Apple is growing. But Jobs is dying. A few Apple folks I've spoken to suggest it could represent a problem for Apple if Jobs...well...leaves. :(

Good luck. Not sure where Apple stock is going to be when the Dow hits 6,000.

Apple certainly looks undervalued and the company is doing very well.

However, Jobs is vital to the company. Not to say that Apple cannot find a way to succeed without Jobs, but it will have to "prove it" as the prior attempt to do without him was a failure.

Best case, Jobs' absence will drag on the stock until June.

I bought AAPL for my previous company at mid-single digits (think about $7), then owned it personally, sold it mid 2007. So I sure would like to step back in too. But I am on the sidelines for at least a couple more months.

Incidentally, shortly before we first bought AAPL, it was trading below net cash.

In general, seems to me you'd want to buy stocks if you think it is around the bottom in the market. Within 1-2 qtrs and 20-ish percent, anyway. In that case, there are so many solid growth companies trading at low to very low valuations. Most don't have company-specific problems like an ill CEO. If you don't think it is around the bottom, no reason to buy stocks yet.

Your other moves made sense to me, this one doesn't. Apple is a luxury brand not a need brand...money is tight and it's going to get tighter.

What do I know though, I'm broke as hell:D

One of the sector that hasn't been affected by the economy is games. People are still buying games.

My thoughts exactly.

From last Friday's WSJ:


I Once Was Chic, but Now I'm Cheap

By DANIEL AKST

A couple of years ago, fed up with Microsoft Windows, our whole family switched to Macs. Since then we've often giggled delightedly at the commercials portraying a PC as a hapless fat guy in a suit. A Mac, after all, is "the computer for the rest of us," as Apple's ads used to say.

We own five Macs, along with iPods and other Apple paraphernalia. But recently, when we needed a new computer, we ended up buying a PC running Microsoft Vista. The reason is simple: Macs nowadays are computers for the rich.

What's the price of looking this hip?

Like eating only locally grown food or majoring in gender studies at college, Macs have become luxuries that command a premium out of all proportion to their utility -- unless their utility is simply to broadcast your own disposable income. For a long time the extra cost of a Mac wasn't outlandish and seemed justified by its great design and ease of use. Our years of bitter experience with Windows systems involved far too much hair-tearing over random glitches and security problems. To us, going Mac was the price of computer sanity.

But the affordability gap has lately yawned into a gulf. Today, with money scarce, a Mac costs roughly twice as much as a comparably equipped PC -- and in my recent experience, the PC performs impressively indeed.

The $646 Dell we recently bought -- complete with 20-inch flat panel display and gigantic hard drive -- runs superbly, thanks to ample RAM and a discrete video card. Surprisingly, we even like the much-maligned Vista operating system.

Windows PCs are more prone to viruses and other malware than are Macs, but Norton Internet Security has proved to be a useful antidote. Once widely reviled as a system-strangling resource hog, this defensive package is now so light on its feet that it operates on our system invisibly.

Re-embracing Windows hasn't been guilt-free. I've been an ardent Mac proselytizer ever since my own conversion experience two years ago. I even got a used Mac for my mother. So I felt bad at first about buying a PC. Yet when I thought about why, I had to admit that the reasons were Veblenseque. We like to think that we're pretty cool at our house, so getting a machine running Windows seemed downright plebeian. But doing so helped me to realize, in turn, the extent to which "cool" is too often connected with "cash."

It's cool, for example, to spend a fortune on solar panels or hybrid SUVs that will never pay for themselves in saved energy, even though the money could do far more for the environment spent in some less ostentatious way. Shopping at Whole Foods is cool, as is obvious from the hipsters in the aisles -- and the high price of the groceries. This kind of cool disdains luxury labels like Rolex and Coach yet works just as hard to impress.

Most of the cool people I know use a Mac. My sense is that they like to think of themselves as egalitarian sorts unencumbered by snobbery -- rather than, say, brainwashed cultists obsessed with class-signaling. Yet at today's absurd prices the Mac is even less than ever "the computer for the rest of us." Instead it's a well-designed status symbol for the elite -- another way that people with money can distinguish themselves from hoi polloi.

The current financial crisis has many causes, but surely the death of thrift has been among them. If there is a silver lining to the grim economic news that besets us daily, it may be that cheap will once again become chic. The sudden popularity of netbooks -- tiny, low-cost, portable computers that focus on the basics -- is a case in point. People are discovering that they don't need to spend $1,500 on a machine to send email when a $350 netbook will do the trick. If we keep this up, we may all soon find ourselves living within our means.

There's no sign of such a cheap little device from Apple, and I'm not even sure the company wants customers like me and my family. Recently it announced a new 17-inch laptop that starts at $2,799, enhanced with a longer lasting battery and other neat features. But Apple left its cheapest computers -- the Mac Mini line -- unchanged despite puny hard drives and scant RAM compared with competing PCs.

Apple has put a lot of effort into getting customers to "switch" in recent years, and my entire family did so. But a couple of our Macs are going to need replacing in the next year or so, and much as I find Apple products to be well designed and fun to use, we're going to switch back to PCs unless Mac prices come down. Cool just isn't worth it anymore.









Tim

I bought - and continue to buy Apple stock. They have a small percentage of the computer market. I see this growing - especially on the home computer end.

Their I-pod and I phone are selling well - also volume wise have a small percentage of the overall phone markets - I see this growing.

They have plenty of cash and are well positioned to both weather a recession AND go on a purchasing spree. It's one of the stocks I will continue to purchase.

Reality hasn't set in yet...it will and things will change. JMHO

A lot of little Jimmy's and little Janes are going to start hearing "Your old iPod is fine" and "You don't need a MacBook to do your homework, this $350 eMachines will do just fine."

Well then every kid at my Sons high school has a "need"

Spoiled brats!

you guys are thinking like old farts again. To us older guys - the Iphone and Ipod are wants - to the younger generation they are a basic need.

EGR High is in a different world :D

I bow to your track record, I'm just saying the others seemed much less of a stretch. I think maybe you live and play in a unique environment where people actually use their phones for those things rather than jewelry (which I suspect makes up a very large percentage of their customer base).

Believe it or not the gaming industry is fairly recession proof. When times are tough, parents don't have the money to take the kids to Disneyland or Disneyworld (plus travel expenses). Instead they'll go and buy a game for $50-60 and this will give entertain them for 30-60 days, so it's fairly cheap when you look at how many hours of entertainment you can get out of it. I follow daily companies like EA, Activision, THQ, etc and all of them have been getting killed and I think they have more upside than a company like Apple. Then again this time around I think we'll be dealing with a depression not a recession so everything that we believe is a "good deal" right now or "undervalued" might prove to be completely wrong if the markets tank another 50%. I can see the DOW under 5000 within 2 years and maybe in the 3000 range.

JMHO

I agree video games are more defensive in a recession. Just look at GME comps, far far better than other retailers.

I also believe Apple will continue to fundamentally do well for at least the medium term (1-2 yrs). The iPhone is only $199 subsidized and there may be an iPhone nano at $100, for a device that replaces so many other devices. Macs are so much more appealing than PCs for some people, and Apple still has small market share. An inexpensive "netmac" can certainly be made at a decent margin, if needed. iPods are fairly saturated but I think they will get another growth run as more people watch their tv and movies online and want to have them portable too.

Walk through the mall and the only stores that are still busy AND not covered with "70% off" signs are Gamestop and Apple.
What I am cautious about isn't Apple but AAPL.

Exactly.

Regardless of how fundamentally sound Apple is, or their business model and products are, in this current environment, a bet on AAPL is a bullish bet on the broad market as a whole over the next 6 month, year, or even 2+ years.

Good luck with that bet.

I friggen H A T E apple.

The smugness of their store minions sickatates me!

I had recieved a ipod for CHRISTMAS, 11months later it was the suck, and not working.

Drove 15miles in L.A. traffic to their store only to be told "we can't help you today, our appointments are booked"

did it once more a few day's later same great customer diservice.

Did it AFTER Christmas get this...... "well it's out of warranty, can I recycle it for you":eek: Hell will freeze over before they will see a penny from me.

i cleaned an M-1 carbine mint NRA 100% winchester same as my dad carried in the south pacific for 5 years and made a list of foo foo parts for it.

bought 1000 rds of federal ammo for it.

bought 1000 rds of 9mm federal 115gr fmj

bought 500 rds federal .45 230 gr fmj

cleaned hk/benelli black evil 12 gauge snotgun and made list of foo foo stuff

thought about spending money on my porsche and said "NAAAAAA" im having too much fun elsewhere.

and im about to boost the economy by buying an hk4

bought a multitude of various black/evil high capacity magazines/clips(whatever) for various platforms i have.

bought a 12 pak, drank some of it, and laughed at how i and obama made the economy SCREAM TODAY!

it will be a cold day in hell when i buy apple stock having as much fun in life without an iphone/ipod/iwhatever/blackberry/blueberry/purpleberry/

Just to clarify, I am not saying I am bearish on the market for years to come. I would like to see the market successfully retest recent lows, and to see an effective rescue plan for the banking sector (will take cubic dollars). I think there's a decent chance of seeing that in 2009, even 1H09. Whenever we do see it, stocks are cheap enough to work.

I saw an analysis of retailer valuations at the depths of the Great Depression. It struck me that we aren't too far off those valuations right now.

You go online and make an appointment. Works fine if you do that.

It's far too late. If they would have told me tht prior to the experation I might care to spend $$4 with tem.

They can burn in hell over their $mugness. F. O.A.D!

How should they have told you?

I think it's probably a good buy, actually. Whatever they are going to launch to the public is two years ahead of where we are today. They have a very paced pipeline of new products that won't be affected by Jobs' health. What *will* be affected are the actual product launches though. They need a new guy that can generate (almost as much) buzz like Jobs did.

@Jim Bremmer: As others have stated, you just hop online and book an appointment. They should have told you that the first time you showed up. It's a small price to pay for actually being able to walk into a store and (hopefully) walk out with a resolved problem, as opposed to having to ship it somewhere. Sorry you had a bad experience with them...they've been fantastic to me over the years.

Completely understandable. The same thing happened to me. Went to the mall with a malfunctioning laptop only to be asked if I made an appointment. I said no. To that, I was told no one could help me. I had to make an appointment. 12 hrs. in advance.

Apple's customer service is indeed garbage. The Genius Bar thing is a total joke. I know more about Macs than those...kids.

Apple's actually rated at the top of all computer companies re customer service.

You make an appointment, walk right in and see your person. You can make appts. online.

I bought my Daughter a new MacBook and we were having some trouble with it. Made the appointment, took in the machine in and within 10-15 minutes we were walking out with new machine.

You will find stories like this are beyond anecdotal.

You may not like Apple and you also may have had a truly bad experience, but overall they do pretty darn good for most folks. It also helps to know how their customer service works.

Right. I don't doubt they're rated at the top.

But not with me. Why?

Because of exactly what you stated. I don't want to go to the mall with the computer, peripherals, power cord, etc., and get turned back because I didn't make an appointment, particularly when it wasn't apparent to me that an appointment has to first be made. If I'm paying $500-$600 premium over Dell for an Apple, I want the damned thing fixed then and there when I walk in.

So, as a calmer consequence, I buy my Apple products out of state - no Genius Bar needed - or any of the other stuff involved with those overrated stores.

I also learned OSX and everything else involved with it backwards and forward. I want it so I never have to step into an Apple store again unless it's to just look around.

Whatever works, of course.

For me, I figure I have two options; take my machine somewhere or ship it somewhere. My preference is the quicker fix, i.e. taking it in. In the few times I've used the appointment system, I was able to get a next-day appointment or one later in the evening on the same day.

This works for me and has been relatively painless.

Congratulations on mastering OS X. I've been using it daily since 2001 and still learn new tricks every now and then.

But those kids know that you need an appointment to have an Apple product service.

Jeremy is right, to the youth of today, electronic gizmos fall closer to the "need" category than the "want". At least half of my buddies have iphones. Practically everyone has an iPod. Personally I went with the cheapest cell phone out there, since I don't need all the fluff, but to each his/her own.

While I've never owned a mac, because I'm a cheap bastard, I have noticed one thing. Whenever people complain about a mac, they never say things like "I hated the OS, it crashed all the time", they always say "not enough programs/games are made for it." Pro-mac people tend to say things like "it doesn't crash nearly as often as windows, it's a lot more reliable, etc." So it seems for the money you get reliability. Just an observation.

And hey, good idea on the stock pick, Wayne! I'm going to steal your idea and pick some up myself.

Just as an aside . . .

The Apple retail presence is very slick. We are becoming an Apple online/store vendor or more correctly a vendor who will sell to a vendor who sells them a product.

They won't deal directly with any vendor who does not sell them $1M +.

Inventory is supplied to their warehouses & only billed when sold.

As with most slick retailers, turns (and fast ones at that) count.

They have a complete store mock-up in Cupertino where they test every new product, every new display - basically every new idea. This is a science to them.

They can give stats about # of store visitors, # of those who bought & average sale. Now those are standard store specs but they can also tell you which displays are under-achievers by the amount of face time each display has seen.

So when you are in a store, just remember The Big Apple is watching . . .

Ian

Should have waited to buy stocks, the market dropped another 300 points yesterday, we're just a tick under 8000.

That is a really dangerous and not well thought through interpretation of GAAP. Sale of a device, which is a one-time recognition in a single quarter if there ever was one, characterized as a two-year "subscription?" I would not at all be surprised to see a restatement at some point.

I'll give you another example. I bought an iphone - actually my company did for me to be more specific. I was going to buy a Gtech - those retail for $150 or so - instead bought the dynolicious application for $19.99 - so saved some money there. Was going to buy a GPS for the car (or a car with GPS - I travel quite a bit) well the iphone GPS works just fine for my needs.

I'm helping my stepfather move his boat - his GPS is on the fritz - So I was going to buy a marine GPS with charts - actually went an bought a lowrance H20 gps - $269.00 and returned it - because guess what - iphone has an application I can download for $49.99. does the same thing - and the screen on the iphone is better.

I can even download movies and TV shows to it for the plane. Portable DVD player - who needs one?

I'm starting to sound like my wife - but I'm saving money... :)

True, having to make an appointment to have a face-to-face with an Apple tech is a bit of a hassle.

But with a Dell, there's not even that option. You get to talk to "Jeffrey" in India and then rummage around the basement looking for a box to ship it in.

At least with Apple you can bring the product in, have a reasonably capable tech work on it right then and there, if it needs major repairs they take it from you and send it back to you, if it qualifies for replacement they hand you a new one on the spot. (If there is an Apple store nearby, that is.)

Rarely do I need Apple's service. Granted, it's a hassle in itself to go online to Mac forums, read up on an issue, then expedite a solution, particularly on one's own time. And I wouldn't expect every owner to do that. But I like to know I can fix a problem immediately, instead of making an appointment, wait a few hours, drive to the mall, wait another few hours (or a day or two), etc.

Actually I have two years on site service from Dell. They come to me within 24 hours and fix it on site.

And you got that service because you're such a nice guy? :)

One year is included/free the second year was additional, I don't recall how much.

For buying one computer?

If so, that's a heckuva good deal.

It's on my business account but it was just one computer I believe...maybe two. I'll check.