Thursday, April 23, 2009

Apple Gross Margins

The Apple quarter reported last night was a beauty. A terrible economy, an ill CEO, a resurgent RIMM - none of these could derail Apple from having a good quarter. 2-year chart for Apple above left.

Going forward there is a new iPhone coming in June and some optimism (rightly) that a better tone to the economy and high-end consumer will enable Mac sales to re accelerate. Those leaning negative are pointing to gross margins, which were so-good-that-they-have-to-get-worse. Predicting Apple margins has never been easy so I'm not going to try, but I don't think they are getting enough credit for their performance right now.

Apple has outperformed the market by a lot this year, but this is an environment that has room for even fewer winners than usual. Apple vs. the S&P 500 YTD above right. The company is executing brilliantly and looks hard to stop, which makes for a higher multiple.


Any time I put more than one chart or picture in a post, the formatting gets screwed up. The guys at Google must be really busy.


It looks like an increasing number of peole want to declare a bottom in housing. Bidding Wars on Foreclosures is the WSJ story today. I think the bottom is in but I'm no expert.

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