Friday, September 26, 2008

Apple and The Troubles

So I'm at the mall yesterday looking for a gift for my daughter who is turning 13. She wants an iPod capable speaker set up for her bedroom. (Madness I tell you).

Anyway, I wander into the Apple store and am greeted by 1 and then 2 and then a group of 3 helpful Apple employees, which leads me to look around and notice that I am one of maybe 3 customers in the store... AT LUNCHTIME. So my buddy and I stop at a local restaurant for lunch and overhear the waitresses talking... "This is even slower than yesterday".

Is it possible that all the shoppers went to Washington with John McCain yesterday?

Look we don't know where the economy is now, only after the fact to we have any clue what happend so I won't say recession or depression instead I will refer to our current economic situation as The Troubles. Cool huh, non committal but ominous.

Look, Apple is great, the iPhone is going to sell like hotcakes, maybe 40-50 million units next year alone. As of today (or by the end of year) The iPhone will be available in 72 countries!
Earnings will break records every quarter. Just not as fast as it would have been. Whatever was left of the US Economy has been ripped to shreds over the last couple of weeks. Apple does not exist in a vacuum sales will be negatively effected. How negatively effected is anyones guess but it is all but assured that sales will be off.

So, when Peter Openheimer stands up on October 21st (aprox) he will announce record earnings, unprecedented growth, and the stock will get killed on very conservative future earnings estimates (unless it doesn't). Mr. Oppenheimer will take several questions regarding the Troubles but will as he has in the past decline to comment on the economy or how much it plays into Apples earnings estimates going forward

Apple's earnings will be less that what they might have been but they are the best in class competitor in all the business segments they compete in (computers, handsets, music players) and will be the dominant player in these segments when the troubles are over in maybe 15 years (I know not funny)

Bet on the long term

Writer loves breakfast cereal and is long Apple. Eat whatever cereal you like but don't do it because this guy said so. Same with Apple.

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