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Apple's "real" earnings grew a staggering 124.6% in Q4

• eatmyswan 18y ago
  To be in compliance with GAAP, Apple spread the revenue from its 6.9Million units worth of iphone sales (est. 1.4B revenue) this quarter to the lifetime of the iphone. Also most of the iphone revenue comes from monthly payments from AT&T. But the great thing about this type of accounting is that the the iPhone sales from this quarter will consistently add earnings during the next months or years of economic downturn. This provides a great hedge against the slowing economy for its quarterly earnings report. Wall Street considers volatility as risk so its better for the stock to have consistent good earnings.
• dmix 18y ago
  Thats a significant success by any measure, especially considering its in billions of dollars.
• jorgeortiz85 18y ago
  "This should infuriate the informed investor because it means that Apple is quite literally trading on P/E ratios that do not reflect more than half of its business." Yawn. No, it should -excite- informed investors because there's a tremendous opportunity to buy really cheap Apple stock from uninformed investors who don't know Apple's true earnings. Unless, of course, the world economy collapses and demand for expensive consumer goods dries up.
  • MaysonL 18y ago
    Yeah - Apple at a PE of 7 (when you net out the cash) is an amazing buy - assuming the economy doesn't collapse completely.
• moses1400 18y ago
  and im about to buy a macbook - so it will jump even more :)