Analysts agree: Apple Computer stock a great buying opportunity

Apple Store“Apple has long been known on Wall Street as a volatile stock, and this year’s been no different,” Grace Wong reports for “The company has been hit by the widespread stock options backdating scandal plaguing many tech companies. Some investors have also expressed frustration that Apple hasn’t launched a new iPod in some time.”

“Over the past two years, shares of Apple have far outperformed those of H-P Microsoft and Dell,” Wong reports.

“Shares of Apple are down about 6 percent so far this year and are trading more than 21 percent below their 52-week high,” Wong reports. “But analysts are bullish about the company’s growth potential. According to Thomson First Call, 22 out of 25 analysts rate the stock a ‘buy’ or ‘strong buy.'”

“Analysts at Citigroup said in a recent note that the company could launch a redesigned iPod Nano as early as this month. That could coincide with the Apple Expo in Paris, which runs from Sept. 12-16,” Wong reports. “The company remains the undisputed market leader in digital music, with a 76 percent share of the digital music player market, according to market research firm NPD Group… so far, Apple has been successful in fighting off its competition, said Shannon Cross, an analyst at Soleil-Cross Research. ‘The ‘Apple ecosystem’ lends people to keep buying iPods,’ she said, referring to the slew of gadgets and accessories the iPod has spawned as well as its popular iTunes music store.”

“While Apple is far and away the leader in music, that’s not the case in the personal computer market. Apple has only about a 5 percent share of the PC market in the U.S., according to research firm IDC. But sales have been growing at a double-digit pace,” Wong reports. “Apple’s easy-to-use software, which includes popular programs for managing music and photos, as well as its competitive pricing and reliable operating system, should help the computer maker gain market share worldwide, analysts from Citigroup wrote in a recent note.”

Wong reports, “Analysts said the company’s valuation is justified. ‘Nobody has a multiple quite like Apple, but there’s a good bit of expectation that they’re going to be able to sustain that top line growth,’ said Mark Demos, a research analyst with Fifth Third Asset Management, whose firm owns shares of Apple. Analysts surveyed by Thomson First Call expect sales to jump 19 percent in fiscal 2007 with earnings soaring 27 percent year-over-year.”

Full article with charts and more info here.

Related article:
Bear Stearns reiterates ‘outperform’ rating on Apple Computer with target price of $88 – August 29, 2006


  1. As usual, the journalists get it wrong. It is revenues, not earnings, that have soared 27%. Earnings have risen 45%, year-on-year.

    As for expecting 19% sales growth in 2007.. that’s simply laughable, and will require a massive upgrade after the next quarter’s earnings are out in October. Sales are going to rise a massive 40%+ IMHO, and AAPL will double by next Christmas.

  2. The stock market is a crap shoot. I like Apple, but I don’t trust Wall Street. Too much fraud and not enough roi. Especially when you consider that it’s Wall Street that’s responsible for job shifting to cheap labor markets. It used to be that what was good for Corporate America was good for America. Now, they’re all multinationals looking to pay the lowest possible wage while getting the highest possible price for their products. There’s no value for America in that. Unfortunately, they’re able to use individual greed to harm the nation as a whole, and there doesn’t appear to be any way to stop them from stripping America’s wealth.

  3. Not only is America’s wealth at an all-time high, but it is growing at a very fast pace. Besides, the notion that there used to be a time when big American companies were happy to pay higher wages than they had to is just plain silly.
    Sorry to be harsh, but you needed it.
    ” width=”19″ height=”19″ alt=”wink” style=”border:0;” />

  4. RE: Slow News Day?

    If we have a flame war, at least keep it more on topic ” width=”19″ height=”19″ alt=”wink” style=”border:0;” />

    Gates Lied
    Balmer Lied
    Allchin Lied
    Enderle Lied
    Thurrott started to lie, then told the truth, and now is back to lying
    Dvorak, ah, never mind, who cares

  5. Peterson,

    Did you just pull this stuff out if your butt?

    Poor customer care? Apple is consistantly and historicaly been the tops in the industry.

    Marketing Fraud? Exactly which marketing has been fraudulent?

    Under performing iLife software? How exactly is it underperforming? as compared to what?

  6. Kate, get your own clue. The middle class is disappearing. The overall wealth of the country is impossible to measure, and any attempt will be skewed upwards by the super rich, most of whom have vast amounts of their wealth invested elsewhere.

    There is nothing wrong with wanting to pay less, but it’s been taken to a new, unfeasable extreme. What corporations are essentially saying is that they’ll pay the market rate for the cheapest labor market, but they expect the workers to pay the market rate of the highest market for their products. That’s not sustainable in the long term, and it hurts America security and prosperity in the short term. Even places like India will be hurt, because there are cheaper markets to shop jobs out to. Americans have been fooled into thinking that making multinational corporations rich helps everyone, and it just doesn’t.

  7. In the article look at the 2-year stock chart. It shows AAPL right at the 300% growth mark.

    Now read the last line of the article: “…over the past two years, the stock has tripled in value, far outperforming its competitors.”

    Uhm, yea 300% is triple 100% so it must’ve tripled!?

    lol does anybody really care about these little things?

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