After I crunch the new quarter's data I don't see anything detrimental to its fundamentals. Rather it should be a good time to load some shares after the pullback.
If you compare year over year quarter results there is no doubt it's a good quarter. How about comparing this quarter to all previous five quarters? Most of the ratios are comparable if not better. Indeed the gross margin is the lowest. However, I assume it's natural for Apple to have low gross margin as its product mix shifting to Iphone/Ipad, the low margin products. And even with the low gross margin Apple still manages to have great profit margin. How did Apple do it?
Certainly Apple controlled operating expense well. SG&A is in the lowest levels among the six quarters. In addition, R&D expense is less percentage wise but increases in real amount. Now let's look at the efficiency ratios (those turnover ratios). Asset turnover and AR turnover are good. But inventory turnover slows down in 2010's three quarters. Why is that? Well, as the company released two new products this year it shouldn't be a surprise that the inventory management can be a little "sluggish". The working capital management is still in great shape and so are the liquidity ratios.
In summary, a good quarter for AAPL. Product mix is changing investors have to adapt to new cost structure. Again, I feel it's an opportunity to own Apple rather than to sell it. (Pure personal opinion not trading suggestions) Well, after all, the stock has a decent run before the ER it won't hurt to have a temporary pullback. However be aware of the general market condition as it has awesome runs for past two months. There might be an correction due.
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