Wednesday, April 23, 2014

Apple Earnings Note

Apple earnings looks to have rallied the Nasdaq after hours, with NDX futures up over 1%. I can't say if it's the stock buyback, the positive iPhone sales, the dividend increase, or the 7:1 stock split announcement. It seems since AAPL has for a few years had a lower P/E ratio than one might expect, given its growth, that the stock split might be the big news there. Is it unexpected? I don't know what the rumor mills were saying, but my ex-post reaction is that it might have been anticipated by a close follower of the company and stock, if they had taken into account the idea that everyone is a competitive participant in the market, ie. George Cooper's economic model. After all, stocks used to split all the time, then google for a long time, chose not to, all the way to a stock price over 1000. Then google chooses to split. It's not too outrageous to suggest that that was the impetus for the apple split. Or at least a catalyst. Everyone competes: companies, CEOs, countries, governments, central banks, sports players, kids, adults, plants, animals, fish. Keeping in mind what the principal competition is doing can be quite useful in any type of market analysis.

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