APPLE REPORTS STRONG EARNINGS. MY TAKE.
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Apple just reported very strong earnings. Apple showed strength in many of its main product categories during the conference call. Now the question is will I buy or sell Apple stock!
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Well, ladies and gentlemen, Apple just reported some phenomenal earning some very, very strong earnings. So what I want to do with you guys here today is we’re going to go through all the numbers that.
I think are very important to look at what in regards to Apple, then we’ll get into my take on all these different numbers. If I’m going to buy any Apple shares out there, if I’m going to sell off any Apple shares or any plans like that.
I’m wearing my bucket hat today, you what you know what that means. That means that we’re making buckets of money out here, guys, it is a very, very good day out there. So let’s get into all of this in regards to Apple.
By the way, it’s the last day you can get in my stock market membership group for half price, it’s the first link down there in the description, enter code half off at checkout, it’ll take half of the price of the first month.
Every month after that last day. So if you want to get in my private stock market membership group, you should probably get in there now. So first off Apple stock, it’s up around 3% after hours is flirting with its all time high.
There’s a very good likelihood that if the conference call is strong, if it’s a really strong conference call, there’s not much weakness in that conference call. And people get pretty bullish.
It’s a possibility that this stock could maybe hit a trillion dollar market cap tomorrow, but it’s just going to depend on how that conference call goes and how much money flows into Apple stock.
But as far as the numbers very, very strong numbers so revenue came in at up 17% that is a big, that’s a big big number there guys. When you think about Apple and the type of numbers.
They’re reporting already and how big this company is to have revenue up 17% this is very big for the company epcs was up 40% for this company. Okay, think about how big apple is okay, there’s a company has almost a trillion dollar market cap.
They just did an EP s rise of 40% think about the profits this company already has coming in. absolutely unbelievable. And EP s was expected to only be up around 30% which is still amazing.
So to come through a 40% plus guys, it’s just a sick number sick number. So revenue split about 40% was in the US about 60% International. If you think about Apple historically, it was mostly a US based company, okay.
In terms of where their sales were coming in from is a company now that is well diversified around the world. They’ve got a lot of growth from a lot of places. So now they’re about 40% us and about 60% International they can probably get to a place someday where they’re about 3070 or somewhere around there.
China revenue was up 19% Okay, so China grew faster than the company as a whole something I’m gonna bring out to you real quick that people have never understood about Apple in China.
They’ve always looked at Apple in China is like oh my gosh, like Apple won’t be able to grow that much in China because you know the Chinese they might want cheaper smartphones or something or something like that.
What you never understand what people refuse to understand is that in China, the smartphone is their everything device okay? So in the United States of America, you know someone like myself.
I own obviously an iPhone, I own multiple iPads, I own multiple Macs. I have TVs Everything okay? In China It is not like that at all. Okay, a lot of people only have a smartphone Okay.
So they put all the money that they would spend on all these different electronics all into their smartphone. So when Apple comes out with $1,000 smartphone the way the Chinese look at that they look at that as well.
This is my everything device, it is worth it. Okay, it is worth it. So that’s something that people have never understood about Apple in China all I’ve ever heard about Apple in China is how awesome cheaper smartphones is gonna hurt them and this and that.
And all Apple has done year after year is have amazing growth amazing growth because if it’s your everything, you want to have the best man you want to have the best and iPhone 10 is the best Okay, so that’s a big thing.
Their iPhone revenue was up 20% but here’s the most impressive thing about that units were only up 1% Okay, think about that first second units only up one person but iPhone revenue of 20%.
Why is that because ASP or iPhone have exploded since iPhone 10 came out much higher price device and if you look at it from Apple’s perspective, does Apple really care if they get the more revenue from selling cheaper iPhones or more expensive iPhones Apple wouldn’t much rather sell much more expensive.
iPhones the highest of the highest end devices and get their their revenue coming in that way rather than then cheap down and just have a bunch of cheap smartphones out there guys. So that is very big there.
Okay, services continues to explode up 31% up 31% in the quarter guys, that’s a second straight quarter that they’ve grown at over a 30% clip. Now I do not think that that’s sustainable long term unless they come out with some type of unbelievable video service like Netflix or something like that.
I do not think that number is sustainable long term. I think maybe for the rest of this year they can be somewhere around there. I think next year would be somewhere around a 20% clip or so.
But once again if they could come up with something that’s a competitor netflix they can keep those type of growth rates up for a long time. Other products up 37% for the quarter very strong that’s all that’s things like you know the apple home pod you know anything that’s all you know.
Like headphones and things like that, okay? I watch or Apple watch or or whatnot. So that category is still a fast growing category. And that’s getting to be a bigger and bigger chunk of the pie now because this is now they did close to $4 billion in that category in the last 90 days, all right.
So this pie is getting bigger. This pie is now the second biggest pie and they’re increasing at a rapid rate and still their biggest pie is growing rapidly as well. So unbelievable company alright.
Dividend is going to be paid on August 16. Two I think shareholders as of August 13 73 cents revenue guidance might be the most impressive thing it came in very strong the mid points around 61 billion US versus 59 point 5 billion was expected.
Everything everything I ever said about Apple is coming. 100% true. For the last year or two on this channel. I told people that ASP is going to explode that’s going to explode Apple’s profitability.
People said no one would buy $1,000 smartphones I said you are crazy if you think no one’s gonna buy $1,000 smartphones and iPhone 10s of the top, you know, smartphone all around the world. Okay.
It doesn’t matter if it’s $1,000 if it has the specs for it, and people love that type of device they’re going to pay $1,000 for people that no one would do it it’s coming true Okay, I said APS would explode not only because ASP is going up.
I said because they’re buying back a ton of shares and that’s exactly what’s happened and it’s even better than I expected. I never expected them to hit a 40% number. I expected it to be maybe 20 to 30% 40% of this even it’s even blown away what I expected this company to do okay.
So unbelievable company so now I want to give you my take on Apple if I’m going to buy any share selling shares or anything like that already guys so now for my take on these earnings in full first off.
Am I going to sell shares absolutely not I do not own any shares in my particular accounts however my wife’s biggest position by foreign await is Apple right? Now am I going to go out there and buy Apple shares.
No and I will tell you for two reasons really one’s a main reason one’s a minor reason okay. The first reason why I’m not going to go out there and buy Apple shares tomorrow is because I already have a massive position in a company named Cirrus Logic.
Cirrus Logic is a semiconductor supplier in their main customer by far and away they get 80% plus of their revenue from his Apple, okay, so already have an indirect play on Apple stock and Apple success going forward.
Basically, if Apple falters in goes through tough times, guess who else has a good doing it Cirrus Logic, okay, if Apple’s on the up and up, their business is going great as it is now Cirrus Logic stock gets pushed up and up and up.
Okay, so already have in it a huge position in a company that is is very reliant on Apple success. All right. So if I was to buy Apple stock, in my accounts, it’s already kind of like a duplicating process.
And once again, my wife’s biggest possession, by far and away is Apple, right? So for me, I’m not going to go out there and buy it. Also, I think, and this is a minor reason, but I think, I think in my opinion.
At least, I think Apple numbers will be hard to impress throughout 2019 I think 2019 numbers, we’re gonna laugh over the over these unbelievable service numbers over these unbelievable ASP numbers in iPhone 10.
And I think the numbers will be somewhat hard to impress, which may be you know, give some discounts out there in Apple stock, because everybody might go through the same thing that they always go through with Apple, oh my gosh.
Apple can’t grow. Imagine if iPhone units go down next year, everybody’s gonna be like, Oh my gosh, apples done the same blah, blah, blah, come down as as, as always, okay, that’s a strong possibility.
So in my opinion, I’m not desperate to add Apple shares here because it’s already my wife’s biggest position by far and away, so I’m already benefiting, they’re already have a massive stake in Cirrus Logic which I’m benefiting there.
So in my opinion, I have a lot of good places to put money out there. And also, I’ve changed my opinion as far as what’s the easiest stock to make money in over the next five years. I said it was Apple for a long time.
Just this past week, I changed it up and I said now Facebook is the easiest money I’m making in over the next five years. So my opinion do I want to buy Apple stock here Facebook.
I’m going to be acquiring more Facebook because I’m you know, only have what a $10,000 position ish, you know, in that company. And I believe that’s the easiest money to be made over the next five years.
But also in one more thing I think is going to start to be viewed in Apple’s respect, and I’ve talked about this for the past year or two, I think people are going to realize that Apple is not just a commodity device.
That these type of things are replacement cycles, and it’s going to start getting valued like a Johnson and Johnson of Procter and Gamble or something around an 18 or 20 pe, it is not valued there right now.
I mean, if you look at the four p on this company, it’s a 1415 somewhere around there, eventually they’re going to have to start be valued because people understand like services have recurring revenue.
If somebody is iPhone breaks, iPad breaks, Mac breaks, they go buy another one, it’s a replacement cycles. And never mind that there’s a wild card out there maybe in 2020 we could have a 5g iPhone.
We don’t know 100% on that yet, but whenever that 5g iPhone hits, that’s going to be the next major vector for the stock to explode higher. So a lot of exciting things there. You know, we have we’re gonna make a lot of money off this stock.
We will continue to make a lot of money off this stock and I’m very happy and very thankful. You know that it continues to perform well. But anyways, I want to hear from you guys out there. What is your opinion on Apple stock, or any of the stocks that we mentioned here today. Thank you for watching. Have a great day.