be smothered.

As the architect of the most popular hardware/software/mobile device combo of all time, the guy was undeniably a great asset under Steve Jobs - because Jobs had the juice to keep him on a short leash.  He lacks respect for others, however, and he cannot be leashed by Tim Cook.

Forstall lacks CEO qualities - he is the opposite of a manager; he is nearly universally disliked - and because of that, he was never seriously considered for the top job.  Because of that, AAPL now has to cut him loose - it was the only option.  It remains to be seen whether Bob Mansfield can produce the next wave of innovation that would drive Apple's stock price to $5000; like black swan business events, I don't think this kind of question can be usefully predicted.

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