Knocking around here again :)

This is crucial re AAPL:

"Agree. AAPL is one of the cheapest stock at the top of food chain. Sep-08 FY EPS consensus = $5.14, Sep-09 FY EPS = $6.42."

The thing is, no analyst is including the tsunami of revenue sharing due from iPhone sales and partnerships, which is accruing at a monster rate (currently $1.2 Billion) the earnings from which are amortised out over a period of 24 months on a subscription account scheme.

Apple has the equivalent of an additional 25c earnings in free cash flow, which had it been taken into account would have resulted in Q1 earnings of $2.01 instead of $1.76.

Next quarter, the contribution from this amortised revenue is due to be approx 35c. If you add this in to LAST year's Q2 earnings of 87c, that would already take you to $1.22 EPS - in stark contrast with Apple's guidance of 94c and street expectations of $1.09. AND THAT ASSUMES ZERO ADDITIONAL REVENUES FROM INCREASED iPod, iTunes, and Mac sales, which should add another 20c in earnings combined.

So for Q2 - for which Apple guided for 94c, they should be able to deliver $1.42 as a minimum.

Apple did a typically über-consverative guidance for Q2, and the stock was train-wrecked by the lynch mob as a result. Apple will earn between $6 - $6.50 this year rather than $5, and approximately $9 in FY09 again the $6.42 expected.

That's why its dirt cheap here: analysts haven't done the maths, and the Street can't add up for itself. Had Apple guided realistically instead, the stock would have been closer to $200 today instead of hitting a low of $126.

Knowing this gives you the power and confidence to invest. AAPL is cheaper at $126 relative to its growth than at almost anytime in the last 5 years.

Low PEG, good turnaround story, appointment of a CFO, some interesting new products announced in the last few months so far without and big takers but with obvious potential, increasing demand for hard drives as consumers latch on to the notion of having home servers/backup devices, and the increasing profitablity of the XScale division with its move to TSC... amongst others :)

.. and wondering whether to buy some MRVL... I've been out apart from a quick trade since about $17.

Buying the lows, that's what I'm doing :)

Forward PE:19
Earnings Growth: 40%+

How can you not buy that?

Apple management did exactly the same thing this quarter last year - beat estimates for Q1 by a mile, issued incredibly poor guidance for their Q2, beat by 54% when they reported. They'll do the same thing this year.

As for MRVL (back to the topic, whatever we may disagree on WRT to AAPL) I am sorely tempted to get back in here... at 13.50-ish its pretty tempting. If only the company's management wasn't so damned difficult to pin down and didn't have a reputation (misguided or otherwise) of being Enron-esque.

Whilst guys like you and Fred Hickey still nay say AAPL, I know there's plenty of people who aren't in the stock or are still short it.. room to run higher in other words ;)

Like I keep saying, you can't nay-say 60-70% YoY earnings growth when its visible two years+ out. In addition, you seem to ignore the fact that AAPL has already had two major corrections of 30%+ in the last 6 months thanks to the market mistakenly thinking that Apple has a mortgage business (anyone heard of the iHome?) and has still managed to recover and run higher.

In fact, the stock continually whipsaws out the weak hands, but until the company itself stops growing earnings at 2-3x the rate the Street expects, the stock isn't going to do anything other than trend upwards (broader market permitting it goes without saying) even whilst undergoing painful (for margin'd players) corrections along the way.

You really need to understand iTunes, iPhone sales deferred revenue, subscriber revenue sharing, and Mac sales growth to get AAPL. Unless you're prepared to do the math on this you'll (somewhat reasonably) see the stock as overvalued because you simply won't understand what is driving earnings growth nor comprehend why that growth is going to continue unabated at current eye-popping levels for the next couple of years at a minimum.

When are you going to stop going on about AAPL GOOG and RIMM? These are earnings growth monsters. I grossly dislike RIMM and I think GOOG is a bit of a one trick pony, but short them? Lol! Welcome to an early grave.

As for AAPL, with accelerating earnings growth and up to $5 Billion in deferred revenues due to be booked in 2008 (and not in analysts' public models), AAPL is set to deliver 50-75% earnings growth in 2008 and similar for 2009, irrespective of any recession.

Its simple math.

Seriously, you need to shape up your ideas on these large cap mega-growth stocks. Earnings growth is earnings growth. When you can look at a company and see 60-70% earnings growth year-on-year for the next 2 years at a minimum virtually guaranteed then you would be crazy only for not holding a stock. Its hard to put a premium on that kind of visibility, which is why people are paying up for it.

AAPL is cheap under $225 right now and could be pushing $450 in a few years, whether it sucks back to $150 short-term again or not.. betting against it and trying to time shorts on it has been a losing bet for the last 5 years. Only during the options backdating bullshit did the hyperventilating shorts manage to get any serious traction. Every pullback before or after that 5-month journey to hell and back has been very, very short-lived.

Yep I agree - if that downtrend gets busted to the upside, I've plenty of time to jump back in for a trade up to $17 :)

<<<Extremely bearish? But what's the downside? As you put as the reason when you bought yesterday, actually, not much.I am underwater for the buy yesterday, but it should be back in a few days. So far, no sign to break the 14.5. >>
Agreed. But when MRVL couldn't make or hold any gains on the back of TXN's update I decided the stock might be dead for a bit and have decided to deploy the cash elsewhere for now. I won't get back in unless it hits $14.50-ish, or recovers $15.25 and stays there after the downtrend has crossed beneath it.

<<<All it's doing is a clear test of the resistance at $15.25 which just happens to also be the level of the downtrend line (look above) and will fall back along that downtrend, then jam up through it. >>>
I agree with your technical take, but I am not convinced it will get back over the downtrend, which as its crossing the key 15.25 level now would be extremely bearish short-term and encourage heavy short-side trading going into expiration next week, considering where the Max Pain level is.

I just sold my buy from yesterday for a small loss of a few cents. Waste of time for now. Will wait until after expirations before looking at this again. I have to say that I smell more capitulation in the air here than I can almost ever remember. Everyone seems to have given the stock up for dead.

Its still on my watch list.

What a pig! Chips up, MRVL in the shitter again. I'm in this for a bit of a contrarian play. MRVL is like a sheet of bubble-wrap - traders can't resist popping all the bubbles - but eventually they'll all be burst, and then these guys will move on to the next victim. If MRVL can't collapse under $15 and stay there, its bottomed. My risk is minimal as my buy price is so low; I don't care if it drops from here because I'll be out for a minor loss, but I still think there's incredible potential in this stock should the wind get behind it.

<<Personally, I think the AAPL/MRVL association is becoming rather murky. aapl can create winners and losers and that can happen quickly.>>
You're so right there. Apple has no loyalty to suppliers whatsoever and squeezes margins dry. Personally I don't think MRVL can afford to lose Apple as a customer. The potential with the iPod touch (30M/year) and future wireless versions of the iPod, and the iPhone going mass-market, are just too huge to consider the risk of losing. Management have to do whatever it takes to keep Apple as a customer.

About private messages... thanks for those who messaged me with commentary and/or advice, but as I'm not a paid-up subscriber here I can't seem to reply to you - don't think I was being rude and ignoring you, please :)

I just bought 10k MRVL for a trade at 15.29 with a stop about 2.5% lower.. seems like a no brainer risk/reward setup. I got out in the $18s after running up from the last low in the $15s (for the second time), so this is like getting a third bite at the cherry... minimal downside, lots of upside.

YoY earnings growth = 40%+ give or take 10% and will continue for the next 2-3 years at this pace - double what is being forecast by anal-ysts on Wall Street. AAPL will have hiccups along the way (it does every year) but its pps is going to continue to gorw while the underlying company continues to expands its business at this rate.

Nay sayers have predicted the demise of earnings growth for AAPL for years. They're wrong, because they haven't done the maths. Earnings will have doubled by 2009.

As for MSFT and INTC, so what? They lost their growth story (as did DELL) many years ago. You stick to your bear market thesis, and I'll stick to my spreadsheet models :)

Last Hurrah for AAPL? You jest :D

AAPL's going to $350 for 2010. Plain and clear without any insane PE or valuation necessary, just on Mac and iPhone numbers.

Unless there's not just a recession but a fully-blown depression.

Mark my words :)

AAPL's going to $220 in January

AAPL at $194.69, new all-time high. Any more nay-sayers want to come out and call a top again?

MRVL will be a big beneficiary of Apple's new plans if they come to fruition. Market hasn't considered the idea of an iTablet possibly not using an Intel chip but an ARM instead..MRVL has the perfect solution, of course...

Lol.. funny how this "leak" of an old Photoshop mock-up that is definitely not a picture of whatever RIM are designing comes out with this "new" spec the day RIMM gets busted by Piper Jaffray and falls 7%.

It may come out in Feb, March or April.. or June.. whatever .. its not out yet, its not announced, and BGR have no new info of any note :)

This was a RIMM-pumping exercise of the old-skool in an attempt to put a floor under the sell-off.

I'm sure RIMM will come out with a touchscreen phone (after rubbishing the idea of a touch-screen phone... lol) in their own time, but this "news" is just a desperate attempt to pump the stock back up, for now. Seen it before, many times.

Don't forget, this isn't really news. Jobs said in October he expected to offer a 3G iPhone "late next year."

Stock at 14.75 now.

Summary of CC

17:51 MRVL Marvell Conference Call Summary (16.60 +0.61) -Update-

In Q4 expect storage sales to improve over Q3 as a result of continuing customer demand and consumer electronic seasonality; in addition to strong PC sales, this continuing demand is caused partially by the proliferation of hard drives in to non-traditional application such as PVR security, DVD recorders, external storage for attachment to all kinds of devices... we expect continuing growth in ethernet infrastructure, and connectivity business segments.... expect wireless business to be relatively flat... expect gross margin percentage to improve 40 basis points over Q3; expect to see gross margins of 50% by the second half of FY '09.... expect pro forma operating expenses in Q4, to remain ~ at Q3 levels when normalized for an extra week... expect expenses to grow at a rate below rate of revenue growth for fiscal '09... Gross margins is something that have become a central focus of the company; have made a very determined effort to improve gross margins by looking at operational efficiencies... in terms of the operating expenses, right now it's a little too early for co to give an indication of whether they could take the number for Q4 and reduce it by $10 million to come up with the expenses of Q1; 'I'm not prepared to make any comment on that at this point'... In Q3, co had extremely good linearity; shipments in the first two months of the quarter were much greater than general; as they go in to Q4 backlog was strong... In response to GPS question: 'this is an area that we also looking at, and it's too early for us to talk about the GPS at this point, and we have something to talk about, and we'll talk about it later'...

This stock is in the shitter again following a CEO who can't speak properly taking the CC. This guy is toxic for analysts. Totally toxic.

At 15.50 I am buying, with a guaranteed stop in 5% lower ( I can do that trading CFDs - if there's a gap-down open lower tomorrow morning than that then I will be out for my guaranteed price of some 75c lower, should the stock go into the $14s.

I sold out of MRVL around $18 during the last rally, so getting back in 20% lower seems like a worthwhile risk/rewards, considering my guaranteed stop safety net..

They rise because earnings rise.

hard to argue with growth stories delivering 40-60% YoY growth year after year, that benefit from a weak Dollar, which sell into international markets and are taking market share from their competitors hand over fist.

The best companies on the planet. I loath RIM but hell, they sell a lot of Blackberries.

Marvell slashes 100-200 jobs

13:57 EDT MRVL Marvell Technology Group expected to announce Israeli restructuring-Globes
According to sources, Marvell Technology Group (MRVL) is expected to announce a restructuring of its operations in Israel that could lead to a loss of 100-200 jobs. Reference Link

Oh do shut up :)

Earnings earnings earnings. That's all I have to say. WTF is the point in buying any stock if you think the economy is going to collapse? In that case we're all fucked.

In the meantime, I'll take AAPL GOOG and RIMM over all others because they are growing earnings by 60%+ YoY every year. You want to buy PG and KO? Be my guest. I'll buy and hold the real winners.

If there's no broader market melt-down then I expect to see AAPL benefit from incredible earnings growth strength, of around 40-60% in 2008 whereas the Street only expects 20%.

This will lead to AAPL running up to $250 by Spring/Summer and $300 by 09.

Broader market permitting, of course.

Christ get a grip.. these stocks are rising because their earnings are growing 60%+ YoY. What the hell do you expect.. their stock to fall while their earnings are growing gangbusters?

They'll fall hard if their earnings growth falls hard. Otherwise they'll carry on ramping, and the weaker the Dollar gets, the better for AAPL and RIMM as they earn an increasing amount overseas.

Stop obsessing over why they should fall, and wake up to why they're going up. The financials are irrelevant. There's plenty of money out there, and credit quality outside of subprime is strong.

I think you should check back a few days or weeks and see some of the scorn heaped on me by S2 for suggesting AAPL was going to run higher (when it was at $160!) and wasn't a good short even back then. I wasn't rude or obnoxious, but I was loud about my objections to anyone considering an AAPL short because I knew it would be ruinous to them and didn't want people who had obviously lost a lot of money on MRVL (which I also trade a fair bit) losing money on an AAPL short.

I'm sorry if that ruffled feathers, but S2 was so adamant about it, and so scornful of my views, that I initially said I wouldn't bother posting any more and went back to just lurking as I'd done for awhile. It was only when S2 began - yet again - saying what a fantastic short AAPL was going into earnings yesterday that I felt compelled to speak up, because I knew the results were going to be a blow-out and didn't want to see people lose their arses shorting one of the most powerful earnings reports of this season.

I didn't come here to stir up dissent, but neither can I keep quiet when I see advice being given which I know for a fact could lose people a small fortune. S2 may be a great trader, but even the good guys get it horribly wrong sometimes (me on SNDK, October 2006 - ouch!) and this was one of those times.

Thanks for your kinds words re: the board though. I hope you'll feel welcome there anytime. Its a good community and there are many people on it who have made fortunes large and small trading AAPL and sharing a gold mine of information, DD and number crunching.

Indeed! RIMM were very dismissive of touch screens, as were Nokia. Now both are developing them. Funny :)

Apple's numbers are great for MRVL, but much overlooked is the impact of the iPod touch. I estimate Apple will sell about 10M of these (out of a total of 30M iPods) this Christmas quarter, all of which have MRVL WiFi chips in them. If MRVL can keep the iPhone/iPod touch socket throughout 2008 then between those two models, MRVL should be selling around 35-40M WiFi chips to Apple during FY08.

Anyone care to work out what that means for MRVL? Is it significant? I don't know the numbers well enough but was under the impression these sell for about $5. Is that right?

No need to get all pissy. But when you start telling people to short AAPL into earnings because its going to miss, you should be able to justify why, and not behave like a brat when someone calls you out on it with derisory comments about how pathetic they are and how successful you are in comparison.

Lo and behond, AAPL beat hugely and is up massively in AH trading, and will continue to $250+ by next summer in all likelihood.

And you want people to short it? Good grief.. what are you trying to do - bankrupt small investors and traders by the score?

I've news for you buddy; AAPL is up 2500% in the last few years, not 300%. Two thousand five hundred percent. Go on, go and do the maths, if you can. I don't give a damn what you think of me or anyone else, but if I hear you recommending to people that they short a stock which I know will likely ruin them if the follow your advice, I'm damn well going to tell them not to do it and why.

If you find people "annoying" when they tell you you're wrong, and can't explain why you're right, then perhaps you should have a hard think about your state of mind rather than taking out your dissatisfaction over MRVL on others. Your MRVL posts used to be insightful and interesting, but I'm afraid that these days all you seem to do is pour scorn and loathing on any other stock except for your pet favourites in a pointless display of envy and stubbornness.

Shame. And shame on you for losing sight of what matters.

"I gotta tell ya'll, I think AAPL is a big ol' short going into tomorrow's report. "

AAPL at $188, up $14 AH after a blow out report. Yeah, how's that AAPL short doing for you? Good lord... some people never learn.

Good luck with TXN. I'm sticking to MRVL.

AAPL is heading to $350 for 2009.

Told ya.. AAPL is the daddy

They're going to deliver $2 for Q1 08.. guaranteed. AAPL is going to $200 by January, $250-275 by summer 08.

I'm hoping for a pullback on a misunderstanding of AAPL's guidance due to their new approach of amortising revenue for an increasing number of their products,.

I know they'll blow out this quarter, as they always do but guidance could stink not because of any issue with sales but because they may decide to amortise revs/earnings of the new, best-selling iPod touch over 24 months, which would knock 30-40c off guidance for the next quarter (even though the real net impact on Apple is zero, of course).

That would let me scoop up cheap AAPL before the Street realises its mistake :D

Thanks for the good wishes tho.

You really are a lost cause. AAPL guided for 65c this quarter, and the Street is expecting 82c.

They're going to deliver $1.05 - 1.10.

Guidance as ever will be totally low-balled, which is par for the course with AAPL. Last Q1 07 (ie Oct - Dec 06) they guided for 65c and delivered $1.21.

And that's all I'll say on the matter.

You know, I came here for insight into MRVL and have ended up getting frustrated at the total pig ignorance of some posters here with regard to Apple, RIMM and other customers of MRVL that you attack in order to blow of steam and frustration at MRVL not performing.

I think I'll spare you all the grief of reading my AAPL rebuttals and just lurk in the background. Much of the MRVL info here is invaluable (thanks Lakers, and some of S2's analysis rather than his rants) but otherwise the commentary seems to revolve around attacking the market-leading stocks and companies and getting angry at MRVL's lack of ability to get off the ground.

Hasta la vista boys. I'll just read from now on. Have fun talking amongst yourselves, and apologies to anyone who feels unfairly criticised by this post - its not aimed at you.

JB, after that post I've just realised you have no idea what you're talking about, so forgive me for not bothering to reply to any more of your AAPL posts :)