An analysis of non-iPhone cash flow

Many people think Apple is just the iPhone and nothing else matters. I recently wrote a Seeking Alpha blog post separating Apple into iPhone and non-iPhone segments. In my mind it shows Apple is currently undervalued. 

What’s astonishing is that Google generates less operating cash flow than Apple’s non-iPhone segment, but due to growing faster is valued at a much larger premium than Apple’s non-iPhone segment. This non-iPhone segment includes Macs, iPads, App Store revenue and everything else. I expect this segment to grow quite rapidly over the coming years.

Apple reports earnings next week and my feeling is Apple goes down on the news as a classic buy the rumor sells the news event. If Apple goes down by any significant degree of 10% or more I will be looking to buy. The next two months don’t look kind for the markets. It is for that hesitation I am in cash waiting for a better entry point. This is balanced by the fact October through January is Apple’s strongest time to gain price appreciation. 

We’ll know more when Apple’s earnings and Socrates are released. 

I welcome any feedback here or on Seeking Alpha.

Live long and prosper.

Vijay @ smilingdad

Published by smilingdad

My story is one of tragedy and redemption. We've made many mistakes along the way regarding our money. Our goal here is to show you how to take care of your money life long, and as much as we can, help the Earth along the way. I call it sustainable personal finance and ethical capitalism. Currently, I am a part time writer for Cleantechnica and part-time licensed financial professional, along with being a full-time dad.

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