05-07-2012, 07:54 PM
He sounds like someone who needs to come up out of the books to get some air.
The big factors are the ones that I think are harder to put a number on and harder to predict and he didn't bring up any of them.
Apple's future, to my eye, always looks suspect. They're a company that could go into the shitter next year or they could continue to grow hand over fist for the next 50 years. They have an extremely popular but very narrow product lineup that's highly subject to the fickle wants of the public. They aren't diversifying. They aren't selling stuff that's largely independent of the fickle public, like big backend servers. Their tight controls limit the possible applications of their products. They're kinda like Facebook or Myspace, in a way: big success could turn into a vanishing act in the course of about a month.
Really, I think the best thing about Apple as a company, from an investor standpoint, is their staggering profit margins. What makes me nervous is that they aren't using that enormous profit margin to grow or diversify.
Whereas Amazon is a company that's hard to envision collapsing. They're slowly killing everyone. They're diversifying in slow but smart ways, some of which could potentially be bigger than retail one day. And while retailers benefit from customer loyalty, ultimately people will go where the deals are as long as the rest isn't too messed up, and Amazon as a retailer does a lot of things right.
Amazon's P/E is a bit ridiculous and I always pull back when they cross $200 but investors still love them, so it's hard to say where to draw the line. I mean I draw it at $200 but here they are at $225. I could'a made a fair margin more by holding out! I can only imagine that investors see Bezos as someone with good vision for the future who's taking Amazon in a good direction while Apple's leadership and future are seen as unknowns.
That's why I think Apple continues to be a lagger on the market while Amazon's stock continues to plow straight through what the numbers suggest it should be at.
Or maybe to put it another way, I see AAPL as high risk, potential high reward while AMZN I see as low risk, modest reward.
I do think Apple could sail into space if they come out with The Next Big Thing. The problem is if they don't, they may turn into MySpace.
The big factors are the ones that I think are harder to put a number on and harder to predict and he didn't bring up any of them.
Apple's future, to my eye, always looks suspect. They're a company that could go into the shitter next year or they could continue to grow hand over fist for the next 50 years. They have an extremely popular but very narrow product lineup that's highly subject to the fickle wants of the public. They aren't diversifying. They aren't selling stuff that's largely independent of the fickle public, like big backend servers. Their tight controls limit the possible applications of their products. They're kinda like Facebook or Myspace, in a way: big success could turn into a vanishing act in the course of about a month.
Really, I think the best thing about Apple as a company, from an investor standpoint, is their staggering profit margins. What makes me nervous is that they aren't using that enormous profit margin to grow or diversify.
Whereas Amazon is a company that's hard to envision collapsing. They're slowly killing everyone. They're diversifying in slow but smart ways, some of which could potentially be bigger than retail one day. And while retailers benefit from customer loyalty, ultimately people will go where the deals are as long as the rest isn't too messed up, and Amazon as a retailer does a lot of things right.
Amazon's P/E is a bit ridiculous and I always pull back when they cross $200 but investors still love them, so it's hard to say where to draw the line. I mean I draw it at $200 but here they are at $225. I could'a made a fair margin more by holding out! I can only imagine that investors see Bezos as someone with good vision for the future who's taking Amazon in a good direction while Apple's leadership and future are seen as unknowns.
That's why I think Apple continues to be a lagger on the market while Amazon's stock continues to plow straight through what the numbers suggest it should be at.
Or maybe to put it another way, I see AAPL as high risk, potential high reward while AMZN I see as low risk, modest reward.
I do think Apple could sail into space if they come out with The Next Big Thing. The problem is if they don't, they may turn into MySpace.