“Take Apple, now the world’s second-most valuable company, with a market capitalisation of $330bn. This is the company that practically invented the MP3 player and tablet computer markets, through the revolutionary iPod and iPad, and became a leader in smartphones through the iPhone,” Louth reports. “Although it has only a 4 per cent market share in the global market for mobile phones, data from Asymco show that its iPhones account for half of all the industry’s profits.”
Louth reports, “To see the real value of the stock, you have to subtract the cash mountain – a veritable Himalaya of $50bn, or $55 per share – on the balance sheet. That is enough to buy Tesco or Barclays outright. So, on an adjusted share price of $295 net of cash, the operating ‘core’ of Apple has a 2011 p/e of 13. Rival shares are so much pricier.”
Read more in the full article here.
[Thanks to MacDailyNews Reader "Sarah" for the heads up.]