Apple Door Crasher Data Seriously Flawed; Addiction Behaviour = Risk $AAPL, $GOOG, $BBRY, $MSFT

Apple (Nasdaq: AAPL) released new iPhones in 11 critical markets. Preliminary data indicates the expensive model is selling very well. Early adopters are driving this demand. People line up for days on end ahead of time sleeping on side walks if need be to be among the first to buy the phone. Not sure why Apple doesn’t auction them off to highest bidder and leverage the insane demand. Maybe donate money to charity or something good like that.

Do not be suckered by the addiction mentality of early adopters. Demand is a long-term equation not a one day door crasher sale. A buy or sell decision on one day data is foolish and incomplete.

A correct fundamental analysis would concentrate on how the product is being extended and if it fights off Android. Battles are fought not on one bullet. All generals know to prevail you need mass on the battle field. Speaking of which Microsoft (Nasdaq: MSFT) Nokia and Blackberry (Nasdaq: BBRY)

George Gutowski writes from a caveat emptor perspective. Follow him on Twitter @financialskepti

Microsoft Candy is Dandy but Sex Wouldn’t Rot You Teeth $MSFT $GOOG $AAPL $YHOO

Microsoft (Nasdaq: MSFT) announces dividend increases and share buy backs. As previously predicted the Financial Skeptic called for dividend increases and share buy backs just to keep investor enthusiasm err engagement err addiction up there.

The move is essentially a “Candy is Dandy but Sex Wouldn’t Rot your Teeth” gambit. By increasing the dividend you more deeply engage income investors and protect the floor. By purchasing shares you enhance the financial engineering. but this is all Dandy Candy.

The real sex will come when the new sovereign is found and proclaimed. There will be a magnificent royal procession allowing the subjects to see the new king and proclaim allegiance. Hopefully the sex will not rot our teeth.

It’s all about Steve Ballmer’s replacement. Until we know and have confidence there is a Black Swan Co-relation which causes the market to shiver unexpectedly.

George Gutowski writes from a caveat emptor perspective. He does not like shivering unexpectedly. Follow him on Twitter @financialskepti

Microsoft/Nokia Will Screw Over Apple and Android $MSFT $GOOG $AAPL $NOK

Microsoft (Nasdaq:MSFT) in a controversial move has acquired Nokia (NYSE:NOK). Not sure if this is to secure a tenuous toehold in mobile devices using Windows or is it a way to source a new CEO. For $7.2 billion it better be to work the Windows toe hold, because you can get lots of excellent CEO’s for less than $7.2 Billion.

The acquisition comes lockstep with Ballmer’s retirement announcement so there must be a plan. Microsoft is solving Nokia’s capital shortage problem. Microsoft is relying on Nokia old Mojo coming back. Maybe they got it and maybe they don’t. Stand by for product announcements and see what they roll out.

Microsoft and Nokia were first movers and disrupters. They clawed out a strong market share and went to sleep comfortable in the status as world-class dominator. They weren’t watching and competitors started to eat their lunch. Nokia missed a few turns on the road and found themselves in the ditch.

The major flaw that everyone keeps shrieking about will be the lack of apps for a Windows-based product. Some claim developers are too beleaguered trying to cope with Apple and Android applications. This is wrong. Developers will go where the money is. Microsoft has $61 Billion in cash and growing.

Here is how Microsoft will need to throw their money around to develop the right set of trends.

  1. Bonus developers for creating Windows Driven Apps. Most will develop apps if the Windows Smartphone develops more traction.
  2. Develop apps exclusive to Windows which will drive sales of Windows Smartphones and cause some abandonment of Apple and Android. Microsoft is still strong in enterprise applications. There’s lots of stuff that is App ready which should be exploited quickly.
  3. Enterprise apps will drive multiple unit sales. Not the ones and twos at retail kiosks. Microsoft is not dry of app ideas just unexploited.

The exclusivity will the way Microsoft/Nokia screw with Apple and Android.  Watch for lawsuits. but in the ensuing years market positions will be established.

George Gutowski writes from a caveat emptor perspective.

 

 

Googles Californication Episode plays into a Chinese Gambit. Read How $GOOG $YHOO $MSFT $AAPL #Xiamoi

Google (Nasdaq:GOOG) has a high level love triangle which shows how Sergey Brin is losing focus. Sergey having a bad case of seven-year itch has become bored with Anne Wojcicki and has separated. He keeps most of the money due to clever pre-nup.

Sergey is now romantically involved with a women who was previously involved with Hugo Barra a key Android executive. Hugo is leaving for a fast expanding Chinese telephone company called “Xiamoi” which competes with Motorola in the Android space.

Sergey and Google if you recall have had their problems in the Chinese market incurring the wrath of Beijing and being marginalized. Knowing how the Chinese operate someone in Beijing signed off on Hugo Barra; most likely knowing they are taking a key Google brain and turning another gun against Google.

Will this be the demise of Google? Unlikely the game is too big. What is does say about Sergey Brin is most important. Sergey has two children after a six-year marriage. He exercises the droit de seigneur and becomes involved in an affair with a women who was involved with one of his key executives.

Come on buddy. What were you thinking at all those executive presentations. Complicating the issue is Anne Wojcicki’s sister is a Google vice president for advertising. The sister originally rented her garage to the Google founders in the very early days. But surely to God those debts must have been paid in full by now. Is there some sentimental issue involved.

If it wasn’t for the fact Sergey Brin is a founder and major shareholder this would not be important. In other companies executives would have been asked to leave or be re-assigned.

At Google they are still fumbling with China and playing a Californication dating game. the executive suite is beginning to look like a corrupt European court. Oh well let them eat cake.

Xiamoi means little rice in mandarin. Three years old and privately owned Xiamoi may be the next big contender. So who-ever the ex-girlfriend is she doesn’t get market potential concepts.

George Gutowski writes from a caveat emptor perspective. Follow him on Twitter @financialskepti

Apple Investors and Heroin Addicts. Whats the Difference? $AAPL

Investors interested in Apple (Nasdaq:AAPL) are seeing a behavioural economic clash. Traditionally Apple has titillated the markets with stunning announcements. New and very sexy products. Increasing market share. Wildly increasing cash balances. Apple mentions in media were at orgasmically high rates. Frenzy frenzy frenzy. Normally associated with smaller names but this was Apple. Safety oriented pension plans were big investors.

Investors were hooked on the frenetic energy of constantly improving news which made the metrics look damn fine. Investors became anchored: emotionally, psychologically, addictively to the feed back loop. Buy more because more good news is coming. You’ll see.

Apple is a highly successful business not a perpetual money-making machine. Competition found its feet. Unsustainable metrics collapsed. The huge cash position is now being used to woo back the investor with dividends, huge share buy backs sometimes financed by debt (which currently is cheap)

But when you analyze the media and investment commentary there is one common unifying theme. It is the lament of a heavy drug user who is finding the drug losing its potency. Traders relying on a long Apple short something else now have to think for a living. Some seem to be incapable of thinking.

Apple has dropped obviously. They still have enormous cash positions and enormous abilities to raise debt at very cheap levels. The products while facing more competition are still in high demand. The applications eco-system is still enormously tilted in favour of Apple.

Apple is considered the new Sony. Sony never had the enormous cash position that Apple enjoys. Apple has not lost its ability to innovate. It does have more effective competition.

Apple does have one enormous advantage over Google and Android driven offerings. They have not pissed off the Chinese with search engine politics. The Chinese market is huge. Even if it does slow down it will still be huge. Samsung will always be treated with suspicion in China. Apple is the only entity which can bridge the cultural divide and create shareholders wealth.

Apple is relying on financial engineering for now. Investors are being enticed with dividend yield and share buy backs. Hard core Apple investors   traders do not understand how to deal with a dividend stock. The dividend stabilizes and allows you to become patient. Get paid while you wait.

Heroin addicts looking for the next rush are not anchored in the same fashion. Therefore we will have a rotation within the shareholder base.

George Gutowski writes from a caveat emptor perspective.

Will Apple annoy #iPad users to fight off #Kindle #Tablet $AAPL $AMZN

Cover of "Kindle Wireless Reading Device,...

Cover via Amazon

Seems everyone has a special secret insight into the Kindle tablet from Amazon (Nasdaq:AMZN) and how it will kick Apple’s (Nasdaq:AAPL) iPad around the block. Pretty good publicity for an unlaunched product. The price point buzz is critical. Everyone assumes Kindle will come in way lower than Apple. Everyone says Amazon has huge cash reserves and will try to bleed Apple. Everyone knows Apple has lots of cash and can take some attrition warfare.

But look at it from an iPad users stand point. You lay out some serious cash and a compelling competitor rides onto the field. Apple drops its price to counter. How many iPad purchasers will be rebated and how angry do they have to become to get the rebate. What will this do to the iPad and Apple Brands

Once Kindle forces the price down who will win the upgrade war of new and wonderful features. Amazon and Kindle have a winning track record in the marketplace. Apple has dominated because it takes an early lead and does not lose it. Apple will see the lead shrink and it is not used to fist fight.

So will they annoy the iPad customer and drop prices once Kindle has some traction or will they strike pre-emptively and signal respect for Kindle Tablet. 

Disclosure: George Gutowski writes from a caveat emptor perspective. I am anxiously awaiting the Kindle tablet before I make my final personal decision. I do not own positions in stocks mentioned in this post. I do not have any plans to initiate any new positions within the next 72 hours.

iPhone malfunction what up Apple? Dust Bunnies killed you. $AAPL #iphone

I took this photo of my iPhone and its SIM slot.

Image via Wikipedia

This morning I wake up and my iPhone says I do not have a SIM card. I did not take it out and would not know how. I run down to the service kiosk at the local mall praying that the sunday staff are competent enough. Sure enough they take out the SIM and show me how to do it with a paper clip. Then they apply scotch tape to the SIM card figuring some dirt got in somehow. Three of four pieces of tape later, re-insert the SIM card and I have a functioning iPhone.

Steve Jobs of Apple (Nasdaq:AAPL) I came this close to going Android. I am this close to buying an iPad2 and you almost lost the deal because of a microscopic dust bunny. Steve come on for criss sakes that was a close one. A piece of scotch tape keeps your product going. Who would have thunk that one.

Disclosure: George Gutowski writes from a caveat emptor perspective. I do not hold positions in stocks mentioned in this post. I have no plans to initiate new positions within the next 72 hours. I get very anal retentive about personal digital devices (that’s almost wrong eh!) and I will probably get an iPad2 very soon.