Tuesday, November 11, 2003
aapl - will the cool kid ever turn into a winner?
APPLE is always cool. It has been and it will be. What it hasn't been good at, is to translate that cool, hip image into appropriate shareholder value. Several emotional investors, who bought the product, loved it and invested in the company, learned to hate the stock.
This has been my experience, Loved the company, hated the stock. What i find intriguing, is sometimes the love of their products blinds good investment judgement. My good friend chuck here is clearly clinging on to some dream in this blog entry where the potential of apple as a high growth e-commerce play is brought up.
To be fair, apple has been firing on all cylinders. They came out with revenues of $1.7B and said they'd make about 1.9B$ in the calendar Q4. Great news. Puts them up at a P/e of 50 for the past fiscal year with growth hopes pinned heavily on the music service/ipods. would I take that risk? probably not.
As for my dear friend's hope of apple turning into a ecommerce play, i'd say that unless they start carrying products from other brands, possibly, other products not in the product line, i wouldn't consider them an ecommerce play.. Do i consider Dell an ecommerce play? No.. they have 10s of millions credit cards, but i don't buy books on dell.com.
I think the best hope for Apple is to parlay this IPOD/iTunes service into digi-music domination and substantial share of that huge 13B$ pie in the US and 17B$ pie worldwide..
-ravi
