A blogger-analyst highlights the growing gap between its earnings and its stock price
"In just four-years," writes Andy Zaky in a passionately worded post published Sunday on his Bullish Cross blog, "Apple's earnings have grown 600% to $27.68, and its revenue skyrocketed 341% to $108.2 billion. That's the most explosive 4-year growth rate of any large-cap company on the entire S&P 500."
Yet Apple's (AAPL) shares closed last week at $363.57 with a MOREPhilip Elmer-DeWitt - Nov 28, 2011 7:15 AM ET
When the company's blistering growth is factored in, it certainly looks that way
Four years ago, before the 2008 recession, Apple (AAPL) was trading at more than 45 times earnings. Today it's trading at less than 15 -- a situation that frustrates investors no end.
A little over a week ago, Dirk Schmidt, a German management consultant writing on one of our favorite blogs -- Horace Dediu's Asymco -- posed an interesting MOREPhilip Elmer-DeWitt - Sep 5, 2011 2:59 PM ET
Its P/E ratio hit 13.97 Monday, lower than at the depth of the 2008-2009 meltdown
Reader Travis Lewis points out that after Monday's $20.41 (5.8%) drop, Apple's (AAPL) price-to-earnings ratio has fallen below the low point set on Jan. 20, 2009 -- six days after Steve Jobs announced his second medical leave -- when the stock closed at $78.20.
To make the comparison, Lewis had to go back to Apple's non-adjusted earnings MOREPhilip Elmer-DeWitt - Aug 9, 2011 7:21 AM ET
Now that the stock has finally broken through the $400 barrier, how high can it go?
Last summer, when Apple (AAPL) was trading for $260 a share, we ran an item on some analytical work by Nicholae Mihalache, a Romanian mathematician who teaches at the University of Paris. He had prepared a series of charts tracking Apple's performance using various criteria, from the familiar P/E (price to earnings) ratio to the more MOREPhilip Elmer-DeWitt - Jul 26, 2011 4:05 PM ET
By the same "PEG" measure, the 3 most overvalued are Amazon, Cisco and Netflix
Here's a simple exercise suggested by one of my readers.
Take a stock you're interested in and calculate its price/earnings to growth ratio, better known as its PEG ratio. The formula looks like this:
According to Peter Lynch, who popularized the measure, the P/E ratio of any company that's fairly priced will equal its growth rate. In other words, MOREPhilip Elmer-DeWitt - Jun 19, 2011 7:08 AM ET
On Bloomberg TV, the head of Holland & Co. joins the chorus mystified by AAPL's valuation
Michael Holland can't believe Apple (AAPL) is selling for 11 times next year's earnings.
"Apple's not being picked on," he told Bloomberg's Carol Masser Wednesday, "they shouldn't take it personally."
Holland, who worked for J.P. Morgan, Salomon and Oppenheimer before starting his own private investment firm with $4 billion in assets, names Google (GOOG) and Microsoft (MSFT) MOREPhilip Elmer-DeWitt - Jun 15, 2011 10:27 AM ET
The stock is up 330% since its 2008 low, but that's really nothing to write home about
In an article posted Friday on Seeking Alpha, Fortune.com contributor Andy Zaky takes aim at a phrase that has attached itself to Apple (AAPL) recently: "the darling of Wall Street." (Google it; you'll be surprised how often it pops up in the financial press.)
Apple is a darling, the thinking goes, because the stock has MOREPhilip Elmer-DeWitt - May 13, 2011 7:40 AM ET
In 2007, it was trading for nearly 50 times earnings. Today it's 16.7. What happened?
I hate to quote Horace Dediu twice in one day, but sometimes it can't be helped.
Wednesday's post on his Asymco blog features the chart at right, which plots Apple's (AAPL) share price (blue line) over the past four and a half years set against multiples of earnings (15 x EPS, 25 x EPS, etc.). The chart MOREPhilip Elmer-DeWitt - Apr 27, 2011 7:03 PM ET
Apple (AAPL), which has been trailing the market recently, reversed the trend on Monday and closed up $2.71 (0.85%) in a down market to set a new all-time intraday high of $322.33 and a new high closing price: $320.15.
A few useful stats courtesy of the Wall Street Journal:Year-to-date rise: 52% Rise over past twelve months: 65.6% Since the end of August: 32% Market Cap: $293.68 billion Trailing 12-month price-to-earnings ratio, as of Friday Dec. MORE Philip Elmer-DeWitt - Dec 6, 2010 5:27 PM ET
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