Author Archive for markettamer

(Apple Earnings) * 2 = Facebook Valuation

Special thanks to Phil Davis for his contributions to this article.

Maybe a half trillion dollar market capitalization is the stumbling block, but it's sometimes hard to rationalize that Apple is truly valued at $508Bn today.

Delving into the details, some startling figures appear.

First, let's look to the widely cited metric of price-to-earnings. Apple has a forward P/E of just 11, which is by no means expensive.

In fact, digging into those earnings, we see a figure of $13,000,000,000. That's nine zeroes after the 13, and it's not a mistake, nor is it an annual figure. That's 13 billion dollars for a single quarter.

Now seasonality is a big factor in earnings but Apple is still projected to grow this year, which means the $45Bn EBITDA for the trailing twelve months should be substantially surpassed in the coming twelve months.

The story of Apple is not limited to Apple of course. It's massive market capitalization didn't just come from its own success, but also from cannibalizing competitors, most notably Research in Motion.

Remember when RIMM was valued over 6 times greater than what it is valued at today? That was just 24 months ago. $50Bn of valuation lost on RIMM. $50Bn of valuation gained by Apple.

Some might say the Apple story is ending. As iPod sales, the flagship product, just a few years ago dwindle, maybe the same will happen iPhones and iPads?

But wait.

iPod sales had just one connected recurring revenue stream: iTunes. The iPhone has more than iTunes; it has the addictive nature of cell phones in general which means the monthly charges Apple enjoys from the subscription service have greater lifetime value. And iPads don't necessarily cannibalize iPhones like iPhones cannibalized iPods. Statistics on iPad usage show a huge number of users rely on iPads for reading and game-playing at night while lying in bed, when phone usage is considerably lower.

And then there's Search. Siri is just the beginning of what Apple will do to fundamentally disrupt search. Each customer will be enabled with a virtual assistant through Siri. It's a game-changer in the world of search in years to come that Google is already threatened by.

And there's iCloud. The Dropbox founders didn't take the deal from Jobs to be bought out, and so Apple created iCloud, which is better. It's more than file-sharing and synchronizing. Imagine downloading a file…
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Can One Company Transform The Jobs Market?

The Bureau of Labor Statistics reported on April 1, 2011 that the unemployment rate was little changed at 8.8%. It is no secret that when factoring in underemployed and discouraged workers, the true unemployment rate is approximately twice the headline figure currently. Politicians will try to ignore the fact, media will try to sensationalize the fact, job-seekers will despise the fact, but one company might just be taking a pioneering and bold step by daring to improve labor market efficiency one person at a time.

A little-known company called SkillPages is threatening to become one of the most disruptive social media companies since Facebook. Facebook knitted the social fabric of the world by connecting individuals who share experiences. SkillPages is taking the concept of social connectivity a step further by transforming the way individuals with skills connect to individuals seeking skills. As an example of how SkillPages can improve labor market efficiency and put people back to work, think about the following example.
 
Imagine a plumber in your community who is unemployed. Now it is probably fair to say that somebody in the community needs a plumber but is unsure how to find a plumber on whom he can rely. LinkedIn wouldn’t really be the place to search because it’s tailored more for white collar professionals. Yelp or Yellow Pages might offer business listings but neither provide the trusted network on which you can have confidence in your hiring decision. SkillPages solves the problem of connecting the person with skills to the person needing those same skills in a trusted environment.
 
In so doing, SkillPages puts job-seekers back to work and creates value with each new connection that leads to a new job or employment opportunity. On a broad scale, the company has the potential to move the Unemployment Rate needle all by itself. Undoubtedly, a large number of unemployed job-seekers have skills that are needed by customers and employers in their communities who simply don’t know where to find them or how to connect with them. SkillPages solves that problem for both employer and prospective employee/contractor.
 
With the potential to create so much value, SkillPages could become one of the most disruptive social media sites conceived. Clearly, the power to create so much value in economic and social terms makes SkillPages one of the most exciting new start-ups on the social media horizon. Hundreds of thousands of people are joining Skillpages every month since it launched in January, making


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London Riots, Nuclear Meltdown, Euro Risk and Markets… Rally?!

Protests in London, Japan Nuclear Meltdown, Euro currency risk and the market is… rallying?





Market(Tamer) Sunday Snapshot





Long In The Tooth Rally

Asia down overnight, futures down, euro rate hike…. rather than rehash it all, let’s get to the bottom of line of picks and performance!

 





Was Friday’s Price Action a Fool’s Bounce?

The indexes are currently forming a "Bear Flag" bearish continuation pattern and although Friday’s price action was very bullish, I don’t feel that we are done moving down. Watch for the indexes to test support 5-6% below the recent high.





Bullish But Cautious

We continue to move higher and I continue to be bullish. We are currently at a key resistance level in the Compq and we are testing the closing high from October 2007 at 2834. We are also about 29 points away from the trading high at 2862 in that index. The levels that we need to take note of on the DOW, the SPX and the Compq are the 20 simple moving average and the prominent trend line that has been in place since September. If those key areas are breached, that could be significant and the beginning of a possible short term pullback. Stay nimble and it wouldn’t be a bad thing to consider a hedge





 
 
 

Phil's Favorites

The Investigation: A Search For the Truth in Ten Acts.

Tune in to a star-studded live stream event ripped straight from the pages of the Mueller Report called The Investigation: A Search for the Truth in Ten Acts.

...

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Zero Hedge

2 Year Auction Unexpectedly Strong Just As Powell Pours Cold Water On Treasuries

Courtesy of ZeroHedge. View original post here.

In the chaos over Powell's unexpectedly less dovish comments which hit the tape at exactly 1pm, when sent stocks lower, and the dollar and bond yields sharply higher, the primary market had no time to react as it had already submitted its indications for today's $40 billion 2 Year auction when Powell suddenly pulled the rug from under the bond market, sending 2Y yields higher and yet since there was solid demand for the auction before Powell's commentary, the sale of 2Y bonds was a smashing success, stopping at a high yield of 1.695%, 1bp inside the 1....



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ValueWalk

Beyond Meat vs Impossible Burger: Comparing The Vegan Meat Burgers

 

Beyond Meat vs Impossible Burger: Comparing The Vegan Meat Burgers

Courtesy of Vikas Shukla, ValueWalk

Pexels / Pixabay

The trend of vegan food has been gathering momentum in the last few years as people become more health conscious. They have also begun to realize the environmental impact of raising meat for human consumption. According to PETA, it takes an estimated 1...



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Kimble Charting Solutions

Wilshire 5000 Creating A Triple Top? An Important Breakout Test Is In Play!

Courtesy of Chris Kimble.

The stock market has been on fire of late, rallying up to the edge of price resistance on several indexes. Today, we look at one of those stock market indexes: the Wilshire 5000.

The Wilshire 5000 tracks all of the stocks in the US market, so it is a broad-based index that carries significant importance when gauging the health of the overall US stock market.

Looking at the long-term “weekly” chart above, it is pretty clear that the index is at an important price juncture.

The Wilshire 5000 spent the last 25 years trading within a rising price channel (1)...



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Insider Scoop

Jefferies Upgrades Deere, Cites 'Significantly Improved Farmer Income Outlook'

Courtesy of Benzinga.

Farmer buying power will remain pressured for 2019, but this will change for the better next year and will help support Deere & Company (NYSE: DE), according to Jefferies.

The Analyst

Jefferies' Stephen Volkmann upgraded Deere from Hold to Buy with a price target lifted from $150 to $190....



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Chart School

Formula for when the Great Stock Market Rally ends

Courtesy of Read the Ticker.

When valuations for the boring water company or the boring electric company is trading like your Facebook, Apple, Amazon or Netflix or Google (ie FANG) you know something is wrong.

This is when a seriously over valued market is screaming at you.

Of course the reader must understand in a world where money printing goes super nuts (Zimbabwe style) the stock market may go hyper inflationary and picking a time frame for a top is never a good idea, but we are not there yet. There is no Ben Bernanke helicopter money to the masses yet (ie MMT). 

To see when water company's (and such like) are nearing the crazy FANG like valuations a review of the Dow Jones Utility Index channel shows us how history can repeat. The c...

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Digital Currencies

Cryptocurrencies are finally going mainstream - the battle is on to bring them under global control

 

Cryptocurrencies are finally going mainstream – the battle is on to bring them under global control

The high seas are getting lower. dianemeise

Courtesy of Iwa Salami, University of East London

The 21st-century revolutionaries who have dominated cryptocurrencies are having to move over. Mainstream financial institutions are adopting these assets and the blockchain technology that enables them, in what ...



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Biotech

Consumer genetic testing customers stretch their DNA data further with third-party interpretation websites

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

 

Consumer genetic testing customers stretch their DNA data further with third-party interpretation websites

If you’ve got the raw data, why not mine it for more info? Sergey Nivens/Shutterstock.com

Courtesy of Sarah Catherine Nelson, University of Washington

Back in 2016, Helen (a pseudonym) took three different direct-to-consumer (DTC) genetic tests: AncestryDNA, 23andMe and FamilyTreeDNA. She saw genetic testing as a way...



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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...



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Mapping The Market

It's Not Capitalism, it's Crony Capitalism

A good start from :

It's Not Capitalism, it's Crony Capitalism

Excerpt:

The threat to America is this: we have abandoned our core philosophy. Our first principle of this nation as a meritocracy, a free-market economy, where competition drives economic decision-making. In its place, we have allowed a malignancy to fester, a virulent pus-filled bastardized form of economics so corrosive in nature, so dangerously pestilent, that it presents an extinction-level threat to America – both the actual nation and the “idea” of America.

This all-encompassing mutant corruption saps men’s souls, crushes opportunities, and destroys economic mobility. Its a Smash & Grab system of ill-gotten re...



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OpTrader

Swing trading portfolio - week of September 11th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

·       How 2017 Will Affect Oil, the US Dollar and the European Union

...

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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