Everything Apple Investors Must Know Now: Weekly Cheat Sheet

Here’s your Cheat Sheet to all the week’s important news for Apple investors…

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Monday

Apple’s (NASDAQ:AAPL) nightmares continued on Monday as the stock dropped 2.49 percent to $442.32 even though there wasn’t a particularly obvious negative pull for it. Here are some of the top stories related to the company through the day:

Dead Money?

Gunderson Capital Management chief executive Bill Gunderson provided the main pessimistic view on Monday, writing that the company’s stock was dead money for now and recommending staying out of it. The investment specialist believes Apple remains in a downtrend and is still searching for its bottom. According to Gunderson, while in the past Apple’s stock had always recovered after a bout of profit taking and marched on to new highs, this time is turning out to be different. “Even though Apple’s three-, five- and 10-year performance is still superior … short-term performance record has been shattered,” Gunderson wrote in an analysis for MarketWatch. “The stock’s short-term performance started turning sour back in October of last year and has only gotten worse since then.”

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Gunderson does not deny that there are some clear positives and the stock looks good from a valuation point of view. However, he adds, the company’s earnings estimates and price target have come down drastically in the last few months and earnings momentum is contracting… (Read more)

Mobile Internet Winners 

Apple and Samsung (SSNLF.PK) have finally beaten Nokia (NYSE:NOK) in global Internet usage from smartphones, with the iPhone maker topping the charts for the first time ever. More than a quarter of global Internet traffic on mobile devices went through Apple devices in January, according to data from web analytics company StatCounter. Nokia, which led in January 2012 with 37.67 percent, fell to third place. However, Apple’s share of mobile Internet traffic actually dropped from 28.67 percent in January last year to 25.86 percent this year. Samsung’s share grew from 14.84 percent to 22.69 percent, while Nokia’s share dropped from 37.67 percent to 22.15 percent. The regional divisions were also sobering for Apple… (Read more)

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Privacy Win For Apple

Apple and other Internet-based sellers of music and programs can ask for personal information, such as addresses and phone numbers, from users, according to a ruling by the California Supreme Court. The court, in a 4 to 3 ruling on Monday, said these companies were not covered by a 22-year-old consumer law that stops businesses from collecting such information. That law, the Song-Beverly Credit Card Act, prevents businesses in California from collecting information as a condition of accepting credit card payments. However, according to the court, Apple and other Internet retailers don’t have the same safeguards against fraud as traditional stores and hence need this information for verification purposes. (Read more)

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Tuesday

Apple (NASDAQ:AAPL) finally put an end to its four-day run downward, gaining 3.52 percent to $457.87 on Tuesday despite some worrying reports for the company. Here are the main stories that swirled around it on the day:

iPhone Trouble in Brazil

Apple may have officially lost the right to use the iPhone name to sell its smartphone in Brazil, but the company that owns it exclusively is still open to talks. A local newspaper reported that the Brazilian Institute for Industrial Property had rejected Apple’s request to regain the naming right from electronics firm IGB Eletrônica SA, or Gradiente, which had originally asked for the trademark back in 2000. According to Folha de S.Paulo newspaper, the decision will be announced on February 13. But the chairman of IGB told Bloomberg that while he had not received any ruling information yet, his company would consider selling the naming rights to Apple. “We’re open to a dialogue for anything, anytime,” Eugênio Emilio Staub said on Tuesday. “We’re not radicals.”

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Gradiente had earlier warned it may go after Apple for copyright infringement, saying it would take “all the measures used by companies around the world” to preserve its intellectual property rights. “The two brands can’t coexist in the market,” Staub told The Wall Street Journal in December. “It’s up to Apple to make a move”… (Read more)

Plea to Shareholders

In a move divergent from its previous positions vis-à-vis shareholder responsibility, Apple has enlisted pension fund CalPERS to help carry through investor voting rights reforms at its annual general meeting later this month. CalPERS, or the California Public Employees’ Retirement System, is known as the largest public pension fund in the country and own a 0.25 percent stake in Apple for a total worth of $1.1 billion.

However, the fund has been a fairly fierce critic of Apple’s corporate governance policies, while the iPhone maker has opposed requests of greater shareholder responsibility from it, Financial Times said. But Apple is now hoping to use the fund’s sway to lobby other big shareholders on the vote to change the way its board directors are elected… (Read more)

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What Apple Needs

Sterne Agee’s Shaw Wu may be a strong Apple bull, but with the company facing growth questions, the analyst admitted that large-screen Google (NASDAQ:GOOG) Android phones had been a bigger success than expected. According to Wu, Apple will leave itself in a bad place if it did not launch a larger-sized iPhone sometime soon, especially considering that supply chain data suggested Samsung (SSNLF.PK) was planning to release the Galaxy S4 in April with a five-inch screen. “We believe Apple is leaving money on the table by not participating in larger touchscreen form factors,” Wu wrote in a note to investors on Tuesday.  He added that he did not believe investors’ deep worries about Apple’s future were likely to come true, but said the company did need a spark… (Read more)

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Wednesday

After staying in the green for most of the day on Wednesday, Apple (NASDAQ:AAPL) disappointed its investors once again by closing 0.11 percent down at $457.35. While some of the early trading activity was attributed to positive talk around the company, and more than one report suggested the company’s products was doing well, the markets continued their recent run of dislike for the stock. Here’s a cheat sheet to the top stories surrounding the company on the day…

Rivals and Profit Monsters

Apple and Samsung (SSNLF.PK) together made up 101 percent of all mobile phone profits in the last quarter of 2012, and the iPhone maker was the overwhelming winner with a commanding 72 percent share. Samsung accounted for 29 percent, according to research from Canaccord Genuity. For the full year, Apple’s $35.903 billion in operating income from mobile devices accounted for 69 percent of the total profits, while Samsung came in at 34 percent. The higher than 100 percent share for the two rivals was because Nokia’s (NYSE:NOK) losses gave it a negative 2 percent profit, while Motorola (NASDAQ:GOOG) and Sony (NYSE:SNE) together accounted for negative 1 percent.

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“Given the current competitive dynamics, we believe Apple and Samsung will maintain dominant value share during [the first quarter of 2013] with share gains for Samsung versus Apple expected,” Canaccord Genuity analyst T. Michael Walkley said. The gains for Samsung are expected because of the possibility of the launch of the Galaxy S4 handset at the end of March… (Read more)

Apple is the PC King

According to fourth-quarter data from Canalys, one in every three PCs shipped globally in the three months was a tablet, and Apple’s iPad accounted for just under half of that sector. Overall, one in every six PCs sold was an iPad, and with Mac sales taken into account, Apple was the top PC vendor in the world. Apple shipped 27 million units of Macs and iPads in the fourth quarter for a 20.1 percent share of the overall PC market, Canalys said.

Hewlett-Packard (NYSE:HPQ) came second with 15 million units and an 11.2 percent share, while Lenovo, in third place, was just 200,000 units behind it. Samsung shipped 11.7 million units for a 9 percent share of the overall market, with most of its sales coming from the Galaxy Tab line. Dell (NASDAQ:DELL), which is soon going private, rounded out the top five, though it saw a 19 percent drop in shipments… (Read more)

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Ecosystem Landmark

Apple’s ecosystem, touted as one of the company’s biggest strengths, keeps growing bigger. On Wednesday, the company announced a new record for its iTunes Store, with the music and media program surpassing the 25-billion mark in song purchases. Apple introduced the store in April 2003. The store — available on Macs, PCs, iPhones, iPads, and iPod touch players, has a catalog of more than 26 million songs and is available in 119 countries. The company announced at the end of December that its iTunes Store had launched in 56 new markets, bringing the total to 119. In addition, the company’s App Store has about 775,000 apps and has seen more than 40 billion downloads since it first opened… (Read more)

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Thursday

The news of a lawsuit against Apple (NASDAQ:AAPL) did not deter its investors from giving the company one of its better recent days as the stock rose 2.98 percent on Thursday to close at $468.25. Perhaps it’s got something to do with the expectation that this development may actually move Apple into some action. Here is a Cheat Sheet to the top Apple stories from the day:

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Apple Has This To Say

Apple released a statement on Thursday afternoon, saying the company’s management and board were currently in active talks about returning cash to its shareholders. The iPhone maker specifically mentioned Greenlight Capital, the David Einhorn fund that filed a lawsuit against the company over its stock behavior earlier in the day. Apple said it would thoroughly evaluate Greenlight’s recommendation to issue some form of preferred stock. It also explained that the proposal in its AGM proxy was designed not to get rid of preferred stock completely, but give shareholders the option to vote on such a move.

“Contrary to Greenlight’s statements, adoption of Proposal #2 would not prevent the issuance of preferred stock,” the statement read. “Currently, Apple’s articles of incorporation provide for the issuance of ‘blank check’ preferred stock by the Board of Directors without shareholder approval. If Proposal #2 is adopted, our shareholders would have the right to approve the issuance of preferred stock…” (Read more)

What Does Einhorn Want?

David Einhorn’s Greenlight Capital fund sued Apple in an attempt to block the company from adopting a measure that would enable it to eliminate preferred stock. Einhorn is also hoping to start an investor revolt against the iPhone maker, saying the company needed to be more active in offering its shareholders more value for their investments. Apple has about $137.1 billion in cash, according to its latest earning report released in January, and according to Einhorn, that equates to about $145 per share. While Apple did announce the start of a dividend last year and also buys back shares, Einhorn said shareholders would like to receive preferred stock with a 4 percent yield… (Read more)

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The iPhone Keeps Growing

Apple did receive some good news Thursday. According to a new report, Apple continues to be the top U.S. smartphone manufacturer. The iPhone maker kept up its lead over Samsung (SSNLF.PK) in the fourth quarter of last year, in fact growing its share to 36.3 percent from 34.3 percent at the end of the September quarter, comScore said. Samsung also grew, moving up to 21 percent from 18.7 percent in the previous quarter. Both HTC and Google (NASDAQ:GOOG) unit Motorola, in third and fourth spots, respectively, saw their market shares decline. HTC fell from a 12 percent share in September to 10.2 percent, while Motorola edged down from 9.8 percent to 9.1 percent. LG, in fifth place, moved up from 6.6 percent to 7.1 percent. Meanwhile, Google’s Android continued its hold on the smartphone operating system portion of the market… (Read more)

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Friday

Apple (NASDAQ:AAPL) rose 1.44 percent on Friday to end the week at $474.98 and register a total 4-percent gain since announcing on Thursday afternoon that it was considering increasing its dividend and stock buyback funds. While most news on Friday centered around various reactions to Apple’s statement, there was also an important legal development for the company. Here are the top stories for Apple on the day:

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Apple’s Lonely Battle

Apple is now the only one left fighting with the U.S. Justice Department in the e-book antitrust case after publisher Macmillan reached a settlement with the agency on Friday. Macmillan was the last of five major publishers to settle the suit filed by the Justice Department last April, leaving the iPhone maker as the only remaining defendant in the case scheduled to start hearing in June.

The DoJ has alleged that five publishers and Apple colluded to raise e-book prices from Amazon.com’s (NASDAQ:AMZN) standard $9.99 price. According to the allegations, prices of bestsellers rose to $12.99 and $14.99 after Apple stepped in, thus hurting consumer interests. The publishers and Apple have denied the allegations. According to Friday’s settlement, Macmillan will have to allow e-book retailers to discount its titles within three business days of agreeing to the settlement, even if it has not made new contracts.

Macmillan chief executive John Sargent said in a statement that his company was forced to settle “because the potential penalties became too high to risk” and that the settlement did not include an admission of guilt… (Read more)

Gifts On Way?

Shareholders can look forward to getting some cash presents from Apple in the coming days, according to Barclays Capital analyst Ben Reitzes. Reitzes wrote in a note to investors on Friday that with investor pressure having gone up on the company in the recent days, and peaking with David Einhorn’s statement on Thursday, the company was ready to open its safe. In addition, with the stock moving downward over the last few months, Apple had been spurred into additional urgency.

According to the analyst, Apple was likely to increase its cash-return program — started last year at $45 billion to be paid over three years — by between 30 percent and 40 percent. The announcement could be made around or on Apple’s annual shareholder meeting takes scheduled for February 27, Reitzes added… (Read more)

Domestic Cash Power

While bringing its large amounts of overseas cash back to the U.S. in order to return more money to shareholders will be costly, Apple has enough in the bank at home to increase dividend, according to RBC Capital Markets’ Amit Daryanani. According to the analyst, about 70 percent of Apple’s cash balance was held overseas, which meant that at a corporate repatriation rate of 35 percent, the company stood to lose about $33 billion.

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While such a scenario was possibly unacceptable for Apple, he pointed out that the iPhone maker also had $43 billion in cash domestically. In addition, the company was expected to generate another $45 billion in free cash flow this year, giving it enough room to return additional cash to investors… (Read more)

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