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Strategies & Market Trends : Buffettology -- Ignore unavailable to you. Want to Upgrade?

To: LauA who wrote (1700)7/22/1999 1:52:00 PM
From: Michael Burry1 Recommendation  Respond to of 4661
What tells me Apple is a Buffett stock can be summed up in recent events.

Analysts expect the new iBook to retail for 1299. Apple jumps the price 30% to 1699 and gets some criticism for the price at the same time analysts are saying "they'll sell as many as they can make."
If this isn't market power, I don't know what is. To look at all box makers, lump them in one group, and say Apple has only this much percent is the wrong way to look at it (even so, the share is growing, not declining). To say that corporate IS isn't going to rally behind Apple is also missing the point. This is a consumer franchise, not a corporate one. And I think Buffett's point has always been that in the long run it is the consumer franchises that last. There is not another box-maker out there that could pull off what Apple is doing. No, not even Dell, jhg. That software makers (including Microsoft) are once again pouring resources into Apple development at breakneck pace is another clue as to the longevity here.

Plus, you have all of Wall Street trained to think that Apple is the antithesis of good business thanks to case studies from the 80s. How can you go wrong? ;)


To: LauA who wrote (1700)7/24/1999 2:15:00 AM
From: James Clarke  Read Replies (4) | Respond to of 4661

"Zippedey doo da, Zippeday 'ey.
For internet presence we're gonna overpay.
Plenty of losses comin' our way.
Zippedey doo da, Zippeyday 'ey"

My question is what price Disney? 25? 22? 20? This puppy is clearly a Buffett stock, and the stock price is disintigrating under current management. (Remember what Buffett says - buy a business that could be run by morons, because someday it will be - that is where Disney is today). These guys just bought out a large internet company at a premium to the market price. And then Eisner shows up on CNBC talking about what a great deal it was. You just want Bambi to grow some horns and gore him.

And if they are doing deals like that, I don't know how relevant any valuation analysis can be. I am interested below 25, but I have a lot of trouble having much conviction.