Quote:
Originally Posted by BayMoWe335
It’s trading at that multiple based on 2019 estimates, so it is a look forward. Apple makes 3X the profit of Microsoft and Google and has a similar market cap. Apple is dirt cheap by any measure and the discounted multiple is based on it being a “hardware” company, but that is changing with a $40B services business growing at 25%.
There is no real data showing consumers are “resisting” higher priced iPhones. Every article on that is speculation. The quarter Apple just put up shows people are buying iPhones for much higher ASPs than before, with no loss in unit sales.
Apple sold 218M iPhones in 2018 at $760 each and 217M in 2017 at $650 each. Pricing power in real numbers.
If Apple puts up a disappointing quarter in Christmas and the real data shows a revenue drop, ill start changing my thought process. Fake stores around iPhone demand are normal during this year, designed to manipulate the stock and are always proven false in the real data. Same thing was said about iPhone X last year and iPhone 7 prior to that. Apple always delivers the earnings, period.
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Looks like you've been following the stock more than I do. One thing that bothers people is AAPL will stop reporting quarterly unit sales and only reporting the revenue data. People interpret this as there could be an issue with the growth of iphone sales.
Also, 218M vs. 217M unit year over year (I assume since the data came from you) does not seem like an impressive growth number for me although the higher per unit cost does offset the small gain in total unit sales. One can interpret this data as in order for AAPL to growth in iphone revenue, since the unit sales growth won't be there, AAPL has to charge more per unit but this can be only so much since consumers will not be willing to pay a higher cost for a smart phone.