Solfège
Re the markets and "A Reminder" (my post from yesterday):
Oil has traded the past week kindasorta heavy, and this morning especially so, as if it wants to decline. I do not know (yet) how low is low, but I do recognize that should this perception become reality, equities, in general, could not only stabilize but head higher, in spite of the objective measures that continue to look ragged. (Consider each tick and moment individually; intra-day reversals from big gaps are a common occurrence. Keep in mind, however, the half-life of any trend and its reversal.)
Re Apple/AAPL comes this précis from Briefing:
"The analyst community is positive on Apple following better than expected results but somewhat unexpectedly conservative guidance. Most firms expect the co to beat the guidance despite management's fears of Intel/Mac combo causing buyers to hold-off until the launch...
JP Morgan notes that conservative guidance has become the norm. However, Apple has exceeded guidance by an average of 58% over the past three quarters. In addition, they believe Apple's print last night lays to rest bearish speculation surrounding iPod that has dragged on the stock in recent weeks. Concerns over excess iPod inventory and iTunes market share losses to subscription models have proved overblown. Expects the shares to gain their momentum and reits Overweight...
UBS notes the shares are trading at EV/sales of slightly more than 2x, which is higher than Apple's pre-bubble multiple but in-line with many of its peers. Given Apple has shown iPod sales are still on track, they believe these results could provide a relief despite the conservative guidance...
Morgan Stanley is more cautious, as they think the $0.32 guidance reflects the possibility that new product announcements may not carry the same "bang" as typical. Time will tell - but for now, the firm is taking rev ests down to reflect this risk. EPS forecasts remain the same given operating leverage in the model."
In pre-opening activity, Apple/AAPL shares last traded at $40.50, +$2.15. If this activity holds and trades higher in the regular session through to the close -- and I believe it will -- then the past 5 months translates as a massive base. (Recall the breakout levels of $39, $40, $41, and $43.) It would not be a surprise to see the shares trading at new all time highs within several weeks.
Re Google/GOOG is this note (also from Briefing):
"Lehman raises its target on GOOG to $350 from $275 and raises its 2005-06 ests, as they expect GOOG to post strong Q2 numbers on the heels of continued secular growth in search, international expansion, and further gains in monetization. Firm raises its EBITDA margins for Q2 and the outer years, as GOOG simply cannot spend money fast enough given the extremely high incremental margins associated with the core search business; the company's technological focus and lean approach to new projects provide distinct advantages in terms of costs and efficiency."
The last trade for Google/GOOG shares in pre-opening activity was $305.50, +$6.50 To the consternation of the bears, new all time highs are within sight. (BTW, if you would like a pdf copy of the Lehman research report, please email your request. Alas, I cannot upload it.)
Oil has traded the past week kindasorta heavy, and this morning especially so, as if it wants to decline. I do not know (yet) how low is low, but I do recognize that should this perception become reality, equities, in general, could not only stabilize but head higher, in spite of the objective measures that continue to look ragged. (Consider each tick and moment individually; intra-day reversals from big gaps are a common occurrence. Keep in mind, however, the half-life of any trend and its reversal.)
Re Apple/AAPL comes this précis from Briefing:
"The analyst community is positive on Apple following better than expected results but somewhat unexpectedly conservative guidance. Most firms expect the co to beat the guidance despite management's fears of Intel/Mac combo causing buyers to hold-off until the launch...
JP Morgan notes that conservative guidance has become the norm. However, Apple has exceeded guidance by an average of 58% over the past three quarters. In addition, they believe Apple's print last night lays to rest bearish speculation surrounding iPod that has dragged on the stock in recent weeks. Concerns over excess iPod inventory and iTunes market share losses to subscription models have proved overblown. Expects the shares to gain their momentum and reits Overweight...
UBS notes the shares are trading at EV/sales of slightly more than 2x, which is higher than Apple's pre-bubble multiple but in-line with many of its peers. Given Apple has shown iPod sales are still on track, they believe these results could provide a relief despite the conservative guidance...
Morgan Stanley is more cautious, as they think the $0.32 guidance reflects the possibility that new product announcements may not carry the same "bang" as typical. Time will tell - but for now, the firm is taking rev ests down to reflect this risk. EPS forecasts remain the same given operating leverage in the model."
In pre-opening activity, Apple/AAPL shares last traded at $40.50, +$2.15. If this activity holds and trades higher in the regular session through to the close -- and I believe it will -- then the past 5 months translates as a massive base. (Recall the breakout levels of $39, $40, $41, and $43.) It would not be a surprise to see the shares trading at new all time highs within several weeks.
Re Google/GOOG is this note (also from Briefing):
"Lehman raises its target on GOOG to $350 from $275 and raises its 2005-06 ests, as they expect GOOG to post strong Q2 numbers on the heels of continued secular growth in search, international expansion, and further gains in monetization. Firm raises its EBITDA margins for Q2 and the outer years, as GOOG simply cannot spend money fast enough given the extremely high incremental margins associated with the core search business; the company's technological focus and lean approach to new projects provide distinct advantages in terms of costs and efficiency."
The last trade for Google/GOOG shares in pre-opening activity was $305.50, +$6.50 To the consternation of the bears, new all time highs are within sight. (BTW, if you would like a pdf copy of the Lehman research report, please email your request. Alas, I cannot upload it.)
posted by David M Gordon | 5:41 AM
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