Gene Munster says that Apple has entered a new era

With Apple's shares making a new all-time high this morning at $187.67, former analyst turned Venture Capital executive Gene Munster says that Apple is starting a whole new era. Munster says that Warren Buffet's purchase of 75 million additional shares of Apple during the first quarter is just one sign of this new "Apple story." Munster adds that this new era is a week old, and started with the release of the company's fiscal second quarter earnings report. "The big picture here is, we're essentially one week into a new type of thinking around the Apple story," said Munster.

The former Piper Jaffray analyst says that with iPhone sales less volatile, investors don't have to worry about quarter-to-quarter changes in Apple's handset sales. He also points out that Apple has plenty of cash available for more share buybacks. Last week, the company announced that it is returning $100 billion to stockholders by buying back its own shares. It also raised the dividend by 16%.

Independent analyst Neil Cybart says that Apple's balance sheet initiative is what will now drive the company's shares instead of iPhone sales. And that change is happening just in time; iPhone sales made up 62% of Apple's net sales in its latest quarter, down from 67% a year ago. Munster has followed Apple for many years and says that this new era for Apple could be just as big for the company as the introduction of the iPhone turned out to be.

Shares that are bought back by Apple are retired and are no longer considered outstanding. Long term investors like Warren Buffet like to see this type of activity because it means that the company thinks its own shares are a value. And if there is one thing that attracts Buffet like flies to honey, it is a stock trading below what he sees as its future intrinsic value. And in theory, who would know more about the real future value of Apple than Apple?

source: CNBC



1. Crispin_Gatieza

Posts: 3186; Member since: Jan 23, 2014

So much for Apple taking their tax-cut windfall and letting it "trickle down" to their workforce. I don't blame them one bit, it's their prerogative as a for-profit company.

3. Furbal unregistered

They received bonuses and many received it in the form of stocks. Buyback increases the value if that they have. Win win

5. Finalflash

Posts: 4063; Member since: Jul 23, 2013

Lol no they didn't, most just received a one off payment, a mere $2500. The $100 billion in buybacks only makes Cook and Co. richer and I guess Cook is a bit envious of not being in the billionaire club even though he's the CEO of the richest company in the world. Both Satya Nadella and Sundar Pichai long since reached that milestone while poor Timmy (relatively speaking) hasn't been able to cross that line for years.

10. Phullofphil

Posts: 1846; Member since: Feb 10, 2009

Trickle down economics never will work. Nobody in these coment sections has a clue to what there talks g about when it comes to the stock market so whatever.

2. fsnas

Posts: 122; Member since: Jun 18, 2012

It's not Apple's problem that it f*cks bending pantsless people.

7. bucky

Posts: 3797; Member since: Sep 30, 2009

Yes, all these people buy their products because they’re idiots and here you are getting offended- who is the crazy fan? Quality products = good sales.

4. CreeDiddy

Posts: 2284; Member since: Nov 04, 2011

First company to reach a trillion...Man sick money...

6. cncrim

Posts: 1590; Member since: Aug 15, 2011

Warren Buffet is big whale so whatever he do everyone want to copy however our 60k 100K barely make any dent. Unfortunately, we pump in the money, the big whale dump small Weinee will be the one get hurt. So whatever Buffet invest wisely, Either way Apple is great and safe bet for investors.

9. mixedfish

Posts: 1570; Member since: Nov 17, 2013

Buffet doesn't pump and dump, he never has. His portfolio is basically the US.

8. darkkjedii

Posts: 31756; Member since: Feb 05, 2011

People complain about Apple, say that Apple sucks, and that they’re fav OEM Is better, but I bet the OEM’s wish they were doing half as good as Apple. Cool & company know how to get money.

13. damonarena

Posts: 47; Member since: Apr 30, 2018

what do you get from their money,, its all built by selling cheap products at high prices with maximum profit while the actual product is just average

14. darkkjedii

Posts: 31756; Member since: Feb 05, 2011

That’s the dumbest response to my post, you coulda made. Nothing further need be said.

16. civicsr2cool

Posts: 281; Member since: Oct 19, 2016

First trillion dollar company in the world! wont be long! And all from iphone/ipad/mac sales too! Google/microsoft both make their profits from cloud services and ad services. Apple is a tech giant!

17. mootu

Posts: 1541; Member since: Mar 16, 2017

Nope, PetroChina surpassed $1 trillion in market cap in 2007. Apple would be the first "tech" company to hit the trillion. And as for the most valuable company that would probably be Saudi Aramco who are not publicly traded at the moment (but soon will be) and is valued at up to $10 trillion.

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