“Apple on the way to over $1,000? It ‘s more plausible than you may think,” James Kostohryz writes for Minyanville.
2009:
• Important iPhone tech upgrades
• Price slashing on iPhones
• Further upgrades of notebook computers and slashing of prices
• Snow Leopard Operating System (This OS is so superior to Microsoft Windows)
Kostohryz writes, “Applying a conservative FCF yield of 4.5% on the 2010 FCF, the stock should be trading at around $289. Assuming a 5-year earnings per share (or EPS) growth of 18%, and applying a price/earnings to growth (or PEG) multiple of 1.5 to 2010 pro forma earnings, produces a price target of $297. Now add in the approximately $30 per share of cash on the balance sheet, and you have a stock that, only accounting for the factors that have been announced, could well be well above $300 by the end of 2009.”
2009-2010:
• No more AT&T iPhone exclusivity
• Touchscreen tablet
• iPod Touch with camera and video capabilities
• Invasion of the Chinese market; first with iPhone, then with Mac
• Steve Jobs’ comeback to announce any or all of the above
Kostohryz writes, “Incorporating these developments into an earnings model could easily produce a price target of $400+ by the end of 2010.”
2010-2011:
• Introduction of touchscreen Macs and notebooks
• Apple’s first truly integrated home/business computing, communications and telecom device
• Release of “teaser” versions of its OS to compete directly with Microsoft (Superior product captures 50% of market; premium versions of OS and software products only available on Apple hardware)
Kostohryz writes, “If any one of these 3 possibilities comes to pass, Apple goes to $700 to $1000 by 2012. If all 3 occur, look for the equivalent of $1,200 to $1,400 by 2015 (obviously there will be some stock splits along the way). Indeed, it is possible for the valuation to go even higher if Apple achieves global ‘cult-brand’ and ‘cult-stock’ status — not an unlikely scenario in my view.”
Don’t forget to bring your bathing suit: Jimmy’s got a pool full of Kool Aid and he’s not afraid to dive into (off?) the deep end. There’s plenty more where that came from in the full article here.
MacDailyNews Take: iCal’ed.
[Thanks to MacDailyNews Readers “Vishnu” and “Mike in Helsinki” for the heads up.]
