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Apple Capital Stock, a Buying Opportunity? Here are some Observations β­β­β­πŸ“πŸ“πŸ“

May 21, 2013

Apple Shares… a Buying Opportunity? Here are some Observations, from a non-analyst. I don’t give investment advice, not qualified to do so, not affialiated with Apple, but I can Read, Write, Add, Subtract, Multiply, Divide, Observe, and Reason.

πŸ”· Finally analysts are noticing that Apple is starting to form an incredibly bullish pattern its called an Inverse Head and Shoulders Pattern. Analysts generally know that a Head and Shoulders Pattern is the most common technical analysis pattern in trading.

πŸ”· Inverse Head and Shoulders patterns are an extremely bullish reversal pattern, that occurs when a stock forms a “Bottom” by printing a series of 3 lows. What is also important when this pattern occurs is Trading Volume; Volume must be heavy on the Lowest Low, which signals a wash-out, exhaustion-selling, where many “Sellers” have Sold their Positions. These characteristics have occurred in the recent (last 90 days) trading pattern for Apple.

πŸ”· Catalyst is visible. Tim Cook the CEO of Apple, is now coming out and lobbing for Apple verbally in the Public domain. This is a sign of leadership that major hedge funds have been looking for.

πŸ”· Mr. Cook is testifying before a Congressional Committee, in effort to suggest to the US Government methodologies regarding Repatriating Billions of dollars that Apple has earned overseas. If successful Apple may bring back into the US these funds at much a lower tax rate, to stimulate investment in the US.

πŸ”· The US Government should work with Apple and Mr. Cook on this, as Apple is already a huge taxpayer, and a huge employer of US Citizens. This gives Apple some power to negotiate, and therefore, Apple and the US government may cut a deal on Apple’s off-shore earnings. The US Congress may sgtructure a tax incentive for any US based Company wityh off-shore earnings, in exchange for building plants in the USA with the hiring of US citizens, for example.

πŸ”· This may be Bullish for Apple stock as the uncertainty over Apple’s offshore cash hoard, may be resolved, as this issue is coming to the forefront, lifting the cloud of uncertainty. When you combine this Catalyst with the Bullish Inverse Head-and-Shoulders Chart Pattern, it may mean that Apple has finally bottomed.

πŸ”· Apple Fundamentals. Apple shares are trading at slightly over 10x earnings, very healthy financially, and a good product pipe-line with the known products. also the Dividend has been increased by 15%, giving an investor’s Yield is at or near 3%.

πŸ”· Apple announced its financial results for its fiscal 2013 second quarter ended March 30, 2013. The Company posted quarterly revenue of $43.6 billion and quarterly net profit of $9.5 billion, or $10.09 per diluted share. These results compare to revenue of $39.2 billion and net profit of $11.6 billion, or $12.30 per diluted share, in the year-ago quarter. Gross margin was 37.5% compared to 47.4% in the year-ago quarter. International sales accounted for 66% of the quarter’s revenue.

πŸ”· Apple sold 37.4 million iPhones in the quarter, compared to 35.1 million in the year-ago quarter.

πŸ”· Apple sold 19.5 million iPads during the quarter, compared to 11.8 million in the year-ago quarter.

πŸ”· Apple sold 3.9 million Macs, compared to 4 million in the year-ago quarter.

πŸ”· Apple’s retail stores continue to outsell (on a sales per square foot basis) all other retailers by a very large margin.

πŸ”· Horace Dediu of Asymco found that the number of Apple Store visitors grew 7% last quarter and helped Apple’s in-store retail revenue reach a record $57.60 per visitor. Each store is now averaging sales of $13 million per quarter, the highest level for any non-holiday quarter.

πŸ”·The average number of visitors per Apple store was said to have reached 250,000 per quarter in the past 12 months, up from 170,000 per store per quarter between 2009 and 2010. Dediu speculates that the jump in visitors could be from more space in new stores and renovations in older stores.

πŸ”·Apple’s retail stores now outsell No.2 Tiffany & Co two-to-one and No.3 Lululemon Athletica three-to-one.

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