Apple Stock (Nasdaq: AAPL)

Is Apple Inc.'s (Nasdaq: AAPL) Bet on Liquidmetal About to Pay Off?

Apple Inc. (Nasdaq: AAPL) loves to think of lucrative new uses for other people's bright ideas.

For instance, the original iPod wouldn't have been possible without Toshiba's innovative 1.8-inch hard drive.

And when Steve Jobs learned about Gorilla Glass in 2006, he convinced Corning to revive the largely unused technology so Apple could put it in the iPhone.

So it's no surprise that Apple has been toying with yet another breakthrough technology.

It's called Liquidmetal.

Liquidmetal is a family of metal alloys that combines a variety of metallic elements. It's a technique that rapidly cools the mixture into a "metallic glass" with a distinctly different molecular structure than conventional metals. It becomes amorphous, as opposed to crystalline.

That amorphous structure is the secret behind Liquidmetal's many remarkable properties.

Now imagine what Apple could do with a material that:

  • Is five times as strong as aluminum and twice as strong as titanium;
  • Is three times as elastic as ordinary metals;
  • Is highly resistant to corrosion;
  • Is highly resistant to scratching and wear;
  • Has a fingerprint-resistant, glossy finish that needs no polishing;
  • And can be blow-molded like glass or injection-molded like plastic.
And while most of the basic ingredients of Liquidmetal -- zirconium, titanium, nickel, copper, and beryllium -- remain the same, adjustments to the ratios and manufacturing process can customize the alloy for many different purposes.

Invented in 1992 as part of a joint project between NASA, the California Institute of Technology and the U.S. Department of Energy, Liquidmetal creates vast new possibilities - particularly in the hands of a company as innovative and resource-rich as Apple.

As NASA's web page for spinoff technologies puts it:

"In the same way that the inventions of steel in the 1800s and plastic in the 1900s sparked revolutions for industry, [this] new class of amorphous alloys is poised to redefine materials science as we know it in the 21st century."

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Apple Inc. (NASDAQ: AAPL) Q2 Earnings: iPhone Carries the Day

Thanks to booming sales of the iPhone, Apple Inc. (NASDAQ: AAPL) Q2 earnings far outpaced Wall Street expectations.

Apple earned $12.30 a share on revenue of $39.2 billion, compared to analyst expectations of $9.99 a share on $36.6 billion. In the year-ago quarter Apple earned $6.40 a share on revenue of $26.67 billion.

Apple sold 35.1 million iPhones in the quarter, well beyond the 30.5 million analysts had projected.

AAPL stock had fallen in recent days when U.S. carriers AT&T Inc. (NYSE: T) and Verizon Communications (NYSE: VZ) both reported significant declines in their quarterly iPhone sales. The reports raised concerns, unfounded as it turned out, that iPhone sales would miss.

That's one reason why the news was greeted enthusiastically in after-hours trading. AAPL was up $41, or 7.29%, within 30 minutes of the earnings announcement.

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Don't Be Surprised by Apple Inc.'s (Nasdaq: AAPL) Q2 Earnings

Following its extraordinary beat last quarter, expectations for Apple Inc.'s (NASDAQ: AAPL) earnings are even higher than usual.

With Apple having such an outsized influence on the markets, even investors who don't hold the stock will be watching for Apple's Q2 earnings report after the closing bell today (Tuesday).

Still, with its stock having tumbled 11% in the past two weeks, from its peak of $640 April 10, Apple needs to beat Wall Street expectations.

If Apple earnings disappoint -- as occurred in the September quarter last year -- the stock will get beaten down even further. Such negative news would push the stock toward $500.

The consensus estimates for Apple's Q2 earnings are $9.99 per share on revenue of $36.6 billion, which most analysts believe is achievable.

In fact, just in the past week several analysts, such as Shaw Wu of Sterne Agee and Bill Shope of Goldman Sachs, again raised their estimates for iPhone and iPad sales.

However, Money Morning Chief Investing Strategist Keith Fitz-Gerald isn't so sure.



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He Predicted the Apple (Nasdaq: AAPL) Sell-Off … Here’s What's Next

The recent sell-off we've seen in Apple Inc. (Nasdaq: AAPL) shares came as a real stunner to Wall Street.

But Strike Force Editor Keith Fitz-Gerald saw the sell-off coming.

In fact, he predicted it.

Back on March 27, Keith wrote a lead story for Money Morning in which he articulated seven very clear reasons that investors should consider shorting Apple's stock.

And that was a couple of weeks after he detailed a "put" option strategy - in essence, a "short" trade - that resulted in a 47% profit (in just two days, no less) for the subscribers of his Strike Force trading service who followed his recommendation (a short-term reversal delivered those gains).

I wanted to know what tipped him off that a reversal was coming - as well as what he was predicting for Apple's shares going forward.

"BP, it was clear to me that this kind of reversal was coming - and sooner rather than later," Keith said during a private briefing late last week. "The shares had soared 75% in just five months - one analyst actually described the performance as "euphoric.' Suddenly, we're seeing all these mainstream-news-media stories explaining why Apple shares are going straight to $1,000. But I know from my own experience as a professional trader that even the shares of the best companies on earth don't go straight up. I happened to time it perfectly and help Strike Force subscribers take advantage of the reversal I just knew was in the offing."

Key Questions for Apple Stock

The way we see it, the Apple stock sell-off raises these three key questions for investors:

  • No. 1: What's going to happen to Apple shares in the near-term?
  • No. 2: If the stock is headed for a volatile stretch, is there any way to profit until the smoke clears?
  • No. 3: What's the long-term outlook for Apple - both the company and the stock?
Having worked with him for five years, I've seen Keith make gutsy calls like this - and have them pay off big - time and time again. Since I knew you'd be as interested in his answers as I was, we wanted to share them with you.

Here's what Keith had to say.



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Is Apple Stock (Nasdaq: AAPL) the Short of a Lifetime or the New Widow Maker?

I have a confession to make.

I believe Apple stock (Nasdaq: AAPL) is going to be world's first trillion-dollar company yet I want to short the snot out of it.

Am I being compulsive?...impulsive?....or foolish?

Perhaps it is all three considering that Apple has risen more than 3,000% in the last ten years, turning almost any attempt to go against the grain into a "widow maker" trade.

I say almost because I am one of the lucky ones.

A few weeks ago I recommended my Strike Force subscribers purchase put options on Apple, effectively shorting the stock. That resulted in a 47% profit in less than 24 hours for anyone who followed along, excluding fees and commissions.

I'm not alone in my thinking.

Uber investor Doug Kass, general partner of Seabreeze Partners Long/Short LP and Seabreeze Partners Long/Short Offshore LP, tweeted recently that he had covered "half his short" on Apple following the announcement of their dividend and buyback plan.

Given that the stock had run up to nearly $608 a share before the announcement, presumably Kass had banked some gains, too.

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New Apple Dividend Will Help Push Shares Higher (Nasdaq: AAPL)

A new Apple Inc. (Nasdaq: AAPL) dividend will make the stock even more attractive while expanding the pool of potential investors.

Apple announced Monday that starting in September, it will pay a $2.65 quarterly dividend.

Apple also announced a $10 billion stock buyback program to be conducted over three years, beginning in September.

The stock buyback was a bigger surprise to analysts. While too small to move the stock significantly, Apple CEO Tim Cook said the intent is to avoid earnings-per-share dilution from future shares issued to reward employees.

The Cupertino, CA company's enormous pile of cash and investments - over $97 billion as of the end of 2011 - had led to increasingly strident calls for an Apple dividend in recent years.

Yet despite today's investor-friendly moves, some think Apple could have done more.


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Apple Stock (Nasdaq: AAPL) at $600: Too Far Too Fast?

After Apple Inc. (Nasdaq: AAPL) touched $600, it set off speculation about whether the stock is truly worth $600 a share.

Some consider Apple's parabolic run-up in price as a warning sign of a bubble. In December Apple was still trading under $400.

Others look at the escalating sales growth of such Apple products as the iPhone and iPad and see justification for a $600 stock, a $700 stock, or even higher.

So we at Money Morning thought it would be worth comparing Apple's annual earnings numbers with the rise in its stock price since 2006, the year before the iPhone debuted.

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Tech Stocks to Watch: Cisco (CSCO), Apple (AAPL), Demandware (DWRE)

Tech stocks continued their all-star year yesterday (Thursday) with a Cisco Systems Inc. (Nasdaq: CSCO) deal, a new intraday high for Apple Inc. (Nasdaq: AAPL), and an explosive first-day performance for Demandware Inc. (NYSE: DWRE) moving markets.

The tech-heavy Nasdaq closed up 0.51% to 3,056.37.

Here's why these are the tech stocks to watch today (Friday):

Cisco Systems (CSCO) makes play for video: Cisco Systems Inc. (Nasdaq: CSCO) announced a $4 billion deal with video-software specialist NDS Group Ltd, a small company based outside London.

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How Apple Inc. (Nasdaq: AAPL) Became the Vampire Squid of Tech

Business partnerships with Apple Inc. (Nasdaq: AAPL) produce abundant profits - but usually only for Apple.

Using its clout as a vendor of highly desirable consumer technology, Apple secures extremely favorable deals with suppliers, providers of goods and services, and retailers.

Such deals are a major reason behind Apple's extraordinary profits.

"Can Apple continue to roll through industry after industry, soak up all the profits, and leave everything it touches as a smoking wreckage?" Craig Moffett, an analyst at Sanford Bernstein & Co. told the Los Angeles Times.

Despite increases in business volume, many companies that deal with the Cupertino, CA-company discover it's usually a one-sided relationship when it comes to profits.

Apple has, in effect, become the technology world's "vampire squid" -- a term coined by Rolling Stone Matt Taibbi in 2009 to describe Wall Street behemoth Goldman Sachs (NYSE: GS).

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How Apple Investors Can Profit from the New iPad

Apple Inc. (Nasdaq: AAPL) shoveled more coal into its money-making locomotive today (Wednesday) with the official launch of the New iPad.

If the third version of Apple's trend-setting tablet is as big a success as most expect, then owning the company's stock isn't the only way that Apple investors can profit. Many of Apple's suppliers will also reap reward from the New iPad.

The New iPad's marquee features, such as support for 4G LTE networks and the ultra-high resolution Retina display, should help Apple maintain its dominance in the tablet market at least through the end of the year. And if rumors of a 7-inch iPad Mini eventually pan out, Apple will have a cheaper tablet option to appeal to consumers now buying Amazon.com's (Nasdaq: AMZN) $199 Kindle Fire.

A Forrester Research report published yesterday (Tuesday) put the iPad's share of the tablet market at 73%, with no other rival having more than 5%.

Analyst estimates for 2012 iPad sales range from 55 million to 60 million. Apple has sold 55 million iPads since the product's debut in April 2010, winning over not just consumers but multiple markets.

"It's astonishing how fast the product has spread through business, education and health care," Needham & Co. analyst Charles Wolf told USA Today.

Sales of the iPad, along with the iPhone, have pleased Apple investors by pushing stock past $500 a share this year.

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A New Way to Play Apple Stock

Money Morning's Chief Investment Strategist Keith Fitz-Gerald joined Fox Business' "Varney & Co." to talk about the usual market pattern that follows Apple Inc.'s (Nasdaq: AAPL) product release. With the tech giant expected to release the latest iPad today, watch this clip to hear how Fitz-Gerald would play Apple… Loading the player …

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If I'm an Apple (Nasdaq: AAPL) Investor, I Want a Dividend

Now that their stock is up more than 20-fold in the last ten years, Apple Inc. (Nasdaq: AAPL) investors have had a wonderful ride.

On top of that the company has amassed a $97.5 billion cash hoard that would be the envy of any small nation.

However, as a dispassionate observer with experience of past such glorious valuations, I will tell you: If I were an Apple shareholder I'd want a cash dividend.

In fact, I think investors should certainly demand payout of at least three quarters of that cash hoard.

Simply put, a dividend is the best way for Apple shareholders to get real value out of their investment.

Here's why.

If Apple decided to pay out a $25 billion dividend per annum, allowing shareholders to benefit directly from the company's profits, it would be less likely to diversify unwisely in the future.

By receiving such a dividend, Apple shareholders would find their capital value preserved and their income increased.

However, the temptation of the $97.5 billion cash hoard would remain and management would still dream of the $100 billion acquisition that could revolutionize Apple's prospects.

That's why besides an annual dividend of $15-$20 billion (giving a 3.75%-5% yield on a $400 billion capitalization), shareholders should demand that the cash hoard itself, or the great bulk of it, be paid out to them, by a special dividend of maybe $100 per share.

By doing that, the diversification risk would be removed, and Apple would retain only enough earnings to guard against the onset of recession.

The Larger Case for an Apple Dividend

But that's not the only reason why Apple should do the right thing and start paying a dividend.

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The Three Innovations That Will Make Apple Inc. (Nasdaq: AAPL) the First $1 Trillion Company

Apple Inc. (Nasdaq: AAPL) has the potential to be the first company ever to reach $1 trillion in market capitalization.

And I believe it will in a relatively short order - but it won't be easy.

Apple took the most valuable company crown from Exxon Mobil Corp. (NYSE: XOM) in January after stunning December quarter results sent the stock soaring. Yesterday (Wednesday), AAPL's market cap crossed $500 billion.

As Apple's valuation has climbed, fueled by a five-year average annual growth rate of 59%, more people have started throwing the t-word around - as in trillion.

"Apple's a no-brainer to me to hit a $1 trillion-dollar market cap within the next year," James Altucher, managing director of Formula Capital, said on CNBC's "Fast Money" recently.

The record for market cap is just over $650 billion, achieved briefly by Microsoft Corp. (Nasdaq: MSFT) at the peak of the dotcom bubble in early 2000.

Only a handful of companies have made it to the $500 billion club, and membership has been fleeting.

The list includes Cisco Systems Inc. (Nasdaq: CSCO), Intel Corp. (Nasdaq: INTC) and General Electric Co. (NYSE: GE) - all during the 1999-2000 market peak. The last company to breach the $500 billion mark was Exxon Mobil in 1997.

One factor in Apple's favor is that it has risen to its current lofty levels not riding a bubble but despite a recession. And the markets for its existing products, such as the iPhone, the iPad and the Mac, still have room to grow.

"The reason Apple has been able to continue growing at a spectacular rate, even as its revenue base has surpassed $100 billion, is because it targets the world's biggest markets," Robert Cihra, an analyst at Evercore Partners, told The New York Times. "The simple fact is that they still have a small share of huge markets - single-digit shares in both PCs and mobile phones."

Naturally, getting to $1,000 a share and a $1 trillion market cap will require the addition of new sources of revenue, as well as sustaining growth in existing markets.

However, Apple already has head start with at least three cutting edge innovations...



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Apple's (Nasdaq: AAPL) Meteoric Rise is Distorting Everything

It happened almost a year ago, and it's happening again.

The meteoric rise in Apple Inc.'s (Nasdaq: AAPL) stock price is distorting the major benchmark indexes, including the Nasdaq-100, the Nasdaq Composite, and the S&P 500.

That is still true even though the Nasdaq executed a "special rebalancing" of its Nasdaq-100 tech-heavy index to reduce Apple's 20% weighting down to 12% last April.

With Apple's impact on the Nasdaq 100 now approaching 17% (that's greater than Google Inc. (Nasdaq: GOOG), Amazon.com Inc. (Nasdaq: AMZN) and Intel Corp. (Nasdaq: INTC)...combined), it's only a matter of time before another rebalancing takes a bite out of Apple's influence on this important index.

The problem isn't that Apple's share price has been so strong.

It's that investors may be unaware that the Nasdaq 100's rise and the Nasdaq Composite's jump to new 10-year highs wouldn't have been remotely possible without Apple's 60%+ gain since last summer.

Instead, investors need to understand Apple's impact on these market barometers and pay more attention to the core movements in those markets, not just the shine of a single stock.

Apple's Gigantic Impact

Apple's outsized impact on the Nasdaq-100 (NDX), which is a 100-stock index of the largest domestic and international non-financial companies listed on the Nasdaq, impacts in equal measure the popular $32 billion PowerShares QQQ Trust (Nasdaq: QQQ). The QQQ is an ETF based entirely on the NDX.

Apple's nearly 17% weighting in the NDX causes the NDX and the QQQ ETF to be closely correlated to Apple's stock whenever it makes a big move up or down.

The NDX (and by extension the QQQ ETF) is also a sub-set of the Nasdaq Composite Index.

The Nasdaq Composite Index (COMP) measures all of the domestic and international common stocks listed on The Nasdaq Stock Market. The COMP is one of the most widely followed and quoted major market indices.

Apple's weighting in the Nasdaq Composite is 10.6%. Thanks in no small part to this heavy weighting, the COMP is now approaching 3,000 - a level it hasn't seen since November 17, 2000.

But it's not just the tech-heavy NDX and COMP where Apple has an impact.

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Apple Inc. (Nasdaq:AAPL): When to Buy the World's Hottest Stock

Shares of Apple Inc. (Nasdaq: AAPL) are taking a breather, leaving many investors wondering if they've made an iBoo-Boo.

The hottest stock on the Nasdaq has fallen more than 4.6% as I write this since hitting a new intraday high of $526.29 on February 15, 2012.

Does that mean it's time to sell?

Perhaps, but first you should ask yourself why.

If you're a long-term investor, there's a lot to look forward to. Apple is much more than a brand; it's a lifestyle. People tattoo the company's iconic brand on their rear ends for crying out loud.

Always the innovator, Apple has barely scratched the surface with regard to new devices and has hardly tapped into ways to use them.

People line up thousands-deep to buy newer versions of the company's most basic products every year -whether they need them or not.

That is something no other tech company has figured out how to do.

Plus Apple's market share is growing overseas, with a particular emphasis on the Asian Rim.

In China alone, for instance, there's the potential for another 30-50 million iPhone sales in the next 12 months that could add another $4-6 in EPS to Apple's bottom line.

I remain convinced that Apple could be the world's first trillion-dollar company and I'm not alone in my thinking. Since I first voiced that highly controversial opinion a few years ago, many other firms and analysts have joined me.

How to Play the Short-Term Apple Top

But in the short term, Apple's chart now looks like a classic blow-off top- and technically speaking it is.

Last Wednesday, we saw the stock close near the lows of the day after making a quick run up and a high volume, hi-speed failure midday.

The chart tells the story.

Take a look

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