"we are bullish on the stock but pe expansion seems unlikely" This is the one sentence Melissa Lee was pounding the table on. What she neglects to report to her world wide audience is that he loves the stock with a $780 price target. He then goes on to say that he rates it a buy with a $780 price target and expects earnings growth will be strong enough to demand higher prices if the multiple remains flat" This is an important sentence that she neglects to say on air. I wonder why? Is she purposely leaving out material facts to benefit her hedge fund friends that she sits on the fast money desk with?? Milonovich even states " that even if apples multiple doesnt budge the stock still has plenty of upside left if it hits UBS' earnings per share targets of $51.50 for 2012 and $62 for 2014" This all seems like important info that should have been spoken about to her global audience. Why is she allowed to pick and choose what sentences she wants to read from an obvious market moving report? How is this legal??
It may be legal, but it's unconscionable for a journalist to omit important information like this. Melissa Lee has a penchant for stoking the anti-Apple fires at every turn, seriously calling into question her journalistic integrity.
the fast money panel should be looked at by the sec so we can see who bought puts today before the show started. I wish I could take a huge position in a volatile name and then be able to come on tv to a world wide audience and bash the heck out of a stock.
Apple’s upside may hinge on new products
Apple is trading near its lowest valuation in at least a decade.
The downspin for Apple Inc.’s shares over the past couple months has put the stock near its lowest valuation in at least a decade, but one analyst said Tuesday that recovery for the shares is not likely to come from investors deciding to assign a higher multiple to the business.
The stock took another spill on Tuesday, with Apple AAPL -1.76% trading down more than 2% to $573 by late morning. In an early note to clients, Steven Milunovich of UBS said he remains bullish on Apple, but added that “significant P/E expansion” is unlikely for the shares, which are currently trading about 11.2 times the company’s estimated earnings for the next four quarters — more than 60% below its average multiple for the last 10 years, according to data from FactSet.
The lowest forward P/E seen by the stock in that period was 10.3.
“The experience of Google and Microsoft suggests that P/E expansion largely is over once margins peak and earnings growth moderates,” the analyst wrote. “Even bursts of faster revenue growth don’t tend to boost the multiple.”
The fear that has crept over Apple’s shares over the last two months has been a combination of worries about lower gross margins going forward, as near-term launch of so many new products like the iPhone 5 and iPad mini will crimp profitability in the next couple of quarters, and that wireless carriers may start pushing back on the high subsidies they pay to Apple to sell the iPhone, which is a major source of the profits on the device.
The other big fear over the shares is the lack of a catalyst from new products. Apple rode to an all-time high leading up to the launch of the highly anticipated iPhone 5, and the fact that all of the company’s products saw a major re-design this year means the coming year is likely to see only incremental changes to the products — unless Apple finally launches its long-rumored TV set.
Still, Milunovich rates Apple shares as a buy, with a price target of $780 that is about 36% above the stock’s current level. He believes strong sales of the new products are still likely to drive the stock higher.
“Although we don’t expect much multiple expansion, new products still have the potential to drive earnings growth and create value by earning cost of capital,” Milunovich wrote. “More important than gross margin dilution is whether new offerings increase operating profit.”
Sentiment: Strong Buy
She has no friends. She hates aapl and aapl fan boys. Today was a perfect storm for FM - all "on the desk" were perma bears. The old guy who knows 0 re aapl just jumped on the bear feeding frenzy. No objectivity, seemed canned and planned. No big deal.
Sentiment: Strong Buy
it may be canned and planned but it will still move the stock in the morning. They probably all bought puts throughout the day knowing they were going to be able to come on and bash the stock at 5pm. They should have a 5 day window where they can not buy or sell a stock 5 days before or after mentioning it on the air like Cramer does. Why dont they??
You as well!! Just read your post. Its unreal how this obvious bashing is allowed to go on. There were 3 reiterations of buy ratings today that CNBC also fails to mention. Just unreal. Every sentence they utter allows the machines to take over during the day.