Parchayi.com – Personal Finance Simplified

I’m glad that somebody bought PALM finally! I own no stock in either PALM, Inc. (PALM) or Hewlett Packard Company (HPQ) but I didn’t want to see WebOS die. I don’t own a WebOS phone but it was a strong contender to be my next phone. Of course my hope was that HTC would take the EVO or the Incredible and slap PalmOS on it, but well HP can do something similar.

Dell is entering the Smartphone market, Asus makes the Garmin Phone and Lenovo has a phone in China. It was an obvious next step for HP to have a phone and HP is a Microsoft Windows Phone 7  partner too. But if HP could have its own OS that is at least equal to if not better than everything that is out there along with PALM’s excellent patent portfolio, that is even better than having the Microsoft deal.

Microsoft has been going after Android device makers to license patents and HP can avoid those Microsoft fees if it has PALM. In fact HP can avoid Windows Phone 7 altogether. Personally even though I am very happy with my current Windows Mobile phone and Windows Phone 7 sounds promising, I expect that it will have teething trouble because it is a complete rewrite and not backwards compatible. Also Windows Phone 7 suffers from many shortcomings of the iPhone such as a closed ecosystem for apps, which are not problems with Android or WebOS.

All HP needs to do now is pair some good hardware with WebOS.

Thanks to it’s meteoric rise in the last year, Apple is now Parchayi and my largest single investment. I was considering taking some profits when it crossed $250, which it did today after the monster quarter of nearly doubling earnings to $3.1 billion ($3.33/share) from 1.6 billion ($1.79/share) same Q last year on a 50% increase in revenues to $13.5 billion from $9.1 billion last year.

The iPad did not start selling in the last quarter and is not reflected in the above numbers. Mac shipments rose 33% and iPhone sales were 8.9 million (worldwide), a lot more than expected and even more than the holiday quarter sales of 8.8 million.

Apple doesn’t comment on rumors but it seems like the question to ask about a CDMA iPhone on Verizon is  not if, but when. Also with the next iPhone (iPhone HD?) in the works with a rumored release in summer and iPad there is no telling what earnings will be like next quarter.

Apple says that margins will be lower next quarter thanks to lower margins on the iPad and lower margins on “future product transition”. That can only mean the new iPhone. Margins are generally always lower on newer products until parts become cheaper as volume increases.

I’m now reconsidering holding on until Apple hits $275 to sell about a third of my holdings. The next iPhone seems to be finally catching up with other phones (HD2, Droid, Nexus One, Incredible etc.) in many hardware specifications where it was lacking such as flash for the camera, higher resolution screen and more.

There are things I don’t like about Apples ecosystem such as it’s fight with Adobe, resistance to Flash, arbitrary app store policies etc. but these don’t seem to be putting a dent in the adoption of the iPhone or iPad. Forced use of Macs to develop for the iPhone is another thing I don’t like but as far as Apple goes that is a great way to sell some more Macs.

For the next quarter AAPL’s guidance is $2.28 – $2.39 a share on revenues of $13 billion – $13.4 billion. Apple is known to provide extremely conservative guidance and has beat its guidance for as far as I know at least five years (don’t quote me on that). Analysts were expecting at $2.70/share on about $13 billion. It is quite likely that Apple will handily beat both estimates unless iPhone sales drop significantly on expectations of the launch of the new iPhone.

Two stocks to watch today are Google and Intuitive Surgical (other than Goldman Sachs after the fraud accusation).

Intuitive Surgical reported spectacular results today far ahead of analyst expectations with earnings coming in at $2.12 per share compared to the expected $1.69. Intuitive has beaten expectations in 6 out of the last 8 quarters and more than tripled in a year. In spite of that it continues to remain a good investment as it continues to surpass expectations. The stock price was driven up a lot in anticipation of great earnings  over the last couple of days. Suddenly after the report today the stock price has fallen nearly 5%.

Google also dropped over 6% in spite of beating analyst expectations because they plan to spend more aggressively to maintain their search lead. Google has also beaten analyst estimates in the past 7 quarters.

So what makes people drive down the stocks of companies that show repeated excellent performance. Why do investors question decisions form companies that have consistently done things right? The answer is because they can. Well, not really. The answer is that the stock prices are needlessly driven way up before earnings and that leads some investors to sell to take profits as soon as results are announced.

I put both these stocks at a buy and today with the negative tone that the market has taken might be a good time to get into either one.

Disclaimer: I own both stocks.

Yesterday was the second time I got a call from a “US government” department. This time the department had something to do with finance and they actually got my name correct possibly from a directory listing. Last time I got the call – a few days ago at my work number – they didn’t even know who they were calling. Just “Your Name and Number has been picked to get $7000 from the US Government Department of Krauss” (that’s what it sounded like, I made the person repeat the name of the department 3 times but I couldn’t tell what it was).

Who exactly are the people that fall for this crap? I’m sure someone somewhere believes this shit and hands over financial info. After all there are some people who buy V1@grA from email spammers and send money to Nigeria with the hopes of getting more money from a random prince.

The first call it was somebody with an Indian accent. The second one sounded more like an eastern European one. People who fall for this stuff probably deserve it. If you are someone who would fall for this, here is a warning that it is not true. The US government gives people money quite often but they do make you file taxes to get it.

Taxes reminds me, don’t forget to get your $800 by filling out Schedule M.

Update: After some hunting around online, I couldn’t find many instances of people reporting this. Here is one that I found, which is in Oct. 2009. This led to a phone number – 202-684-6582 – and a search for that phone number revealed at least one idiot who fell for the scam.

Every so often we see merger, takeover and failure rumors floating around. Then the CEO of the company says that the rumors are all false. Before the Wachovia collapse that happened on a Sunday, the CEO went on TV on Friday to let investors know that his bank was not in bad shape. Jim Cramer apologized for being duped.

Palm’s CEO also indirectly squashed takeover rumors by saying “We’ve said we have a plan that takes us to profitability.” However takeover rumors continued and finally Bloomberg seems to have confirmed the rumors making Palm’s stock surge.

It is sad to see Palm go and hopefully the new buyer will be someone who will continue WebOS, which is widely regarded to be the best of the smartphone Operating Systems with real multitasking, easy development and great features from ease of use to great looks.

I’m keeping my fingers crossed that it is HTC and they will put WebOS on something like Evo hardware.  My HTC Touch Pro is now aging but I think I can wait a while to see how 4G pans out before upgrading. I was seriously considering a Palm Pre Plus until PALM’s latest earnings report.

A few months back I got a spam call at home asking me if I would like to support clean coal. I just hung up but I really should have asked the person at the other end if she really believed the crap about clean coal. All these clean coal nutcases think that just capturing the output from coal energy plants will make coal greener. They claim that coal is local and cheap and reduces dependency on foreign oil.

As far as the output from coal energy plants goes, that seems to be a major contributor to climate change (euphemism for global warming).  Anyway foreign oil or any oil for that matter is not a major contributor to electricity generation in the US. The top sources are coal, nuclear, natural gas and hydroelectric.  The big foreign source here is Canada for natural gas.

Clean coal supporters fail to mention that coal is cheap because the conditions in mines suck, as proven often by the regular deaths in coal mines in West Virginia including the deaths on Monday at a mine with a history of violations run by a company with a history of violations. They would rather kill miners, cause them cancer and other health problems and destroy the local environment by mining than import some natural gas from Canada or support more really clean energy like nuclear, wind, solar etc.

Also often cited concerns of nuclear plants are radioactive waste. Well, what about the radioactive waste from coal that is more dangerous and pumped directly into the atmosphere as compared to the safely stored and hopefully reusable waste from nuclear.

Make mines safer, force bad mining companies to cease operations while violations are not fixed and coal may no longer be competitive  in any way.