AAPL - Apple Inc.

NasdaqGS - NasdaqGS Real-time price. Currency in USD
+4.57 (+1.59%)
At close: 4:00PM EST

290.30 -2.35 (-0.80%)
After hours: 7:59PM EST

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Previous close288.08
Bid291.25 x 800
Ask290.25 x 800
Day's range286.50 - 297.88
52-week range169.50 - 327.85
Avg. volume31,205,426
Market cap1.28T
Beta (5Y monthly)1.28
PE ratio (TTM)23.24
EPS (TTM)12.60
Earnings date27 Apr 2020 - 03 May 2020
Forward dividend & yield3.08 (1.07%)
Ex-dividend date06 Feb 2020
1y target est333.31
  • Apple to begin online sales in India this year, open first retail store in 2021

    Apple to begin online sales in India this year, open first retail store in 2021

    For a decade, Apple has solely relied on third-party sellers, stores and marketplaces to sell its products in India. At the company's annual shareholder meeting Wednesday, chief executive Tim Cook told investors that Apple will open its online store in India, the world's second largest smartphone market, at some point this year, and set up its first flagship brick-and-mortar store next year. TechCrunch reported last month that Apple was planning to open its online store in Q3 this year and was unlikely to be able to have its brick-and-mortar store ready in the country this year.

  • Microsoft Joins Apple, HP in Scrapping Outlooks on Virus

    Microsoft Joins Apple, HP in Scrapping Outlooks on Virus

    (Bloomberg) -- Microsoft Corp. became the latest tech giant to reduce its quarterly outlook based on the outbreak of a novel coronavirus that’s slowing production of computers and crimping sales of an array of consumer services and electronics.In a statement Wednesday, the company said it doesn’t expect to meet earlier guidance for fiscal third-quarter revenue in the Windows personal-computer software and Surface device business because the supply chain is returning to normal at a slower pace than expected. Last month, Microsoft gave a wider-than-usual sales target -- $10.75 billion to $11.15 billion -- for that division, citing uncertainty related to the spread of the deadly respiratory virus.The world’s largest software maker joins iPhone maker Apple Inc. and PC company HP Inc. in cutting estimates because of supply-chain disruptions related to the virus, known as Covid-19. Merchants who sell on Amazon.com Inc. also are trimming ad spending on the e-commerce giant’s marketplace, seeking to moderate demand amid worries they may run out of inventory of Chinese-made goods. Questions about the virus’ economic ripples had already sent the S&P 500 Index down by 6.6% this week; Microsoft’s acknowledgment that the PC market is being hit reinforces investor concerns about broader consequences, said Dan Ives, an analyst at Wedbush Securities.“It fans the flames on Corona worries,” Ives said. “Apple and Microsoft now confirm the negative impact the Street had feared.”In recent days, anxiety has mounted about the spread of the virus outside of China, where it originated. For the first time, more cases were reported in countries other than China in the past 24 hours, the World Health Organization said late Wednesday, a significant development as new cases spread around the globe, with South Korea, Italy and Iran particularly hard hit. Globally 2,771 have died and 81,317 people have been infected.As component makers and tech-gadget assembly companies in China continue to face production slowdowns due to quarantines and shuttered factories, U.S. technology companies are reported to be scrambling for alternatives. Microsoft and Alphabet Inc.’s Google are looking at manufacturing facilities in Vietnam and Thailand, the Nikkei Asian Review reported Wednesday.Microsoft shares declined about 2% in late trading following the announcement. The stock has fallen in four of the last five trading sessions, along with the broader market, on concerns that the spreading health crisis could hurt the global economy and the technology sector. The shares had been trading at all-time highs earlier this month. Shares of Intel Corp., the biggest PC chipmaker, and rival Advanced Micro Devices Inc. also fell in extended trading, as did PC makers Dell Technologies Inc. and HP. Dell reports earnings Thursday.The reduced forecasts come as Covid-19’s impact spreads through global companies in a range of industries. Booking Holdings Inc. on Wednesday said room nights booked would drop 5% to 10% in the first quarter, compared with analysts’ estimates for an increase of 5%. The company said cancellations are rising.For Microsoft, demand for Windows operating-system software is strong and has been in line with the company’s forecasts, according to the statement. The rest of the company’s outlook for the current quarter remains unchanged. On average, analysts were predicting total sales of $34.6 billion for the period ending in March, according to estimates gathered by Bloomberg. The More Personal Computing unit typically generates more than a third of Microsoft’s annual sales.Microsoft will have to account for supply issues with its Surface devices and lost software sales from Windows on PCs made by other manufacturers who may be facing the same production and parts challenges in China. The Redmond, Washington-based company is also preparing to release a new generation of Xbox video-game consoles in the fall, and will need to work through setting the final production lines and then building up inventory ahead of that release, a process that could be affected by lingering shutdowns in China.The spread of the virus outside of China also raises the chances of impact of work shutdowns, quarantines, store closures, and conference and meeting cancellations in other countries where technology and other global firms have a significant presence.To contact the reporter on this story: Dina Bass in Seattle at dbass2@bloomberg.netTo contact the editors responsible for this story: Jillian Ward at jward56@bloomberg.net, Andrew PollackFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Coronavirus Fears: Should You Be Investing or Playing It Safe?

    Coronavirus Fears: Should You Be Investing or Playing It Safe?

    If you have been talking anything about the coronavirus, then this is the episode for you. We touch on every facet of the subject and give you a deep dive into how investors could be navigating this volatile market.

  • Peloton Could See Bump From At-Home Workouts on Virus Concerns

    Peloton Could See Bump From At-Home Workouts on Virus Concerns

    (Bloomberg) -- Americans have so far largely been spared measures taken in China and elsewhere to contain the deadly coronavirus, keeping thousands of healthy people homebound and left to binge-streaming entertainment to ward off boredom. But that could soon change, and home-exercise company Peloton Interactive Inc. may be well-placed to benefit from restless workout fans.This week the U.S. Centers for Disease Control and Prevention warned Americans to prepare for a coronavirus outbreak at home that could lead to significant disruptions of daily life, including school closings, cancellations of sporting events, concerts and business meetings.“We believe certain U.S. consumers will be less comfortable over time going to their gym and more likely to order a Peloton bike to stay home,” Laura Martin, an analyst at Needham and Co., wrote in a note to investors Tuesday. “This may drive higher unit sales and subscription revenue in 2020 than are currently in our estimates.”A few Chinese gym companies are seeing a similar reaction. Some analysts say the virus may provoke a moment when people learn to get comfortable doing a lot more at home and keep up the newfound habits after life returns to normal.New York-based Peloton, which makes internet-connected exercise equipment, also has an app that people can buy as a monthly subscription. While its workouts have been available on phones and tablets for some time, the company recently began offering an app for the Apple Watch, as well as the ability to stream classes on Amazon.com Inc.’s Fire TV.In its most recent earnings report, Peloton said it added 149,000 new subscribers during the quarter, bringing its total to 712,000. The company estimated it will have as many as 930,000 connected fitness subscribers this year. Connected fitness subscribers are people who own a piece of Peloton hardware, like the bike or treadmill, and pay a monthly subscription to access digital workouts. It’s a more lucrative category than people who pay for its app alone. If the Covid-19 virus, as it’s officially known, does lead to more in-home workouts, the figures could be on the high end or even above that range.Peloton shares were up about 7% on Wednesday, while the broader markets were generally down, having slid more than 6% over the prior two days. In China, there’s evidence that demand for at-home workouts is increasing. Apps like Fit.me and 7 Minute Workout, which both offer workouts in the home, have been rising in rankings of top health and fitness apps in the region, according to data tracking site SimilarWeb. Meanwhile Nike Inc.’s Run Club, used to track outdoor activity, has fallen. In the U.S., Aaptiv Inc., Mirror, and Nike’s Training Club could stand to benefit as well if U.S. consumers opt to skip the gym and get their sweat on at home instead.To contact the reporter on this story: Julie Verhage in New York at jverhage2@bloomberg.netTo contact the editors responsible for this story: Molly Schuetz at mschuetz9@bloomberg.net, Andrew PollackFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Apple to open first retail store in India next year, Tim Cook says

    Apple to open first retail store in India next year, Tim Cook says

    CUPERTINO, California - (Reuters) - Apple Inc will open its first physical retail store in India in 2021, Chief Executive Tim Cook said on Wednesday. Responding to a question from a shareholder at Apple's annual shareholder meeting in Cupertino, California about the company's plans for India, Cook said Apple would start selling its products online in the country this year and will open its first Apple-branded store there next year.

  • Bloomberg

    Apple’s Tim Cook Calls Coronavirus a ‘Challenge’ at Shareholder Talk

    (Bloomberg) -- Apple Inc. Chief Executive Officer Tim Cook called the coronavirus a “challenge” for the iPhone maker during a pep talk for shareholders at the company’s annual meeting.The effects of the virus, which have closed factories and stores throughout China, pose significant issues for the technology giant. Apple produces hundreds of millions of devices each year in China. Earlier this month, the company said it wouldn’t meet its revenue forecast of more $63 billion for the current quarter, citing iPhone supply constraints and lost retail sales in China.Apple has since re-opened about 30 of its 42 stores in China. Suppliers and mass assembly partners are also slowly coming back up to speed, but some analysts have said the fallout could spill into the quarter ending in June.In prepared remarks Wednesday at Apple’s shareholder meeting at Cupertino, California, Cook said annual revenue from wearables such as the AirPods and Apple Watch compares with that of Marriott International Inc. plus Visa Inc. -- more than $40 billion. Apple reported $10 billion in fiscal first-quarter revenue for its wearables, home and accessories unit.Answering questions from the audience, Cook said for the first time that Apple would open its online store in India this year, with the first retail stores opening in the country in 2021.He also made his first public comments about the company’s rejection of the U.S. government’s request to unlock iPhones belonging to the shooter behind the December 2019 attack that killed three people in Pensacola, Florida. “Don’t think we have something that we’re not giving,” he said, adding that Apple wouldn’t create a backdoor to break into its devices.On a much lighter note, Cook was asked why the company didn’t acquire the rights to the show “Friends” for its TV+ streaming service. The CEO said the company is focused on developing original shows rather than buying old offerings.Cook’s comments at shareholder meetings sometimes can hint at future products. At the 2019 meeting, Cook said there was “long, great road map of fantastic” AirPods ahead. New AirPods launched just weeks later, followed by the AirPods Pro in October.The top Apple executive didn’t specify any future products, but the company is working on new iPhones with 5G for later this year, Bloomberg News has reported. It’s also planning to launch a virtual-reality headset as early as 2021. It’s unclear whether those plans may be affected by the coronavirus outbreak.Shareholders re-elected Apple’s board, which includes Cook and former U.S. Vice President Al Gore.To contact the reporter on this story: Mark Gurman in Los Angeles at mgurman1@bloomberg.netTo contact the editors responsible for this story: Tom Giles at tgiles5@bloomberg.net, Andrew Pollack, Mark MilianFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Amazon Merchants Spooked by Coronavirus Fallout Curtail Ad Spending

    Amazon Merchants Spooked by Coronavirus Fallout Curtail Ad Spending

    (Bloomberg) -- Chuck Gregorich, who sells China-made patio furniture on Amazon.com Inc., expects to lose as much as $2 million in sales this year due to factory closings and other coronavirus-related slowdowns. So he’s cutting his ad spending on Amazon and thinking about raising prices to avoid running out of inventory. The sudden shift in sales tactics by merchants like Gregorich threatens Amazon’s fastest-growing and profitable revenue source.“If we’re going to run out, why not run out at full price,” he says. “We have to make sure the sales we have are as profitable as they can be."Amazon merchants spent about 6% less on advertising over the past two weeks than they did a year ago, says Daniel Knijnik, who runs Quartile Digital, a New York firm that helps manage Amazon advertising for 2,300 brands selling goods on the site. Many of them are small outfits forced to react more quickly than big brands selling to the likes of Walmart Inc. and Target Corp., he says, because they lack the inventory stockpiles and alternative suppliers their larger counterparts can draw on.Amazon’s advertising sales are a small piece of overall revenue, but they help the company offset the huge costs of storing and shipping millions of products. In the holiday quarter, what Amazon calls "other" revenue—most of which is advertising—totaled $4.78 billion, up 41% from a year earlier.Like many of its tech industry peers, Amazon started 2020 predicting strong sales growth. Now mounting fears of a pandemic and the related economic fallout has put those rosy projections in question. Amazon’s shares had dipped 5.9% by the Tuesday close and were up less than 1% at midday Wednesday. The falloff in advertising could be a harbinger of worse news to come.Amazon last month forecast sales of $69 billion to $73 billion in the current quarter and has not adjusted that outlook in response to the coronavirus. Apple Inc. warned that it is likely to miss its sales forecast for the current quarter due to the outbreak, which disrupted smartphone production and forced store closings in China.  “We are monitoring developments related to COVID-19 and taking appropriate steps as needed,” Amazon said in an email, using the official name for the virus.The company is taking other measures to soften any virus impact for smaller sellers. As previously reported by Business Insider, Amazon on Feb. 7 advised merchants that they could put their accounts in “vacation status” to avoid getting penalized by its algorithms if they suspected items would run out of stock. It also instructed merchants to cancel any customer orders they would not be able to fulfill.“If your performance metrics have been impacted by this event, please include a brief description of how your business was impacted when you respond to the relevant performance notification,” Amazon said in a notice. “We will consider this unforeseen event when we evaluate your account’s recent performance.”More than half of the items sold on Amazon come from independent merchants like Gregorich, who pay the company a commission only when shoppers buy their goods. That puts Amazon in a very different position than traditional retailers when reacting to supply-chain disruptions. Walmart and Target remain in constant contact with their wholesale suppliers about postponing delivery deadlines and finding alternative sources for products to keep shelves stocked. Amazon has those relationships as well, but has less direct contact with smaller merchants.Its marketplace is largely managed by machine, with algorithms deciding in real time which products people see. Prices, consumer feedback, advertising and the speed of delivery all factor into the calculation. Amazon’s algorithms can punish merchants whose products sell out by making it harder for shoppers to find their wares, giving sellers an incentive to protect their inventory until they can replenish it. Cutting ad spending is the easiest lever for them to pull.“We have reduced our ad spend and have identified the stock level where we’ll increase prices to slow down the rate of sale even more,” says Jerry Kavesh, a Seattle merchant who sells cowboy boots and hats on the site.Mark Looram, managing director of GTO Limited, which oversees factory operations in China and the Asia Pacific region for big importers, expects prices for China-made products to shoot up on Amazon more quickly than at competing retailers that have more control. “One of the major differences with Amazon sellers is that they control their pricing and can increase or decrease depending on market conditions,” he says.Price spikes can attract the attention of regulators. In 2017, after back-to-back hurricanes struck Florida and Texas, Amazon fielded complaints of price-gouging on bottled water.  In fact, the high price reflected the expense of quickly shipping a heavy case of water across the country when local supplies were depleted. It was an example of how Amazon’s machines, designed to help match supply with demand, lack the judgment of a human touch.So far, there haven’t been reports of virus-related shortages of essentials in the U.S. Instead, merchants are facing delays in replenishing inventory of things like dog treats, wine refrigerators and patio umbrellas. With no clear answers about when China will be back to full production, sellers are trying to stretch out what they have until new supplies roll in. Even with those adjustments, some merchants have already run out of stock.“I have clients in various categories that are getting crushed because of the coronavirus,” says Dan Brownsher, who runs Channel Key, a Las Vegas e-commerce consulting business with more than 50 customers who sell products on Amazon. “What was supposed to ship in February or March now won’t be shipped until April. We have items out of stock that won’t be back until April.”Virus-related disruptions will be most immediate to those selling spring and summer seasonal goods like inflatable pool toys and patio umbrellas, which could push any impact on Amazon into the second quarter.Gregorich might have to hold off introducing a new line of patio furniture until next year. He ordered 14 containers of products from a Chinese factory, which recently refunded his deposit because it can’t complete the order in time. He’s keeping in touch with the factory in case it can make part of the order before the outdoor furniture selling season ends in the summer.“We told the factory to let us know where they are and maybe get a partial order in the summer and still make some sales so we don't miss the whole season,” he says. “We’re going to miss that product this year.”(Updates shares. A previous version of this story was corrected to show that the note Amazon sent to merchants was previously reported by Business Insider.)To contact the author of this story: Spencer Soper in Seattle at ssoper@bloomberg.netTo contact the editor responsible for this story: Robin Ajello at rajello@bloomberg.net, Andrew PollackFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Bloomberg

    Disney's Next $180 Billion Won't Come Easy

    (Bloomberg Opinion) -- The streaming wars. The weaker box-office lineup. The economic trepidation. The coronavirus. All of that is taking Walt Disney Co. on a roller-coaster ride this year, and it makes sense that Bob Iger would rather watch from the safety of the ground than be strapped in the front seat. He’s earned it. Iger, who has been CEO of Disney since 2005, startled investors on Tuesday with his abrupt decision to step down, a move that wasn’t expected to happen until the end of next year. As soon as the subject line of the email from Disney appeared in my inbox at 4:06 pm on Tuesday, a cascade of negative thoughts raced through my mind: Is Iger sick? Is another Hollywood MeToo moment about to unfold? Was the company at risk of losing yet another successor candidate whose patience was tested by Iger’s continuously postponed retirement? The email went on to say that Iger is staying on only as chairman for his remaining 22 months, while Bob Chapek has stepped into the more hands-on and culpable role of CEO. Oh, to be a fly on the wall during those boardroom discussions, the only people who know why exactly the succession plans were sped up.But as the shock from the announcement subsides, and as financial markets remain in tumult, Iger’s unspoken logic behind the move — or at least part of it — makes more sense. Disney has a difficult year ahead, and the stock-market rout adds to the pressure. Why should Iger’s legacy be marked by such a tense final chapter? “It’s the right time to transition to a new CEO,” he said Tuesday, and maybe it really was. Iger signaled that in his remaining time at Disney, he’ll have a more amorphous role that involves working on the creative side to make sure he leaves it in top shape. But strategically, he’s done what he set out to, assembling what he thinks are the right collection of assets, and handing them off to Chapek.Iger, though himself a controversial CEO pick at the time, ended up reigniting Disney’s imagination and sense of magic, restoring a 97-year-old company to its heyday — better, even — accomplishing it all with his reputation for integrity intact. Disney’s market value increased by some $180 billion during his tenure, beating peers and the broader market. His acquisitions of Pixar, Marvel and Lucasfilm were a trifecta of genius, bringing more beloved characters into the Disney universe, elevating the company’s movie-making business, expanding its fan base and setting it up for later success in the streaming-TV era. Iger also expanded Disney’s theme parks and amplified their experience of being transported into a world of childlike wonderment through years of careful investment, capped by the 2016 opening of Shanghai Disney Resort and last year’s opening of the “Star Wars”-themed Galaxy’s Edge. Also last year, Disney delivered the highest-grossing film of all time, Marvel’s “Avengers: Endgame.”But just as I wrote then, as “Endgame” headed for a record $2.8 billion in global ticket sales and after his string of successes, Iger would have a hard time outdoing himself. Disney’s scheduled box-office releases for 2020 have much less of a wow factor than last year’s, with “Avatar 2” pushed back to December 2021 and the next “Star Wars” film not coming until 2022. Then there’s the coronavirus. Disney, with its parks, cruise ships, hotels and movie business, will undoubtedly feel some painful effects of the potential pandemic. The Shanghai park, which Iger saw as the capstone project of his career, has already been closed for a month because of the flu-like virus. Earlier on Tuesday, the Centers for Disease Control and Prevention warned Americans to prepare for possible closings of schools, sports arenas and other germ factories, calling it a matter of when, not if, the outbreak spreads in the country.Chapek, the new CEO, is a longtime Disney executive who has been running the company’s parks and resorts since 2015, and before that the consumer-products and home-video businesses. In his first Bloomberg Television appearance as Disney chief, he said he wasn’t ready to talk about how the coronavirus might affect Disney, but assured investors that “we’ll come back better and stronger than ever.” “Back” implies it’s going somewhere. And down is where the stock went Wednesday, bringing this year’s losses to 12%.As it is, the company’s investments in Disney+, its new streaming-TV service, are weighing on earnings. The launch of Disney+ went better than anyone expected, and it had 26.5 million subscribers as of December. But now comes the hard part: Comcast Corp.’s NBCUniversal will introduce its Peacock app in April, followed by AT&T Inc.’s spruced-up HBO Max in May. Apple TV+ could also pose a threat should Tim Cook decide to plow more money into the service. The early signups for Disney+ were easy wins. Keeping them will be harder and expensive, and those efforts will continue to disrupt the rest of the Disney empire. Iger could see his retirement date “out of the corner of my eye,” he wrote in a memoir, titled “The Ride of a Lifetime,” published in September. “It surfaces at unexpected times. It’s not enough to distract me, but it is enough to remind me that this ride is coming to an end.” In fact, the ride is about to get pretty wild. Maybe he saw that coming, too.To contact the author of this story: Tara Lachapelle at tlachapelle@bloomberg.netTo contact the editor responsible for this story: Beth Williams at bewilliams@bloomberg.netThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Tara Lachapelle is a Bloomberg Opinion columnist covering the business of entertainment and telecommunications, as well as broader deals. She previously wrote an M&A column for Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Bloomberg

    Trump Fight Over California Train Stalls Virgin Muni-Bond Plans

    (Bloomberg) -- Virgin Trains USA’s plan to finance the contruction of a high-speed railroad to Las Vegas with billions of dollars of tax-exempt bonds sold through a California agency is being stalled by doubts about whether President Donald Trump’s administration will approve the project.California Treasurer Fiona Ma said in an interview that she won’t put the proposed bond sale on the agenda for the state debt committee’s next meeting in April unless she sees a letter affirming the federal government will allow it. Virgin Trains, which is backed by Fortress Investment Group’s private equity funds, had argued that investors would buy the bonds anyway with the federal environmental approval pending.Ma is imposing the condition because of Trump criticism of the California government’s plan to build its own high-speed train from San Francisco to Los Angeles, which subsequently lost federal grants. “We don’t have a lot of confidence in the federal government at this moment unless we get something in writing,” Ma said.Ben Porritt, a Virgin Trains spokesman, said company officials are continuing to talk with state and federal authorities and they “appreciate the support for our project.”Virgin Trains is requesting $600 million, or about 15%, of the so-called private activity bonds that California is authorized to give out under federal law this year. Such bonds are also sold on behalf of businesses like housing developers, who had pushed to have all of the securities granted to affordable-home projects to help ameliorate California’s growing homelessness epidemic.The train venture had received $300 million of its request last year, contingent on a final vote from the state’s debt committee this year. But with the lack of clarity from the federal government, the board this month approved giving that allocation to housing projects instead.It’s unclear if Virgin Trains will get a letter from the federal government by the April meeting. Representatives of the Federal Railroad Administration didn’t immediately provide a response to a request for comment. The day of the company’s last appearance before California in January, the agency said in a letter that it’s “continuing to analyze whether the current project modifications trigger the need for additional environmental review.”The train to Las Vegas had received federal approval under different ownership. In the works for more than a decade, the project also has support from Ma, who said it would boost communities by the Mojave Desert. The line is to begin in Apple Valley, 90 miles (145 kilometers) northeast of Los Angeles.By getting $600 million of California’s allocation for private activity bonds, the company can leverage that four times to $2.4 billion because of federal rules that increase the subsidies available to railroads. The tax-exempt financing plans total $4.2 billion for the $4.8 billion project. Virgin Trains would be on the hook for debt payments, not the government agencies selling the bonds.Ma said there is no plan yet on what to do with $600 million of the state’s private activity bond capacity anticipated to go to the rail should the company fail to secure federal confirmation.To contact the reporter on this story: Romy Varghese in San Francisco at rvarghese8@bloomberg.netTo contact the editors responsible for this story: Elizabeth Campbell at ecampbell14@bloomberg.net, William Selway, Michael B. MaroisFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Sustainable Investing Also Is Risk Management

    Sustainable Investing Also Is Risk Management

    (Bloomberg Opinion) -- Investors’ personal values are fine when selecting stocks, but those values can also operate as a risk screen or a strategy to evaluate company risk, says this week's guest on Masters in Business, Brian Deese, global head of sustainable investing for BlackRock Inc., which manages more than $7 trillion in assets. Deese helps the firm use environmental, social and governance (ESG) factors as a risk measure across all of the firm's holdings.During the past few years, ESG has also been a source of alpha, generating above-market returns for investors. Whether this is driven by a heavier weighting in technology stocks among ESG funds or is a function of the positives of ESG is, arguably, unknown. We discuss how solar and wind have become the fast growing sustainable energy source in the U.S. Renewables, including hydro and nuclear, now account for more than 35% of U.S. energy production. The biggest changes coming in energy include efficiency improvements, decarbonization and electrifying transportation.Deese worked in the White House as President Barack Obama’s senior adviser for climate and energy policy. He helped to negotiate the Paris Climate Accord and was one of the key architects of the rescue plans for Chrysler and General Motors. His favorite books can be seen here; a transcript of our conversation is here.You can stream and download our full conversation, including the podcast extras, on Apple iTunes, Overcast, Spotify, Google, Bloomberg and Stitcher. All of our earlier podcasts on your favorite pod hosts can be found here.Next week, we speak with fellow Bloomberg Opinion columnist Danielle DiMartino Booth, founder of Quill Intelligence, a research and analytics firm, and author of "Fed Up: An Insider’s Take on Why the Federal Reserve is Bad for America."To contact the author of this story: Barry Ritholtz at britholtz3@bloomberg.netTo contact the editor responsible for this story: James Greiff at jgreiff@bloomberg.netThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Barry Ritholtz is a Bloomberg Opinion columnist. He is chairman and chief investment officer of Ritholtz Wealth Management, and was previously chief market strategist at Maxim Group. He is the author of “Bailout Nation.”For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • The Zacks Analyst Blog Highlights: Apple, NetEase, Quotient Technology and Alteryx

    The Zacks Analyst Blog Highlights: Apple, NetEase, Quotient Technology and Alteryx

    The Zacks Analyst Blog Highlights: Apple, NetEase, Quotient Technology and Alteryx

  • The Zacks Analyst Blog Highlights: Burlington Stores, Chipotle Mexican Grill, Apple, Chevron and Deckers Outdoor

    The Zacks Analyst Blog Highlights: Burlington Stores, Chipotle Mexican Grill, Apple, Chevron and Deckers Outdoor

    The Zacks Analyst Blog Highlights: Burlington Stores, Chipotle Mexican Grill, Apple, Chevron and Deckers Outdoor

  • The Zacks Analyst Blog Highlights: Apple, Walt Disney and Microsoft

    The Zacks Analyst Blog Highlights: Apple, Walt Disney and Microsoft

    The Zacks Analyst Blog Highlights: Apple, Walt Disney and Microsoft

  • Forget Virus Scare, Buy Tech ETFs on the Dip

    Forget Virus Scare, Buy Tech ETFs on the Dip

    Wall Street is suffering a bloodbath on rising coronavirus scare, with tech stocks leading the slump. Use the dip in tech ETFs as a buying point.

  • Apple shareholders defeat proposal over Chinese app removal policies

    Apple shareholders defeat proposal over Chinese app removal policies

    The proposal had called on the iPhone maker to report whether it has "publicly committed to respect freedom of expression as a human right." Shareholders defeated it, with 59.4% voting against and 40.6% voting in favor. The proposal highlighted Apple's 2017 removal of virtual private network apps https://www.reuters.com/article/us-china-apple-vpn/apple-says-it-is-removing-vpn-services-from-china-app-store-idUSKBN1AE0BQ from its App Store in China. Apple shareholders have voted down human rights measures related to China in the past.

  • Apple investor vote sounds 'warning' over China app takedowns

    Apple investor vote sounds 'warning' over China app takedowns

    The proposal, which called for Apple to report whether it has "publicly committed to respect freedom of expression as a human right," was defeated, but 40.6% of votes cast supported the measure, according to company figures. The proposal highlighted Apple's 2017 removal https://www.reuters.com/article/us-china-apple-vpn/apple-says-it-is-removing-vpn-services-from-china-app-store-idUSKBN1AE0BQ of virtual private network apps from its App Store in China. Such apps allow users to bypass China’s so-called Great Firewall aimed at restricting access to overseas sites, and Apple's action was seen as a step to preserve access to the country's vast market.

  • U.S. Stock Market Appears Most Vulnerable to Virus Shock

    U.S. Stock Market Appears Most Vulnerable to Virus Shock

    (Bloomberg Opinion) -- The stock market with the most to lose from a wider coronavirus outbreak is the one in the U.S.Global markets sold off on Monday and Tuesday on reports that authorities are struggling to contain the virus, which has now spread to more than 30 countries and increasingly threatens the global economy. Until this week, the declines in global stocks seemed to be driven by proximity to the virus’s epicenter in China, but it’s becoming increasingly clear that few markets will escape harm if the virus isn’t contained.What’s not clear is which stock markets would suffer the sharpest declines. That obviously depends on how the crisis unfolds — where the virus spreads, how many people are affected, the impact on regional economies and trading routes, and so forth. But it also depends on the extent to which markets have already digested the potential risks, and by that criterion, the U.S. stock market appears particularly vulnerable.  To see stock investors at their most carefree, take a look at the NYSE FANG+ Index. It’s a pantheon of the Great Disruptors – 10 companies that many investors believe are poised to dominate their respective industries. In order of market value, they are Apple Inc., Amazon.com Inc., Google parent Alphabet Inc., Facebook Inc., Alibaba Group Holding Ltd., NVIDIA Corp., Netflix Inc., Tesla Inc., Baidu Inc. and Twitter Inc. As a group, they are among the most extravagantly priced stocks in history, even for growth stocks.By any measure of price relative to earnings, the FANG index is nearly as expensive as the Russell 1000 Growth Index was at the peak of the dot-com mania two decades ago — or even more so. The price-to-earnings ratio of the FANG index is 34 based on analysts’ estimates of this year’s earnings per share, which is just 6% cheaper than the comparable P/E ratio for the growth index in March 2000. Other measures are even less flattering. Based on last year’s earnings, the FANG index’s P/E ratio jumps to 55, or an 8% premium over the comparable ratio for the growth index. And using an average of inflation-adjusted earnings over the last 10 years, it jumps again to 73, or a 16% premium over the growth index.Investors value the FANG index’s revenue even more than its profits. The price-to-sales ratio of the FANG index is 5.9, or 41% higher than the growth index’s P/S ratio of 4.2 in March 2000. Suffice it to say, when it comes to the FANGs, the market appears to have little concern for the risks around coronavirus or anything else.The reason that’s a potential problem for the U.S. is that eight of the 10 stocks in the FANG index are American companies. Remember that stocks in broad-market gauges such as the S&P 500 Index or Russell 1000 Index are weighted based on their market value. Therefore, as the market value of the stocks in the FANG index has spiked relative to others, so has their weighting in broad-market indexes. Those eight U.S. stocks represent less than 1% of the Russell 1000 by number, but they now account for more than 13% of its market value. That more than anything else explains the wide gap in the valuation between U.S. and foreign stocks. The P/E ratio of the Russell 1000 is 29, based on an average of inflation-adjusted earnings over the last 10 years, which captures the growth of both earnings and stock prices during the decade. By comparison, the P/E ratio of the MSCI ACWI ex USA Index, a gauge of global stocks excluding the U.S., is 19. That’s a premium of 53% for U.S. over foreign stocks, the largest since the data series begins in 1998.  If the virus turns out to be a serious and sustained threat to the global economy, markets are likely to rethink stock prices, including those of companies in the FANG index. And the higher the valuation, the greater the potential for downward revision. That may seem unlikely to investors who view the FANGs as the ultimate blue chips, capable of navigating any environment, but no company is an island. Apple, the largest of the FANGs by market value, has already warned that it will miss sales forecasts because of coronavirus-related disruptions in production and demand for its products.More important, blue chips don’t necessarily provide more safety, particularly when valuations are stretched. In the late 1960s and early 1970s, for example, investors piled into U.S. growth stocks, driving up valuations of companies with fat profits, a key measure of quality. In the ensuing sell-off sparked by the 1973 oil crisis, the most profitable 30% of U.S. stocks, weighted by market value, tumbled 48% from January 1973 to September 1974, including dividends, according to numbers compiled by Dartmouth professor Ken French. Meanwhile, the cheapest 30% of U.S. stocks by price-to-book ratio, which are widely viewed as lower quality, declined 28% during the same period.It happened again during the dot-com boom in the late 1990s. Investors’ renewed obsession with growth stocks drove up the valuations of highly profitable companies. In the ensuing bear market sparked by the collapse of internet companies, the most profitable 30% of U.S. stocks fell 32% from April 2000 to September 2002, while the cheapest 30% of U.S. stocks declined just 10%.  So there’s a lot riding on whether the U.S. disruptors can navigate the risks around coronavirus, not just for their own investors but also for those betting on the broad U.S. stock market. It makes sense that overseas markets took the first hit, but if the virus isn’t contained soon, don’t be surprised if the U.S. stock market turns out to be hit the hardest.To contact the author of this story: Nir Kaissar at nkaissar1@bloomberg.netTo contact the editor responsible for this story: Daniel Niemi at dniemi1@bloomberg.netThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Nir Kaissar is a Bloomberg Opinion columnist covering the markets. He is the founder of Unison Advisors, an asset management firm. He has worked as a lawyer at Sullivan & Cromwell and a consultant at Ernst & Young. For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Tesla’s Autopilot, Cell Phone Use Blamed in 2018 Fatal Crash

    Tesla’s Autopilot, Cell Phone Use Blamed in 2018 Fatal Crash

    (Bloomberg) -- U.S. crash investigators faulted Tesla Inc.’s Autopilot system and the driver’s distraction by a mobile device for a fatal accident in 2018 and called on Apple Inc. and other mobile phone makers to do more to keep motorists’ attention on the road.Tesla was heavily criticized for not doing enough to keep drivers from using its driver-assist function inappropriately. American regulators, which have guidelines but no firm rules for the emerging automated driving systems, were also attacked by the safety board.“It’s time to stop enabling drivers in any partially automated vehicle to pretend that they have driverless cars, because they don’t have driverless cars,” National Transportation Safety Board Chairman Robert Sumwalt said.The hearing was a searing critique of how Tesla and other carmakers have introduced new technologies that automate aspects of driving but still require constant human supervision, and of the National Highway Traffic Safety Administration’s light-touch approach to regulating the safety of those systems.Even though the Tesla SUV in the 2018 crash in northern California had previously veered toward a concrete barrier, the driver, an Apple employee, allowed the semi-autonomous system to essentially steer itself as it passed that same location and moved toward a highway barrier, the NTSB concluded. The driver failed to intervene because he was distracted, likely because he was playing a game on a mobile phone provided by his company, which lacked a policy prohibiting employees from using devices while driving, the NTSB found.The NTSB has for years issued warnings about distracted driving and its deadly toll on the roadways. During the hearing, it called on Apple and other mobile phone manufacturers to develop protections to prevent misuse of electronic devices behind the wheel as a default setting.The agency also urged the NHTSA to conduct a fresh evaluation of Autopilot and take enforcement action if necessary if the agency finds defects.“We urge Tesla to continue to work on improving their Autopilot technology and for NHTSA to fulfill its oversight responsibility to ensure that corrective action is taken when necessary,” Sumwalt said.The death of 38-year-old Apple engineer Walter Huang in March 2018 in Silicon Valley prompted the NTSB to issue its strongest findings to date on safety risks posed by automated driving systems and driver distraction by mobile devices.“Limitations within the Autopilot system caused the SUV to veer towards the area with a concrete barrier that it ultimately struck, which the driver didn’t attempt to stop due to distraction,” the board found.NTSB recommended that both mobile device manufacturers such as Apple, Google and Samsung Electronics Co., as well as employers more broadly, do more to combat distracted driving.Mobile phone manufacturers should lock out features on the devices as a default setting, rather than as an optional feature that must be activated manually, the NTSB said. Employers should adopt policies banning non-emergency mobile phone use by employees when behind the wheel.The NTSB posted a document on Monday in its public record on the crash showing Apple didn’t have a policy on distracted driving.“I checked around with various groups and we do not have a policy related to phone use and driving,” wrote an Apple representative in an email response to the NTSB, which was posted to the safety board’s public investigative files on Monday.An Apple spokesman said the company expects its employees to follow the law. Tesla didn’t respond to a request for comment but has said it has updated Autopilot in part to issue more frequent warnings to inattentive drivers and that its research shows drivers are safer using the system than not. Tesla has also repeatedly stressed that drivers must pay attention while using Autopilot.The combination of growing mobile device use in semi-autonomous cars, in which drivers can take their eyes off the road for long periods, is a combustible mix, said NTSB Vice Chairman Bruce Landsberg.“What this crash illustrates is not only do we have the old kind of distraction” Lansberg said. Partly-automated driving systems present “yet another kind, which is the automation complacency of the system almost kind of always works, except when it doesn’t.”NTSB board member Jennifer Homendy criticized the NHTSA for issuing a recent statement saying it was trying to limit regulations to make cars more affordable.“What we should not do is lower the bar on safety,” Homendy said. “That shouldn’t even be considered for an agency that has the word safety in its name.”NHTSA said in a statement it was aware of the NTSB’s report and would review it. It also said distracted driving remains a concern and that drivers of every motor vehicle available currently on sale are required to remain in control at all times.It is also conducting more than a dozen of its own investigations into Tesla crashes linked to its semi-autonomous system known as Autopilot. Tesla is one of the leading developers of automated driving technology.Warnings to DriverHuang’s Tesla struck the concrete highway barrier at about 70 miles (113 kilometers) per hour. His hands weren’t detected on the steering wheel for about one-third of the drive and the car twice issued automated warnings to him.A protective barrier on the highway designed to reduce the crash impact wasn’t in place, the NTSB found.In addition, Tesla and government agencies haven’t bothered to respond to NTSB’s recommendations related to an earlier, similar crash.Smartphone manufacturers and software developers have taken some steps to address distracted driving. Apple’s iPhone, for example, has a feature to block text message and other notifications when driving that a user can activate in the phone’s settings.“The challenge is that they’re all passive systems. They require you as the owner of the phone to take that action, and many won’t or don’t because they don’t have to,” said Kelly Nantel, vice president of roadway safety at the National Safety Council.While the safety board stopped short of concluding that NHTSA’s lack of actions were part of the cause of the crash, it found that the regulator hadn’t done enough to set safety standards and called its approach to semi-automated vehicles “misguided.”Separately, the NTSB is prepared to cite the highway-safety regulator’s actions in another fatal Tesla crash as a contributing factor.In a March 2019 crash in Delray Beach, Florida, a Tesla drove into the side of a truck without braking, killing the driver. The conclusions of the investigation haven’t been published, but were read by Homendy during Tuesday’s meeting.(Updates with details from hearing, beginning in the fourth paragraph)To contact the reporters on this story: Ryan Beene in Washington at rbeene@bloomberg.net;Alan Levin in Washington at alevin24@bloomberg.netTo contact the editors responsible for this story: Jon Morgan at jmorgan97@bloomberg.net, Elizabeth Wasserman, John HarneyFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

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