@ $450/share - Apple is still the cheapest stock on the Market

[youpissmeoff]

and this is why....

- Stocks trade on future earnings potential.
- Big stable companies historically trade at 15 x earnings / share
- high growth companies trade at much higher multiples
- Google - 20 x earning
- Amazon - 90 x earnings
- EMC - 29 x earnings
- Aapl last QUARTER earnings were $13/share
- $13 x 4qtrs = $52 x 15 = $780/ share
- As they are a retailer and 4q earnings tend to be higher, lets use $13 Q4, $10Q1 - Q3
($13+10+10+10) = 43 x 15 = $645 / share

Wait... We are using old stable 15 x earning to value a company whose revenue grew by 75% last quarter. 75%!!!!!

And here is the real kicker. Apple has $102/share in cash. They have more cash on hand than all but 52 of the total value of individual companies on the Stock Exchange. In other words, Aapl's cash is worth more than all but 52 individual companies in the US.
- OK add back cash to the $645/share and Aapl stock should be trading around $747/share using a 15 x earnins model
- Use a 20 x earnings model like Google (though Aapl's income and revenue is growing faster) and you get $962/share. {($43 x 20) + $102 cash}

The most amazing business sucess story in the US in a long time.

 

[digimon7068]

there are LOTS of stupid investors out there and there are lots of stocks that are trading at an unjustifiable premium right now...and, while apple appears to be an outlier, i'm still maintaining a healthy level of skepticism.

 

[miplank]

How many shares of aapl do you have billy boy?

 

[youpissmeoff]

How many shares of aapl do you have billy boy?

Not enough man.

I had an account that is managed externally that was supposed to add some. I asked him last night if he did and he has not returned my email. I am assuming that answer is no.

 

[miplank]

Slide me some of them aapl shares you got bro.

 

[youpissmeoff]

Slide me some of them aapl shares you got bro.

Dude - I am your older alter ego. They are yours anyway.

 

[miplank]

Dude - I am your older alter ego. They are yours anyway.

So like, you gonna put me in your will?

 

[wootoom]

Awesome read Plank

 

[lartinos]

You would need mad dough to even invest in a stock that trades that high. Cheapest stock for the richest guy may be a better way to put it.

 

[miplank]

Awesome read Plank

you're welcome