Got a major sell signal for AAPL today ... from my mom

[swissaustrian]

I've been talking to my mom on the phone today. She is 69 years old and never ever touched a computer in her life. She even got problems with a simple cell (not: smart) phone.
So the conversation goes on for a while and I'm telling her that I'm having a hard time finding good (non-mining) stocks to put some of her retirement money in and then she says:
"You know what, why don't you buy me some Apple stocks? I've talked to one of my best friends (another lady about her age) and we both think it's a great company. They're all over the news, they have to be great."

As a contrarian, I instantly took this as a major sell signal for APPL. My mom has NEVER traded stocks and has never dealt with any AAPL product and any computer or smart phone for that matter.

Remember the famous rule from the 1929 crash:

When even shoeshine boys are giving you stock tips, it’s time to sell (Joseph P. Kennedy?)

http://www.barrypopik.com/index.php/...o_sell_joseph/

Don't get me wrong:
I don't want to say my mom should be compared to a shoeshine boy, but as far as stocks and technology are concerned her knowledge is at the level of such a person.

------------------

Getting a little more serious:
Recently, there have been reports about questionable accounting methods used by AAPL to inflate earnings by accounting for sales of products which aren't actually sold.
Additionally, the company is considering to use it's huge pile of cash to broaden their product portfolio which usually ends in a desaster.
EVERYONE is on one side of the trade. Literally all big fundmanagers own APPL. The trade is totally overcrowded.
APPL faces problems with their manufacturing slaves in China.

etc. there are a lot of reasons to be cautious.

iAm considering to buy some puts...

[specsaregood]

Made my first big $$ off of AAPL back in 96 or 97?....put my entire tax refund into it at around $15/share. I had just played with rhapsody on a pc and I knew they were coming back big time....

[Zippyjuan]

Apple's success will make it difficult for them to continue to increase revenues at the rates which they have in the past. They won't go away certainly but long term it will be hard to match what they have been doing up until now. I remember when Sony was the hot company coming out with some cool gadget every year everybody seemed to want. Even Micosoft peaked. Apple may be there now. If Apple were to institute offering dividends, they could be more attractive as a stock in my opinion. Other investors seem to think so too: http://www.bloomberg.com/news/2012-0...-98b-cash.html

[dannno]

I like how the OP thinks.

[specsaregood]

Apple's success will make it difficult for them to continue to increase revenues at the rates which they have in the past. They won't go away certainly but long term it will be hard to match what they have been doing up until now. I remember when Sony was the hot company coming out with some cool gadget every year everybody seemed to want. Even Micosoft peaked. Apple may be there now. If Apple were to institute offering dividends, they could be more attractive as a stock in my opinion. Other investors seem to think so too: http://www.bloomberg.com/news/2012-0...-98b-cash.html

Funny. They went from huge to almost irrelevent in the 80s -> 90's as well. I wouldn't be so fast to say it couldn't happen again.

[swissaustrian]

Apple's success will make it difficult for them to continue to increase revenues at the rates which they have in the past. They won't go away certainly but long term it will be hard to match what they have been doing up until now. I remember when Sony was the hot company coming out with some cool gadget every year everybody seemed to want. Even Micosoft peaked. Apple may be there now. If Apple were to institute offering dividends, they could be more attractive as a stock in my opinion. Other investors seem to think so too: http://www.bloomberg.com/news/2012-0...-98b-cash.html

Using their cash for dividends would certainly be better than questionable accquisitions...

[libertybrewcity]

Interesting thoughts, but I believe a lot of the hype around them is that they might start issuing a dividend fairly soon. They have something like 90-100 billion dollars in cash loaded up and nothing to do with it. Also, they are mainly known for selling computers and phones, but it's whispers about other products that would give them revenue. I believe they are thinking of taking on the television market next, and if that's the case, game over. 1000 dollar stock.

[dannno]

Interesting thoughts, but I believe a lot of the hype around them is that they might start issuing a dividend fairly soon. They have something like 90-100 billion dollars in cash loaded up and nothing to do with it. Also, they are mainly known for selling computers and phones, but it's whispers about other products that would give them revenue. I believe they are thinking of taking on the television market next, and if that's the case, game over. 1000 dollar stock.

What, so I can go out and spend $1,600 on a tv that I can get at Best Buy for $499?!

My $450 laptop outperforms my roommate's $1800 macbook air, his is just lighter and thinner.. I run Ubuntu which functions like MacOS, no viruses, easy install and it's free... one of these days people are going to wake up.

[specsaregood]

Interesting thoughts, but I believe a lot of the hype around them is that they might start issuing a dividend fairly soon.

They issued their first dividend in the late 80's, just before their quick jaunt down the road of obsolescence.

[Blueskies]

There is most definitely a mania around Apple's stock.

But there was a mania around the stock $100 ago. $200 ago. $300 ago.

The company has $100B in the bank. They have no debt. They trade at a low PE.

Short it at your own peril. I wouldn't touch the stock because I believe that (one day) you'll be right and it will collapse. But it could go much higher before it goes lower.