Thursday, July 9, 2020

Huge News For Apple Sales, 2Q10 -- July 9, 2020

As middle schools, high schools, universities and graduate schools go to "all on-line" Apple will be the major beneficiary.

Apple and education are joined at the hip.

Google Chrome and elementary education is likewise joined at the hip, but no self-respecting student over the age of fourteen would be seen dead with Google Chrome.

Doubts? Watch product placement on television shows and movies (mostly now seen in the comfort of one's home or streaming).

Now this, being reported today: Apple's worldwide Mac shipments were up over 5% during 2Q20, amid overall PC market growth.

And just one year ago, "everyone" said the Mac was dead and PC market growth had plateaued and would not decrease over time. But, of course, that was BC (before corona).

Disclaimer: this is not an investment site.  Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here.

Note that Google Chrome is not in the table above: unless things have changed, Acer and Samsung make the Google Chrome. Samsung is not listed, and Acer is just below Apple.

Note that "Others" showed a 22% decrease in growth but overall shipments increased by 2.8%.

At the linked article:
According to Gartner, PC shipment growth during the quarter was driven by purchases necessary for working from home and online education. The upward tick in shipments is not expected to continue.
Cognitive dissonance.

By the way, it's all about "margins" when it comes to earnings. A reader noted and I agree wholeheartedly:
If you compare the price of a Mac with the price from Lenovo, HP, and Dell, Apple has a great market share.
You can buy easily an HP laptop at $249 for example.
Yup. I’d love to know what Apple’s share of premium (over say $750 or $1,000) desktops and/or laptops are. Lumping $300 disposable laptops in with Macs makes as much sense as grouping $10 fitness bands in with Apple Watch. Or HomePod in with those $19 Google home or Amazon Echo online hot mics. Or $30 tablets with iPad.
It does kind of make me wonder what the market share of golf carts and riding mowers are compared to Honda Civics and BMW M8s
It is interesting to note that our older daughter bought a brand new Mac table-top this past quarter solely for telemedicine.

I'm sure the comments at the linked article will be as snarky as ever. LOL.

What do Trump and Apple have in common? No one loves either and they are both being sued by everyone, but they keep on truckin'.

But look at this:
IDC also released its own PC shipment estimates this afternoon, and its estimations are wildly different.
IDC's data suggests Apple shipped 5.6 million Macs during Q2 2020, up 36 percent from the 4.1 million estimated to have shipped in Q2 2019.
IDC believes that the overall worldwide PC market saw 11.2 percent growth with 72.3 million total PCs shipped, while Gartner believes there were 64.8 million total PCs shipped during the quarter.
I can hardly wait for Tim Cook's next earnings presentation.

By the way, this story was being reported elsewhere. From Fox Business News --
Personal-computer sales rebounded in the June quarter, driven by higher demand from workers and students forced to study and work from home amid the coronavirus, according to preliminary data from two industry-research firms.
Global PC shipments rose 11% to 72.3 million in the quarter, with the U.S. posting its highest quarterly-shipment volume in more than a decade, according to preliminary data from International Data Corp.


Note: this is, hands down, one of the most boring things I to do each quarter. I doubt anyone really looks at it but the day I quit doing this will be the day I miss posting something important. The word "important" is used loosely. Very loosely.

This is linked at the top of the sidebar at the right during earnings season. After earnings -- pretty much after Whiting and Apple posts their earning, this post will move back into obscurity.

Disclaimer: this is not an investment site.

Earnings -- 2Q20

This is not an investment site. Do not make any investment, financial, job, travel, or relationship decisions based on what you read here or what you think you may have read here. If this is important to you, go to the source. There will be content and typographical errors on this page. If something looks wrong, it probably is.

NOG: posted here;

MDU: link here. Beats.

SRE: link here. Huge beat.

MSFT: beats

TSLA: blows past estimates; fourth consecutive quarter showing a profit;

BRK: contributor over at SeekingAlpha. Monthly update of dividend-paying stocks held by Berkshire Hathaway. I have not read of the article, mostly the summary, and even not much of that.

AAPL: Morgan Stanley-- Apple to outperform 2Q20 estimates; forecast revenue and EPS of $55.1 billion and $2.18 EPS;  posted July 26, 2020; Apple to report after market closes on July 31; on July 24, CNN reported earnings and sales forecast for AAPL: EPS, $2.03; sales, $51.9 billion; outstanding shares, 4.33 billion [4.33 x 2.03 = 8.7899].

AAPL: earnings here; record for the June quarter;

VZ: beats estimates; EPS, $1.13 per share, vs 40.95 per share a year earlier.

  • MFST: $10.6 billion, reports July 30, 2020
  • AAPL: $8.8 billion; AAPL topped MSFT by 5% in 1Q20
  • so, EPS numbers to watch -- MSFT, 10; AAPL: 9. 
SRE to use Bloom Energy fuel cells.

BlackRock profit beats Street estimates. Profit jumps 21% on fixed-income boost.

Market finally notices: retail sales jump 7.5% in June, 2020. Excluding gasoline, US retail sales have come all the way back ot pre-pandemic trendline growth.

Analyst: Amazon will beat 2Q20 earnings estimate. Calls for revenue of $81.3 billion, a 28% year-over-year increase and above the high end of Amazon's guidance of between $75 billion and $81 billion. The estimate is 0.8% above consensus.

Tesla: Tesla vehicle registrations in California dropped by half in 2Q20. Link here.

Fast and furious. I've just scanned the financial headlines, and the earnings reports are surprisingly good. Headlines without links are from Yahoo!Finance:
  • Morgan Stanley earnings crushes views, link here;
  • Morgan Stanley joins Wall Street's gold rush with record profit;
  • Bank of America, link here;
  • AstraZeneca stock jumps on report of positive data on Covid-19 vaccine trial;
  • Domino's US sales surge on pizza demand during pandemic;
  • Johnson & Johnson earnings top; Dow Jones giant raises full-year guidance; 
  • Abbot Labs' stock gains after profit, revenue and full-year outlook top expectations;

No New Permits; Twenty-Two Permits Renewed -- July 9, 2020

Peak wealth? What peak wealth. There are two interesting data points regarding the graphic below (posted just above the "fold").

Peak oil? What peak oil?


Disclaimer: this is not an investment site.  Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here.

Tesla: Before for Sophia invests in TSLA, I'm having her do some "due diligence." We are reading her new book, A Brief History of Unicorns, Selwyn E. Phipps, c. 2019. More on this series later.


Comments regarding graphic at the top:
  • Tim Cook does not make the list; Steve Ballmer did (make the list);
  • Jeff Bezos is in a "league of his own
Back to the Bakken

Active rigs:

Active Rigs1157655629

No new permits.

Eleven permits canceled (these should have been in the July 8, 2020, DAR, but somehow overlooked by NDIC in yesterday's report; there were a lot of typographical errors in that report also):
  • Equinor (8): two Raymond permits (McKenzie); two Olson permits (Williams); two Martin permits (Williams); one Marcia permit (Williams)
  • Whiting (2): two Iverson permits (Mountrail County)
  • Rimrock: one Skunk Creek permit in Dunn County
One producing well reported as completed:
  • 37111, drl/A, Crescent Point Energy, CPEUSC Njos 8A-26-35-157N-100W TFH, Marmon, t--; cum --;
Twenty-two permits renewed:
  • Rimrock Oil & Gas (8): seven Skunk Creek permits and one Moccasin Creek permit, all in Dunn County 
  • SHD (7): one permit each, all in McLean County: Epsilon, Delta, Demeter, Cheetah, Narcissus, Poseidon, and Zeta;
  • Whiting (4): one Pronghorn Federal and two USA Federal permits, all in McKenzie County; a Kessel Federal permit in Williams County;
  • Slawson: a Gunslinger Federal in McKenzie County;
  • Liberty Resources: a Sundhagen C permit in Williams County
  • Newfield: a Moberg Federal permit in McKenzie County

US Crude Oil Supply: Almost 40 Days -- July 9, 2020

US crude oil, days of supply: link here. The supply continues to shrink, at least measured in number of days. We're now down to 38.6 days. The previous reading was 38.8. LOL. Divide by seven days, this represents about six weeks of supply.
Two weeks of supply is cutting it close; one doesn't want to see that. About perfect is three weeks, or 21 days. Anything over four weeks (28 days) is "ludicrous," as Elon Musk would say. So, yes, six weeks of supply is ludicrous.
The Literature Page

This is so cool. Back on April 27, 2020, I stumbled across the Bay of Fundy while reading a biography of Wyndham Lewis.
The Bay of Fundy.
Sail down the St Croix River, which forms part of the border between Maine, US / New Brunswick, Canada, sail through the Passamaquoddy Bay, and then make a hard turn to port, on a 45° heading, to enter the Bay of Fundy, located between New Brunswick to the west-northwest and Nova Scotia to the east-southeast.
Link here.
The Bay of Fundy is one of the 7 wonders of North America. The highest tides on earth, the rarest whales in the world, semi-precious minerals and dinosaur fossils; all this convinced an international panel of experts in 2014 to choose the Bay of Fundy as one of the natural wonders of the world. 
Today,  while reading the Greek tragedies, I stumbled across the Euripus Strait, separating the Greek island Euboea from Boeotia, mainland Greece.
The strait is subject to strong tidal currents which reverse direction approximately four times a day. Tidal flows are very weak in the Eastern Mediterranean, but the strait is a remarkable exception. Water flow peaks at about 7.5 miles per hour, either northwards or southwards, and lesser vessels are often incapable of sailing against it. When nearing flow reversal, sailing is even more precarious because of vortex formation.

The Swiss scholar Fran├žois-Alphonse Forel contributed to an understanding of the enigmatic phenomenon by his study of limnology and the discovery of seiche, where layers of water of differing temperature oscillate in thickness in a confined body of water.
But the problem was solved completely only by D. Eginitis, director of the Athens Observatory, who published his conclusions in 1929.
So, the word for the day:
  • seiche (pronounced like "latch" but with a long "a"): a temporary disturbance or oscillation in the water level of a lake or partially enclosed body of water, especially one caused by changes in atmospheric pressure.
So, how is the Euripes Strait related to the Greek tragedies? This is where the Greek flotilla stage prior to setting out for Troy. From wiki:
As the Greek fleet was preparing to sail to Troy to force the return of Helen, they gathered in Aulis near the Euripus Strait.
While there, king Agamemnon killed a stag sacred to the goddess Artemis. The enraged deity caused a contrary wind and eventually forced the king to agree to sacrifice his daughter Iphigeneia in order to ensure a favorable wind for the Greek fleet.
In one version of the myth, a surrogate sacrifice was provided through the divine intervention of Artemis, and the saved girl then became a priestess of the goddess among the Tauri, a people living near the Black Sea in the Crimean peninsula.
Subsequent to these events, Iphigenia returns from among the Tauri with the assistance of her brother Orestes. In Euripides' version of the myth, the goddess Athena reveals that Iphigenia will make landfall in Brauron and there be the priestess of Artemis, die, and be buried.

US Supreme Court Rulings -- July 9, 2020

Later, 3:22 p.m. CDT:

Later, 12:47 p.m. CDT: Durham will run out the clock. Says he doesn't want to look "political."

Original Post

I was asked about the market today.

Note: in a long note like this, there will be content and typographical errors. Opinions and facts are interspersed and it will be hard to tell the difference between the two. I tried to keep the note as balanced as possible despite my highly opinionated opinions. 

My not-ready-for-prime-time reply:
The market was up and AAPL hit a new all-time new high shortly after opening but then dropped back after the US Supreme Court rulings re: Trump's tax returns.

Folks are only reading the headlines. The story is actually not that remarkable.
The little bit of the ruling that I actually read suggests that the US Supreme Court got it right.
[I'm not completely sure about that -- Article II, Supremacy Clause, US Constitution -- but at the end of the day, I think this is the "right" decision -- if Trump supporters question that, consider the fallout/impact if Hillary had been elected president and the US Supreme Court ruled otherwise. If Biden is elected president, Trump supporters may be happy that the court made this ruling: in effect, no one is above the law.]

Bottom line: tax returns won't be released during the election. Won't be released until well after 2020, if at all.
Both cases were referred back to the lower courts.
In the first case, much legal wrangling will continue. It will end up back in the US Supreme Court if the lower court rules in favor of the grand jury. The US Supreme Court is now adjourned for this year. They won't be back in formal session until next year. There is no urgency for the NY grand jury to act. The air is out of the balloon. 
In the second ruling, even though it was referred back to the lower courts, the US Chief Justice in his ruling telegraphed that as far as he is concerned, the issue is dead: the US House is not the place to conduct such proceedings, per the US constitution. If the US House wants to proceed, they can go other routes to impeach the president.
1. First ruling: NY grand jury investigating Trump's financial dealing wanted Trump's tax reports. The headline: US Supreme Court says grand jury can see Trump's tax reports.
In fact, the US Supreme Court only said that the president doesn't have "absolute immunity." But NY grand jury needs to provide adequate reason why tax reports are needed. So, the case goes back to the lower court to determine if grand jury provided adequate information. If adverse ruling, Trump would take it back to US Supreme Court.
The president "may raise further arguments as appropriate," in lower courts in an effort to keep [New York grand jury] from obtaining his documents, Roberts wrote.
2. Second ruling: US House committee wanted the tax documents if the NY grand jury got them. See #1 above. Roberts authored the ruling for this case (and the one above): in the second ruling, Roberts said that US Congress cannot see tax documents from NY grand jury even if the grand jury gets them.

So this becomes a political story again, nothing more, nothing less, and it will all be forgotten by next week.

The market is so high, traders are looking for any reason to take a profit.
This is a very,very good example on how "doing due diligence" can make a huge impact in investing.

Disclaimer: this is not an investment site.  Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here.

Of course, due diligence still doesn't explain an $1,800 target for TSLA, which is up slightly for the day, but down off its highs.

Notes From All Over -- The "Montana Update" Edition -- July 9, 2020

Most snow in 30 years means it could be months before plowing is finished -- allowing access to "Going-to-the-Sun Road." Link here.  May 4, 2020.
Thanks to the most snow in 30 years it could be months before Glacier National Park’s famed Going-to-the-Sun Road is fully cleared by plowing and open to traffic. As plows move up the road, avalanche forecasters and technicians are monitoring the snowpack for possible avalanches to provide for crew safety and are warning visitors hiking or biking up the historic roadway to be alert to the possibility of avalanches, which are common in spring during periods of intense or prolonged warmups. 
Snow crews reach Logan Pass June 12, 2020, eighteen days later (May 25, 2019), than they did last year. Reaching Logan Pass
  • this year, 2020: June 12
  • 2019: May 25
  • 2018: June 22
  • 2017: June 28
The plow crews clearing Glacier National Park have reached Logan Pass and are starting to clear the Big Drift, an area in northern Montana where massive amounts of snow accumulate, officials said.
The stretch of Going-to-the-Sun road is often buried under 80-feet of snow and is the biggest challenge of the months-long clearing operation.

Three Wells Coming Off Confidential List; Impact Of DAPL Closure -- RBN Energy -- July 9, 2020

Breaking: US Supreme Court rules NY grand jury can see President Trump's tax filings. Will rule later (probably today) on whether grand jury can release that information to US Congress.  Market drops after announcement. Apparently investors were just joking about wanted a Biden presidency.  
Later: US Supreme Court denies US House from access to Trump's tax filings. Comment: pretty funny. The headline is bigger than the bite. The US Supreme Court threaded the needle again, and failed to make a definitive ruling. Bottom line: nothing will be released between now and November 4, 2020. Social media comments suggest few have actually read the entire ruling. Now back to the original headline: US Supreme Court rules NY grand jury can see President Trump's tax filings. Turns out to be not quite accurate.
Top story: Ivy League suspends all sports this fall. Link to CNN but it's not fake news. Canceling sports will add significantly to financial woes for universities and colleges. Dorms will be empty, as will bookstores and cafeterias. No wonder Harvard cannot afford to reduce tuition despite going all on-line.

Jobless: numbers came in better than expected. Before the opening:
  • Dow: goes green after report, but just barely.
  • AAPL: could open at another all-time high; right not, up 1%; up another $3.73, trading at $385
  • MSFT: up 1.6% -- could MSFT, today, overtake AAPL as company with largest market cap?
  • TSLA: up almost 2%
  • AMZN: up over 1%
See disclaimer below.

Fast and furious:
  • Blue flu; NY police department retirement applications surging; link here.Think: strain on pension fund. Huge strain.
  • Apple bonanza: universities go on line. Apple launches back-to-school promotions. 2 + 2 = 4. Link here.
  • Back to the future; algae biofuels drowning. Link here
  • Walgreen's: in trouble. Here.Who wudda thought? 
  • BBBy: will close over 200 stores over the next two years. Story on every corner.
  • TSLA: dumbfounded by Tesla, Morgan Stanley analyst issues $1800 price target. Link here
More fast and furious:
  • Oof-da! Norway has a $100 billion bill to pay to decommission old North Sea rigs. Link here. Or here.
  • Convent: Shell may sell its 240,000 bopd Louisian refinery. Link here.
  • Gasoline demand: at pre-pandemic levels but not yet where it should be -- Bloomberg.
  • Chesapeake bankruptcy: old story but being re-posted. Won't lose federal leases during bankruptcy. Link here.
  • Shell game: Pemex plans $22.4 billion debt swap.
  • Heavy oil? US refiners up up crude imports from Mexico to 8-year high. Link here.
  • OPEC basket, link here: up slightly at $43.44. 
And even more fast and furious:
  • Wow: three "strong buy" micro-cap stocks -- link here -- IMUX leads the list. Then BFYT, and then SALT.
Disclaimer: this is not an investment site.  Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here.

Mortgage rates: all-time low. Rates fell while investors were freaking out over America's skyrocketing cases of COVID-19, which could disrupt the economy's fragile recovery. Link here.

Back to the Bakken

Active rigs:

Active Rigs1157655629

Three wells coming off the confidential list -- Thursday, July 9, 2020: 34 for the month; 34 for the quarter, 480 for the year:
  • 37247, drl/NC, CLR, Xavier 3-10H, St Demetrius, t--; cum --; 
  • 36696, drl/NC, WPX, Pronghorn 22-15HX, Spotted Horn, t-- cum --;
  • 36633, drl/NC, Sinclair Oil, Renae 16-21-1H, Lone Butte, t--; cum --;
RBN Energy: the challenges posed by shutting down DAPL. Archived.
A federal judge’s order that the 570-Mb/d Dakota Access Pipeline be taken out of service for a year or more starting August 5 has the potential to wreak more havoc for producers in the Bakken Shale at a time when they are still reeling from drastic, COVID-related production curtailments.
While those production cuts have opened up at least some capacity on other takeaway pipelines out of western North Dakota and crude-by-rail terminals may be able to ramp up their operations, that may not be enough to make up for the loss of DAPL — still more well shut-ins may be required. Then there’s the matter of taking the 1,172-mile, 30-inch-diameter pipeline offline in only four weeks’ time — it involves much more than flipping a switch and may not even be possible within that time frame. Today, we consider the hurdles and implications of removing DAPL from service.