The Motley Fool’s Lomax: Apple’s increasingly looking like a red-hot stock idea

“I’m a lifelong Mac user, but my ardor for Apple’s (Nasdaq: AAPL) stock has been cool. It just always looked too expensive, way too hot to handle,” Alyce Lomax writes for The Motley Fool. “Times have changed, though, and Apple’s increasingly looking like a red-hot stock idea. (Pardon me while I dig around the Necco Sweethearts for the ‘Awesome’ Conversation Heart.)”

Lomax writes, “Apple shares have fallen more than 30% since the start of the new year, and they’re well below their 52-week high of $202.96. Apple is trading at just 28 times trailing earnings, and 21 times forward earnings — quite uncharacteristic, considering the company’s growth rates. (It’s still expected to deliver 20%-plus annual growth over the next five years, and it’s not too hard to imagine Apple exceeding such expectations, given its strong brand and track record of innovation.)”

Lomax writes, “Plus, Apple’s loaded with cash. It’s got $18.45 billion, or a little more than $20 per share, and no long-term debt. In these troubled times, zero debt is a doubly sweet concept.”

Much more here.

We’ll briefly address the negatives that you’ll find presented in the full article:

• Is iPod growth slowing or is it really transitioning into a higher margin multi-touch mobile platform?
• Does Apple really care about Amazon encroaching on their barely-above-break-even iTunes Store when all it will do is help sell more iPods and iPhones with which Apple actually profits?
• Is the MacBook Air really “underwhelming,” Alice or – as with the previous two points – are you just not quite getting it?

The other “negatives” Lomax presents (Jobs’ ego and last year’s iPhone price cut/store credit) are meaningless old canards.

13 Comments

  1. Most Analyst look stupid after trying to look at Apple stop or at Apple because they just don’t get it. Even the institutionally investors don’t get it. Which is AAPL is down from it’s high of 202.96. Every time AAPL drops below $124.00 I’m buying back the few hundred shares I sold at over $155.00 last year.

  2. this is going back to 90 a share

    the party is over

    wall street wants to kill Apple

    they like their RIMM hate steve hate MDN

    and they HATE AAPL

    down over 30% this year and it is over

    SELL AND NEVER BUY AGAIN EVER!!!!!!!

  3. The big boys want to scare the small investors into selling so the big funds can buy the Apple stock and run it up. Sometimes the hedge funds decide to play with other stocks for awhile, like now. Apple is still hitting on all 12 cylinders. It has a plan and is generally delivering on time. It is still one of the best companies around. One day Apple will have a higher market cap than Microsoft. It is just a matter of time. Apple will be $600 per share. The patient and loyal will do quite nicely. MTFBWY

  4. Apple fell because of investor FUD coupled with the usual paranoia of short-term holders among other things. Apple is one of very few companies that has ZERO debt. I’d like to see Microsoft try to go debt free. ” width=”19″ height=”19″ alt=”tongue laugh” style=”border:0;” />
    So if you don’t own Apple, buy Apple AND KEEP IT A WHILE. Ok?

  5. @iMacDave
    “Apple is one of very few companies that has ZERO debt. I’d like to see Microsoft try to go debt free.”

    If you would like to see that, check the ‘Total debt’ on the Microsoft balance sheet:
    http://finance.google.com/finance?fstype=bi&q=NASDAQ:MSFT

    Here are some of the very few companies that have ZERO debt:
    MICROSOFT CP, GOOGLE, APPLE INC, SAP AKTIENGESELL , TEXAS INSTRUMENTS, EBAY INC, STRYKER CP, INFOSYS TECHN ADS, ADOBE SYSTEMS INC, ELECTRONIC ARTS, T ROWE PRICE GROU, FOREST LABS CL A, REED ELSEVIER ADS, NVIDIA CORP, PAYCHEX INC, INTUITIVE SURG IN, APOLLO GP INC A, BROADCOM CORP CL , COGNIZANT TECH SO, C.H. ROBINSON WW, BAIDU.COM, INC., AUTODESK INC, GRUPO AEROPORTUAR, ANALOG DEVICES, EXPEDITORS INTL, AGNICO EAGLE MINE, BED BATH & BEYOND, ACTIVISION INC, KL A-TENCOR CP, NAVTEQ CORP, CITRIX SYSTEMS, DISCOVERY HLDNG A, FASTENAL CO, FOCUS MEDIA HOLDI, ALLIANCEBERNSTEIN, YAMANA GOLD INC, KBR INC, MCAFEE, INC, COVANCE INC, LOGITECH INT SA, URBAN OUTFITTERS , CHECK POINT SOFTW, AMER EAGLE OUTFIT, TERADATA CORP, CHGO BRIDGE & IRO, KINDER MORGAN MNG, TITANIUM METALS C, COPART INC, SYNOPSYS INC, ENDO PHARM HLDGS , DEVRY INC, CTRIP.COM INTL LT, NDS GROUP PLC ADS, INTERSIL CORP CLA, ERIE INDEMNITY A, ALLEGHANY CP, GEN-PROBE INC, MORNINGSTAR, INC., CREE INC, INTERACTIVE DATA , TECHNE CP, HOLLY CP, PHARMION CORP, PAN AMER SILVER C, PHILLY CONS HLDS, FACTSET RESEARCH , ABRAXIS BIO NEW, DNP SELECT INCOME, STRAYER EDUCATION, TERRA NITR CO COM, COMPUWARE CORP, INDIA FUND (THE), GENTEX CP, BIOVAIL CORP, LULULEMON ATHLETI, NEW ORIENTAL EDUC, VALUECLICK INC, NATL INSTRUMENTS , GIANT INTERACTIV , POLYCOM INC, ZEBRA TECH CL A, FOUNDRY NETWORKS , QLOGIC CP, IMMUCOR INC, TESSERA TECHNOLOG, F5 NETWORKS INC, CALAMOS STRGC TTL, TERADYNE INC, AEROPOSTALE INC, SAN JUAN BASIN RO, B P PRUDHOE BAY U, EV TX MGD GL BW F, EATON VANCE TAX A, EATON VANCE TAX A, CHICO’S FAS INC, NETFLIX INC, THOR INDS INC, SILICON LABS INC, MICROSEMI CP, MYRIAD GENETICS, NICE-SYSTEMS ADR, WEBMD HEALTH CORP, GRUPO AEROPORTUAR, OPTIONSXPRESS HOL, EATON VANCE LTD D, RIVERBED TECHNOLO, ABERDEEN ASIA-PAC, CENTRAL FD CDA CL, GABELLI DIV & INC, NUVEEN MS I&G;FD , QUEST SOFTWARE IN, INTEGRATED DEVICE, ANNTAYLOR STORES , DECKERS OUTDOOR C, ATHEROS COMMUNICA, GABELLI EQUITY TR, HEARTLAND EXPRESS, CORP EXEC BOARD C, NUVEEN QUAL PFD 2, MIRAMAR MINING CP, KNIGHT TRANS INC, LIFECELL CP, DENISON MINES CP , ARENA RESOURCES, NUVASIVE, INC., EMULEX CORP, SYNTEL INC, ADVENT SOFTWARE, WERNER ENTERPRISE, MERIDIAN BIOSCIEN, THQ INC (DE), HITTITE MICROWAVE, PANERA BREAD A, ECLIPSYS CORP, HUB GROUP INC A, HECLA MINING CO, HEALTHEXTRAS INC, ARBITRON INC, TEMPLETON GLOBAL , HEALTHSPRING INC., BUCKLE INC, NUSTAR GP HGS UTS, GMARKET, ARTHROCARE CP, GYMBOREE CP (THE), VERIGY LTD., APPLERA CP-CELERA, BLUE COAT SYS INC, DEALERTRACK HOLDI, LIBERTY ALL STAR , BEBE STORES INC, COHN & STEERS, MPS GROUP INC, ADAMS EXPRESS CO, NUVEEN MLT STR I&, HUGOTON ROYALTY T, NUVEEN EQ PREM OP, WILLIAMS PIPELINE, HIMAX TECHNOLOGIE, COHEN & STEERS RE, EV TAX MGD BW OPP, COHEN & STRS SEL , MEDICINES CO (THE, SONUS NETWORKS IN, ADVISORY BOARD CO, CHINA DIG TV HDG , A B M INDUSTRIES , TEMPLETON DRAGON , GRUPO CASA SABA, ATMI INC, SYCAMORE NETWORKS, WEIS MARKETS INC, J2 GLOBAL COMM IN, PUTNAM PREMIER IN, CYBERSOURCE CORP, SEABRIDGE GOLD IN, COHEN & STEERS RE, FORMFACTOR INC, CAPELLA EDUCATION, COGENT, INC., PLANTRONICS INC, NORTHERN DYNASTY , UNITED FIRE CASUA, GEN AMER INVEST, TIMBERLAND CO A, CARBO CERAMICS IN, EATON VANCE INS M, BLKRK GLBL E&R;TR, TRIAN ACQ I CORP, CALAMOS CV & HIGH, HEALTHCARE SVCS G, BANKRATE INC, ALIGN TECHNOLOGY , AVID TECH INC, QUALITY SYSTEMS I, DSW INC., NICHOLASAPPLGT CV, MS INDIA INV FD, EATON VANCE ENH E, NUTRISYSTEM INC, PERMIAN BASIN ROY, NATCO GROUP INC, SAPIENT CP, ADMINISTADORA PEN, HEARTLAND PYMT SY, MICROSTRATEGY CL , LUFKIN INDS INC, SURMODICS INC, BLACKROCK DIV ACH, HARMONIC INC, ANALOGIC CP, SEMTECH CORP, PET RES, OILSANDS QUEST IN, BROOKS AUTOMATION, POWER INTEGRATN, EMPLOYERS HOLDING, PACIFIC SUNWEAR, BLACKROCK WORLD I, A S A LTD, RESOURCES CONNECT, NETGEAR INC, ARIZONA STAR RESO, SHENGDATECH INC, EVERGREEN INCOME , M F S INTRMDT INC, JOHN HANCOCK TAX , DREMAN/CLAYMORE D, CBEYOND INC, CENTRAL EUROPE & , ENBRIDGE ENERGY M, FRONTEER DEV GRP , NUVEEN QUAL PFD I, COSTAR GROUP INC, VITAL SIGNS INC, ASTEC INDS INC, BLUE NILE, INC., WIND RIVER SYS, KORN FERRY INTL, CALAMOS CV OPP & , CHINA NEPSTAR ADS, EATON VANCE EQI F, NICHOLAS -APP CON, SABINE RYLTY TR U, STANDARD MICROSYS, COMMVAULT SYSTEMS, GREENLIGHT CAP. R, ZORAN CP, SYKES ENTERPRISES, COGNEX CP, K SWISS INC CL A, NATL WESTERN LIFE, TEMPLETON EMRG MK, MEXICO FUND INC, BLACKROCK MUN INC, WNS (HOLDINGS) LI, BLACKROCK DIV ACH, TRIQUINT SEMICON, GLOBAL SOURCES LT, ABAXIS INC, GREAT BASIN GOLD , SAFETY INS GRP IN, NUVEEN EQ INC FUN, FORRESTER RESRCH, PIONEER DRILLING , ORBOTECH LTD, OMNICELL INC, DORCHESTER MINLS, COHEN & STEERS QU, JOHN HANCOCK FD I, … sorry only 5000 characters allowed

  6. As the post with all the stock listing points out, there are a great deal of companies with zero debt and lousy stocks.

    I don’t know if or when Apple will come back but it would be risky if not stupid to buy it now. Wait until it shows some strength.

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