Why I Couldn’t Care Less About Apple’s Earnings Report

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Apple (NASDAQ:AAPL) reports earnings after the bell Tuesday, and there still is plenty of commentary — and lots of trading — on the news.

Me? I’ll check the numbers, but their report doesn’t change my opinion of Apple one bit.

Don’t get me wrong. Earnings are the lifeblood of a company’s growth — for most companies. Earnings are the clearest proof of a company’s operating success — how it’s creating profits, delivering value to shareholders and winning the battle against its competitors.

That’s why earnings growth, earnings momentum, earnings revisions and earnings surprises are four of the critical markers I use to identify stocks worth owning.

Stocks that score well on these metrics are worthy of your investment dollar. Stocks that can’t shine should be skipped without a second thought.

Let me tell you exactly why Apple’s earnings don’t matter.

Apple Is in a Whole Different League

Apple has had a remarkable run for over a decade now, churning out a steady succession of innovative products with unmatched customer loyalty. In the process of rolling out iMacs, iTunes, iPods, iPads and so many other exciting products, they’ve revolutionized industries from music and telecommunications to gaming and personal computing.

No wonder the stock has risen nearly 30-fold since 2004.

And regardless of what the actual numbers are today, Apple shows no sign of slowing down. Here’s just one example:

Do you realize that Apple can’t even sell its products in some retail stores in China anymore?

Thousands of Chinese consumers stood in line all night for the chance to nab the latest iPhone. It was such chaos that Apple has been forced to offer its new products for sale online only. And they haven’t even released a 4G phone yet.

But the iPhone 4S has certainly been a hit.

The iPhone 4S is now available in over 90 countries, making this the fastest iPhone rollout ever. With this kind of instant success, it’s no wonder consumer groups expect global sales of consumer electronics to top $1 trillion in 2012.

The Hits Keep Coming

And that’s just one of Apple’s products. This company is also the reigning champ of tablet sales. Here’s some perspective for you:

Excluding Apple’s tablets, the U.S. tablet market saw sales of 1.2 million units from January through October of 2011. But in just the last quarter, Apple alone moved 11.1 million iPads — almost 10 times as many as the entire market in that nine-month period.

I could go on and on about Apple’s products, its expansion into new countries, the companies it has bought up for its upcoming gadgets or its partnerships with companies like Target (NYSE:TGT) to place mini-Apple stores inside the discount retailer’s big boxes.

But I won’t.

When Apple reports earnings, it won’t make one bit of difference to me if they beat the $10.08 a share profit expectations or hit the $38.85 billion sales target. It won’t matter to me if shares drop a bit or rise on the earnings announcement.

This company is going to continue to dominate the consumer electronics industry for years to come, thanks to superior customer focus, innovative engineers and designers and a truly awesome cash hoard they’ve amassed.

All those advantages have created the superior machine that is Apple, which is reflected not just in earnings, but also in operating margins, cash flow, buying pressure and all the other signals I look for.

So I, for one, would be a buyer of shares of this phenomenal company now, next month, next quarter and throughout 2012 — no matter what we hear from Apple.


Article printed from InvestorPlace Media, https://investorplace.com/2012/01/why-i-could-care-less-about-apples-earnings-aapl/.

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