Apple skeeves me. Kind of like that feeling you get when you meet that guy in the office who's been there for ages, performs great for the company and is generally likable, but for you he just gives you this weird vibe.
I've done a lot of due diligence on this company. There's nothing about them that strikes me as unethical, much less illegal. They're a FANTASTIC company through and through. The part that gets me is this.
Their numbers just DON'T match up with their price. For the price of Apple's Market Cap right now, you could buy over a dozen equally good (albeit smaller) companies with growth prospects as good (or better) than Apple on a YoY basis.
The iPad is nothing compared to what the iPhone was. Sure it will bring in increased revenue for Apple... but realistically, how much? Enough to increase their net income another 230% in 2 years? I think not. Not even close.
Unless their 10-K for 2010 lists a net income on the order of $15 billion with significant growth prospects, there's no way any reasonable person could consider $260/share a reasonable price.
Now the prospects *are* there. iPad sales, app sales (new apps specifically for the iPad) book sales. It's all there. If there were no competition.
Here's the rub. There aren't many companies who can compete with the iPhone. In my opinion (for years) only one, Google, has been capable. And not too long ago (Presumably after being sleighted by Apple's refusal to carry their app) they stepped into the ring. And now they're coming out on top. This is NOT a small thing. Google has proven time and again that whatever someone else can do, they can either: A) Do it better (Search engine), B) Make it free and profit from advertising (EVERYTHING they do) or C) Buy them out (Youtube).
Now I'm not saying Google is sure to be successful here. Steve Jobs is a hell of a CEO. Nor am I here to say that Apple is a bad investment overall. I love the company, the officers and the products. They're a great company. What I hate right now is the people trading this stock.
What I *AM* saying is that Google has as much (if not more) innovation at the Googleplex than they have over at 1 Infinite Loop. They can (and ARE) cutting into Apple's market share, which can (and WILL) cut into Apple's bottom line.
In short, in my opinion, Apple is a bad investment at 260. A more reasonable price would be about $220/share. That's a price more befitting a company with growth prospects similar to Apple's. Anything over $220/230 right now is, imo, a bubble waiting to be popped by a ho-hum earnings report.
