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Apple Zealots Go Overboard

Posted Feb 28, 2008 06:00am EST by Aaron Task in Electronics

Thursday should be a good day for Apple and its shareholders: At a Goldman Sachs conference Wednesday afternoon, Apple COO Timothy Cook gave a very upbeat presentation. Most notably, Cook reaffirmed Apple's target to ship 10 million iPhone units in 2008.

Cook also noted that while year-over-year iPod unit shipment growth was 5% in the December quarter --- a point of concern for some observers -- year-over-year revenue growth was 17%, the fastest for the iPod segment in a year. Cook attributed the strong revenue growth to the success of the iTouch, which he called  "the first true portable WiFi" device and a "very key product" for Apple.

The comments address recent concerns about iPhone and iPod sales that have been raised by various analysts, and summarily reported on by journalists like Barron's Eric Savitz.

In the accompanying video, Henry and I discuss the vitriol that always accompanies high-flying stocks -- especially amid a bout of weakness -- and the particularly high levels of emotion that Apple fans (boys and girls alike) bring to the discussion, which often devolves into a shouting match -- or worse.

The message: Don't shoot the messengers!

The subtext: Dissenting opinions about your favorite stock (or company) are good because they force you to rethink your rationale. And if you disagree with an analyst (or a blogger), don't yell and scream about it -- just take the other side of the trade.

40 Comments

Yahoo! Finance User
Yahoo! Finance User - Thursday February 28, 2008 01:05PM EST

Yeshol - the people who bash Apple always bring up ipods as the end all be all of the Apple existence as if the only thing Apple has created in the last 25 years is a music player. It's the software stupid. Not trendy accessories that makes Apple a great company. Remember how trendy the mouse was 20 years ago, what a gimmick that turned out to be. My desk top is Mac G4 from 1999! - all the PC's I've had were lucky to reach their 4th birthday. Some sheeple are satisfied with things that are good enough and some people a expect more.

patriot101
patriot101 - Thursday February 28, 2008 01:19PM EST

2004 Buy AAPL @ 18 sell @ 89 sell short on downside 2005 Buy AAPL @ 36 Sell @ 92 sell short on downside 2006 Buy AAPL @ 41 Sell @ 131 sell short on downside 2007 Buy AAPL @ 62 sell @ 204 sell short on downside 2008 Buy AAPL @ 114.50 hang on for the ride up Result: $1,255,340 profit in 4 years Now shut up

diane
diane - Thursday February 28, 2008 01:42PM EST

For you negative Apple observers.........walk in a Apple Store and " eat your heart out ! "

joseph
joseph - Thursday February 28, 2008 01:53PM EST

Dude, the problem isn't that these analysts are saying things that AAPL: loyalists don't want to hear, it's that they seem to be making stuff up just to say something bad for the sake of saying something bad. Fantasy iPhone worries. Big hoopla over iPod sales. Forget about the iMAC success and that they can't keep the MacAir in stock, focus on a half baked report about chip buys which almost assuredly only half or a third of the real story. Smuggled iPhones into China selling at a premium? What company WOULDN'T want that problem. Who is kidding who? Go look at the check out line at any Apple store anywhere. And bring your calculator. Frankly, I find the whole thing rather amusing and tinged with a lot of sour grapes and envy. I'm really sorry that you forgot to buy even a few hundred shares back in the day at 45 but you didn't because you weren't paying attention. Why should anyone believe these people now? My wife is keeping a log of all of the "predictions" she can find which turned out to be bogus with the intention of letting the authors know that someone is watching. The list is very impressive and makes for fun reading. P.S., Don't worry, I AM taking the other side of the trade and am having a nice day because of it. Thanks a lot.

joseph
joseph - Thursday February 28, 2008 01:55PM EST

Dude, the problem isn't that these analysts are saying things that AAPL: loyalists don't want to hear, it's that they seem to be making stuff up just to say something bad for the sake of saying something bad. Fantasy iPhone worries. Big hoopla over iPod sales. Forget about the iMAC success and that they can't keep the MacAir in stock, focus on a half baked report about chip buys which almost assuredly only half or a third of the real story. Smuggled iPhones into China selling at a premium? What company WOULDN'T want that problem. Who is kidding who? Go look at the check out line at any Apple store anywhere. And bring your calculator. ...... Frankly, I find the whole thing rather amusing and tinged with a lot of sour grapes and envy. I'm really sorry that you forgot to buy even a few hundred shares back in the day at 45 but you didn't because you weren't paying attention. Why should anyone believe these people now? My wife is keeping a log of all of the "predictions" she can find which turned out to be bogus with the intention of letting the authors know that someone is watching. The list is very impressive and makes for fun reading. ...... P.S., Don't worry, I AM taking the other side of the trade and am having a nice day because of it. Thanks a lot.

Rob
Rob - Thursday February 28, 2008 02:17PM EST

To the guys in this video. I agree that stating the facts is great. But guys like Eric Savitz and Toni S. have clearly gone overboard and there's absolutely no denying that fact. Publishing articles that are clearly irresponsible that are based on non-factual opinions rather than facts, especially after the stock has been beaten down over 40% in such a short period of time; is just plain brutal!!! Yes, we are extremely emotional, how can we not be??? We go to the Apple store and see lines every day of the week to buy, buy, buy more Apple product. The CEO and COO of Apple clearly stated at Macworld and at their earnings conference call that things were going great. All this recession talk is a joke!!!! Malls are absolutely packed every night of the week (well they are in L.A.), so what if you a few data points come in a little weak. We have not had two consecutive quarters of negative growth (definition of a recession), heck we haven't even had one. Changing back to the video, Eric Savitz has recently gotten better in his publishing. I hope he stays impartial.

Zato
Zato - Thursday February 28, 2008 03:05PM EST

Egotism is the driving motor of this world, and is why this world will soon burn to the ground. Wall street, the Mecca of egotism, the sellers of egotism to the world, the liars, con artists, manipulators and murderers, will be held accountable when it's time to settle old scores.

merle
merle - Thursday February 28, 2008 03:10PM EST

Pundits disagree with one another - with management - with their wives. Do your own thing - take what they say and check it out. They are worng about 60% of the time. Some of them had to graduate at the bottom of the class - they all ain't real smart. Merle

Yahoo! Finance User
Yahoo! Finance User - Thursday February 28, 2008 03:15PM EST

It's not about opinions being right or wrong. It's about LYING, CHEATING, MISREPRESENTING, MANIPULATING, DEVALUING, CONNIVING, STEALING, RUINING COMPANIES, RUINING INVESTORS, etc. SAVITZ CRAMER HOFFMAN BLODGETT MORITZ TONI S. They must be stopped.

Adam
Adam - Thursday February 28, 2008 05:02PM EST

These guys are right about the high emotionalism from Apple users. I work on Windows PCs and APPLE PCs. Both serve their purposes for what I need them for. But I've never heard such snobbery from any field of tech than I have heard from Apple users. However, these guys should not call what Apple users say "hate speech." That term "hate speech" is over used way too much these days. I've never heard hate speech come from an Apple owner. I've heard snobby / haughty taughty sacrasm and anger. But hate speech over board. Hate speech is what you hear at rallys against other ethnicities. It's not what you hear on the blogosphere (or read) :)

Eliakim
Eliakim - Thursday February 28, 2008 05:19PM EST

These so-called sophisticated and supposedly intelligent writers about companies and finance are anything "but" that. It is truly amazing that they can continue writing wrong analysis and wrong prognostications and using wrong facts and slanting things the wrong way -- and yet, keep on doing so for another day (and on and on and on). I guess some businesses are good to be in, in that you never get called (or lose a job) for being wrong all the time. This is certainly a "golden opportunity" for such blatantly wrong writers. That's why I never depend on these kinds of guys to tell me what I can plainly see differently myself. Anyone with half-a-brain (and less) can do so much better than these kinds of guys. Just imagine what a normal person can do (not these kinds of morons that write this stuff) can do and figure out on their own. I don't know how they can go out in public and face real people and live real lives with such terrible analysis that they do. They should go and hide in corners and in basements and stay behind their keyboards so no one can see them or talk to them.

recession08
recession08 - Thursday February 28, 2008 06:36PM EST

Henry blodget trying to play the righteous analyst is laughable. Eric savitch wrote an article that was based on opinion with no facts to back it up. The appl coo confirmed things are going very well. What is the next negative propaganda analysts will use too steal your shares? They are doing the same crap too goog. I guess analysts like solar stocks with no earnings and 80 times revenues.

Kevin
Kevin - Thursday February 28, 2008 07:33PM EST

Apple fanboys are hooting and hollering again. There might be another nice opportunity to short this sucker again. Amazing how stupid they are about investing.

AD B
AD B - Thursday February 28, 2008 10:23PM EST

Good commentary entails taking information, not knowing what it might mean ulitmately, and providing possible reasons or explanations to the readers. Often, especially lately, a tidbit of information is taken and characterized in ways that are predominantly anti-Apple. After reading the quote or information myself, I clearly saw other possible scenarios, positive and netural, besides just dire. Extraploating on bits of information is not the type of news that I find worthy. And if it must be done, I really wish it would be made clear what is being attempted, and as shared earlier, the provision of a fair analysis as to what this might mean to the company. Someone earlier said "...and APPLE will not make its goal (re iPod #'s)". What is Apple's goal re iPod numbers? Don't bother looking.... they don't, at least nothing shared publicly. Apple only gave a 10M figure for the iPhone this year, and that is rare for them to do. Speaking of which, Apple sold 4M in 6 months, in only 4 countries, 3 of those for just the last couple of months, not the full 6... It's just mind-boggling how some writers assert that 10M is a stretch with even more countries coming on-board and upgraded iPhones due soon. Assumptions were made about iPods and iPhones, negative ones, and they now have explanations that could have easily been provided as well, but were not. As an investor,and not only of AAPL, if I only hear one possibility while I can clearly see others, I lose all faith in the story and I'm left wondering if there is an agenda, especially if it happens repeatedly...

Matthew H
Matthew H - Thursday February 28, 2008 11:55PM EST

This is *exactly* the type of thing that led to ENRON. A company just tells the news that everyone wants to hear, invents profits that they may not see for years (if ever), and then let the analysts make a fortune by blowing smoke up investors' rear ends. On the other hand you have Apple which has a rock solid product line, leadership, and strategy. Apple *underpromises* and *overdelivers* which, as an investor is exactly what you want. If Apple says a nickel a share you might get 7 or 8 cents, but you will *at least* get a nickel. Isn't that they way companies are supposed to act? Not if you rise and fall on the sort of completely bogus speculation that drove ENRON.

Mo K
Mo K - Friday February 29, 2008 02:10AM EST

idiots analyst allple is on fire, I work at a hotel .... Even the dishwasher has an iPhone

Henry
Henry - Friday February 29, 2008 04:04PM EST

Remember that this speculation originated from...where are all the unactivated iPhones....well did we ever really get a plausible answer to that? I for one, think not. I work in the IT field (very high level I might add) and I know of exactly zero engineers that own one of these gadgets. Lots of other smart phones, blackberries etc, but no iPhones. So, Mo K, you may be right, it may be the dishwashers and waiters buyin them up...kinda like sports figure shoes and baggy pants? Is that the demographic, perhaps it is. I have always had a sneaking suspicion that the iPhones are sitting unused and unsold....purchased by a certain principle of AAPL...to meet the target...we are talking ego here gentlemen...this stuff happens. Yes, apple is otherwise a wonderful company with wonderful products, but you dont always win every poker hand...now do you?

Denis R
Denis R - Friday February 29, 2008 04:23PM EST

"I don't support apple products" thats a take off on the cult propaganda line...

Chris
Chris - Friday February 29, 2008 06:47PM EST

Words like "zealots", "cult", "fanboys" is supposed to elicit rational discussion, right? Instead of resorting schoolyard putdowns, try to answer the fact that most of the aapl critics lie, manipulate, rumormonger, and engage in wishful thinking. Examples are plentiful, and have been provided. The Microshaft Mediocrity Cult, Media Division in action. Yawn....

Yahoo! Finance User
Yahoo! Finance User - Saturday March 01, 2008 11:21AM EST

The Apple critics are outright mendacious and engaging in, like Eric Savitz, behavior that would draw SEC scrutiny in a better world. These two mealy-mouthed mollycoddler's are acting as if it's merely an honest disagreement over different interpretations of basic truths. A close listening begins to show you how sociopathic and, possibly delusional, these people really are. I come away concluding, it's not a stretch to see Blodgett as as sycophant with no true concern for his clients, or his brokerage for that matter. And they call us Zealots! I come away concluding, it's not a stretch to see Blodgett as as sycophant with no true concern for his clients, or his brokerage for that matter. And they call us Zealots!

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