“It is no secret that the information technology sector has been one of the favorites with investors. The sector has been leading the market higher and strong revenue and earnings growth rates from IT continue to draw attention. Investors are still hungry to make a profit in tech, but one could get a nose bleed as many stocks are reaching all time highs,” Steven Cress writes for Forbes. “Tech shares have outperformed other sectors by a large margin, adding value to an otherwise unexciting market. Investors put $4.7 billion into ETFs that track technology in May alone, part of a $10.2 billion influx for the year according to Jeff Cox of CNBC.”
“As of June 8th, Dow Jones Indices reports that IT is up 13.56% vs. the S&P 500 up 3.94% year-to-date. Many investors are becoming weary of chasing stocks after such a rally. The goal to earning a profit is to buy low and sell high,” Cress writes. “Investors often find it difficult to spot the stocks with fair prices that have great value.”
“It may be hard to believe, but Alphabet Inc., the parent company of google, has only edged slightly higher than the S&P 500 over the last 52 weeks, outperforming by 16.76% vs. 14.19% respectively… We still believe the company is a good buy in the technology sector,” Cress writes. “When an investor thinks of consumer technology, Apple is a company that immediately comes to mind… The overall CressCap rating for the stock is an A+. In our opinion, the valuation on the stock looks favorable.”
Read more in the full article here.
MacDailyNews Take: Apple shares remain grossly undervalued.
Apple’s P/E is 18. Google’s P/E is 63. Data-harvesting and ads are proving to be a lot more valuable than selling hardware.
Google’s comparatively higher visibility probably also helps P/E stay high.
look again at Google’s SEC filings. Google is an ad company and dataminer, yes. but an increasing % of profit comes from cloud services. not to consumers, but to businesses. Apple is a key customer, as are most large companies.
the Fortune 500 could operate just fine without Apple. by outsourcing their in house server operations to Google, Amazon, and Microsoft however, they cannot operate without these cloud purveyors. Apple can’t even run its business without all these “partners”.
That, as well as Apple’s inabilities to keep more than one product line fresh for more than 3 years at a time, is why Apple under Cook doesn’t garner the investor interest that you think they should. it is not convincing that Apple is putting more effort into low margin news and audio distribution than technical innovation, funding crappy movies and tv shows rather than maintaining its former position as best quality computer hardware and software maker for all users from entry level, education, through servers and supercomputers. Apple didn’t even have enough foresight to get its icloud to work as an integrated system. to this day, it’s a patchwork mess of outsourced services from other companies including Google.
put it another way: wall street traders buy their secretaries and mistresses apple watches and annual iphones with their pocket change and it makes them happy once a year. riding the never ending cloud growth makes them happy all year long. they use google info, servers, maps, etc every second of every day. Apple users might buy an annual iphone update and 15% or whatever will pay an monthly fee for Apple’s canned pop music feed. Apple thinks it’s going to get FDA approval to claim the watch is a health device. whatever. Apple lost its market position everywhere else. Lack of product improvements elsewhere show Apple’s coasting and losing momentum. the easy app store profits have made apple fat dumb and lazy.
Once again False Equivalence.