Investing General Discussion

16:30 [AAPL] Reports Q2 $1.52 v $1.43e, Rev $97.3B v $94.5Be; Authorizes $90B increase to its share buyback program; Raises Quarterly dividend 4.5% to $0.23 from $0.22
- Gross margin % v 42.5% y/y (calculated)
- iPhone Rev $50.6B v $47.9B y/y v $49.2Be
- iPad Rev $7.7B v $7.8B y/y - Services Rev $19.8B v $16.9B y/y
- Greater China Rev $18.3B v $17.7B y/y (v $25.8B q/q)
- Wearables, Home & Accessories ('other') products revenue $8.81B v $7.84B y/y v $9.0Be (includes sales of Apple TV, Apple Watch, Beats Electronics, iPod and Apple-branded and third-party accessories)
- CEO: “We are very pleased with our record business results for the March quarter, as we set an all-time revenue record for Services and March quarter revenue records for iPhone, Mac, and Wearables, Home and Accessories. Continued strong customer demand for our products helped us achieve an all-time high for our installed base of active devices,” said Luca Maestri, Apple’s CFO. “Our strong operating performance generated over $28 billion in operating cash flow, and allowed us to return nearly $27 billion to our shareholders during the quarter.”
- iPad had very significant supply constraints in Q2; Mac is doing incredibly well despite supply constraints
- Ukraine war impacted March results and will have further impact in Q3

Depressing.

I think back to this rally we had today and know retail just got absolutely blasted from FOMO.

Sanrith Descartes said:

There is money to be made trading this market but the risk reward ratio is high. Personally I am mostly sticking to adding to holdings I own trust rather than finding something new. And of course adding to indexes.

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It is definitely a hard market to predict for the next year or so until the feds strategy becomes clearer. On the surface we have a stock market that melted way up due to money printing over the past 2 years that has downside if rates tighten. But on the other side we have a extremely strong dollar, strong employment, strong nominal wage growth.

The really tough thing for a lot of us to contemplate given we have lived all our lives in an environment where you could ignore inflation I think is the possibility that we see nominal gains in the stocks but real losses as inflation stays high near term and the fed tightening hurts the markets, but that might be the best most of us can do since holding cash would be even worse. It is kind of hard to wrap my head around but even a 7% gain on your portfolio in the year, the target we heard for years as the benchmark of what you should expect, is probably going to mean a loss in terms of real money.

I just don't see the sort of massive structural problems we had in 99 or 08 that drove the markets down to half their highs.

Creslin said:

a 7% gain on your portfolio in the year, the target we heard for years as the benchmark of what you should expect, is probably going to mean a loss in terms of real money.

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Rest easy; that 7% figure is net of inflation.

Captain Suave said:

That 7% figure is net of inflation.

S&P 500: Total and Inflation-Adjusted Historical Returns

Historical performance of the U.S. stock market, measured through the S&P500 index. Charts for total return and inflation-adjusted data are included.

www.simplestockinvesting.com

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Ya I know, I just mean for a long time it was 7%, which really meant you needed a 9-10% gain and now you need.. what? a 17 or 18% gain, in terms of perception it is a huge shift.

It is also a huge shift in terms of the decision to sell stocks and hold cash, which imo ultimately means that this stock market won't decline much if at all in nominal terms even in the worst case.

After hours AAPL came down because of:

-Apple executives warned it could sustain a hit of up to $8B in the current quarter from headwinds including supply chain shortages and factory shutdowns in China, underscoring how the challenges posed by the pandemic are far from over for the world’s most valuable company.
- Not providing specific Rev guidance due to continued uncertainties
- June quarter (Q3) services growth will still be double digit but will decelerate from March quarter

China names up today on the back of:

03:43 (CN) China said to end regulatory scrutiny over Big Tech and give sector bigger role in boosting slowing economy - SCMP
- A joint regulatory meeting is set to take place on Saturday, Apr 30th to put all regulators on the same page regarding Beijing’s new decision

ABBV

07:43 [ABBV] Reports Q1 $3.16 v $3.15e, Rev $13.5B v $13.5Be
-cutting EPS outlook

- Cuts FY22 $13.92-14.12 v $14.13e (prior $14.00-14.20)* includes an unfavorable impact of $0.08 per share related to acquired IPR&D and milestones expense incurred during the first quarter 2022. The company's 2022 adjusted diluted EPS guidance excludes any impact from acquired IPR&D and milestones that may be incurred beyond the first quarter of 2022, as both cannot be reliably forecasted.

Personal income rose by 0.5% in March following February's 0.7% gain, faster than the expected 0.4% gain in a survey conducted by Bloomberg.

At the same time, personal consumption expenditures were up 1.1%, well above the 0.6% increase expected. After adjustment for inflation, real PCE rose by 0.2% after a 0.1% increase in February, compared with expectations for a 0.1% decrease.

The PCE price index rose by 0.9%, as expected, lifting the year-over-year rate to 6.6% from 6.3% in February. The price index rose by 0.5% month-over-month in February.

The core PCE price index increased by 0.3%, also right on expectations and following a 0.3% gain in February. The year-over-year rate slowed modestly to 5.2% from 5.3% in the previous month.

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Eh, I guess its positive, but still seems kind of weak. Wonder if it outweighs the AMZN/AAPL reports.

Wow, we really are gonna give back yesterday's gains, aren't we?

In the interest of keeping this thread moving in a choppy market, I am finally finishing up Reminiscences. I found it a bit tough to get into at first (the idea of being a young kid trading stocks didn't resonate), but I definitely fell in love with it after a while.

So many savage truths contained in that text lol. It felt like he was looking into my soul as someone learning to trade.

What's next on the syllabus, Professor Jysin ?

Zzen said:

Wow, we really are gonna give back yesterday's gains, aren't we?

In the interest of keeping this thread moving in a choppy market, I am finally finishing up Reminiscences. I found it a bit tough to get into at first (the idea of being a young kid trading stocks didn't resonate), but I definitely fell in love with it after a while.

So many savage truths contained in that text lol. It felt like he was looking into my soul as someone learning to trade.

What's next on the syllabus, Professor Jysin ?

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That book wasn't on my list. I may check it out if you liked it.

In order of impact for me, personally:

• Trade Mindfully by Gary Dayton
• Trading in the Zone by Mark Douglas
• The Art and Science of Technical Analysis by Adam Grimes
• Antifragile by Nassim Taleb
• The Candlestick Course by Steve Nison
• Principles by Ray Dalio
• Market Wizards by Jack Schwager

Creslin said:

Ya I know, I just mean for a long time it was 7%, which really meant you needed a 9-10% gain and now you need.. what? a 17 or 18% gain, in terms of perception it is a huge shift.

It is also a huge shift in terms of the decision to sell stocks and hold cash, which imo ultimately means that this stock market won't decline much if at all in nominal terms even in the worst case.

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CAGR of the S&P 500 with inflation is 7.14%. That includes the Great Depression, 70's stagflation, and 1999-2009 shit show.

That's why I say don't bet against the US economy. And even with the current weird crap going on, most of the big boys in the global economy are based on the US exchanges. Add 20% or so to your portfolio in a global index if you want to capture stuff like Nestle or Samsung.

So the rate hike announcement is wed next week? Is that right? Its not clear to me from the calendar