254 am on Dec 03, 2017 Permalink Jim Rogers said... James, I don't think that raising the asset allocation would do anything to increase the market value of Apple stock in the eyes of investors.

P/E 2.0 and P/E 1.0 are trading at around 12. And Apple’s stock has continued to grow ever higher, up about 45% in 2017. If P/E 2.0 is a mere 13, Apple’s stock will eventually crash off the cliff. This is like the time that Apple broke out of “disruption” and became the world’s main computer maker. It can happen again. 1:19 am on Dec 03, 2017 | Permalink

Jim Rogers said…

Jim, As you point out and as you would like to see, there’s probably some overlap in that I’ve covered some of it. I’ve never had a negative feeling about Apple. From the market perspective, Apple is a “monopoly.” Apple had the biggest share of market cap, in 2016, in the world. So there was a lot of pressure on them to be innovative, to be different. I understand that. But the one thing I wouldn’t have expected them to do in my lifetime that no-one else has done has been to make products that are fun to use and can be re-used long after they’re obsolete. Which is important, given the state of tech. I also understand that companies’ focus is never on one single item. So when one comes along, someone has to “make that happen.” This is one of the things that I remember about my first job back in 1998 was being told that an iPhone was going to come out in 2000. I was 24 and my wife was 32. We were in Silicon Valley, not New York. By the end of 2001, when it was clear that they would not have a working product, there were “too few” available to even start the project. I can only imagine what it would be like if people today have a whole lot of “innovation going on” every day. And I know a lot of people here believe that Steve Jobs would be more appreciative of that today than he would be if I got it with him in the 1990s. 2:33 am on Dec 03, 2017 | Permalink

James said…

This is an interesting analysis. Do you think Apple “oversold”? I think there may be some room for some overvaluation on the shares. In my view, what Apple needs to do is look to lower the “asset” part of P/E to a more reasonable level. This would go against a lot of shareholder philosophy that we’ve seen from Apple. For example, I think that the current P/E of 13 implies that Apple is looking at its stock price as not being very reliable as a measure of the long-term performance of its stock. If P/E falls further, Apple will have to make some changes to its asset allocation in order to be in a better position to raise more stock. But that may not be easy. To illustrate, let’s say Apple raises it P/E to 10 with no dividend cut. And let’s say we’re still at the end of our ten-year tenure. If Apple doesn’t increase its P/E by that amount, it may be the only company in history to do so. A fall in asset prices could result in a lower return on a share of Apple stock than an increase in P/E: a 10-year tenure of at $140 million, to $135 million, and an increase of $10.80 billion or 4 percent in stock price, versus the same ten-year stint priced at $85 million.

2:54 am on Dec 03, 2017 | Permalink

Jim Rogers said…

James, I don’t think that raising the asset allocation would do anything to increase the market value of Apple stock in the eyes of investors. It may increase the “rebuttable presumption” that Apple is a high-quality company that will continue to be a top-tier company in the years to come, in comparison to other tech stocks. In any case, with the way that P/E is calculated the share price will probably be more volatile over the next several years, especially in relative terms to the “asset value” of Apple. It is, however, pretty safe to say that the value will continue to rise. 4:28 pm on Dec 03, 2017 | Permalink

John Chown, said…

“I know a lot of people here believe that Steve Jobs would be more appreciative of that today than he would be if I got it with him in the 1990s. That could be a little inflated, but the core market value of Apple is in about line with the value from 1995 on. If they can do exactly what they started doing in 1997, then they should all be doing great. The market only seems to have an interest in Apple at that stage in time, and a year or two later is

So let's go through the basics of drawing people and give you a few tips if you want to follow along with the process from start to finish. The Mars 2020 rover is a large spacecraft designed to carry human life support supplies on their surface, such as food, water, and oxygen.
Your browser is out-of-date!

Update your browser to view this website correctly. Update my browser now

×