“At $86 a share, Apple is now trading on just 16 times forecast earnings, the lowest level in years,” Brett Arends writes for The Wall Street Journal.
“That’s pretty modest. Shares no longer requires much growth to justify the share price. And that $86 includes about $18 per share in net cash and equivalents. The company enters the downturn with a solid balance sheet and a matchless global franchise. And, importantly, Apple has barely begun selling to the billions of emerging consumers in Asia. Collapsing prices of components, incidentally, will also be great for profit margins and may help offset slowing sales,” Arends writes.
“And Apple may actually do OK among Western consumers, too. Customers will keep coming in. Sure, they may trade down to cheaper models, but they probably won’t switch to PCs. They far prefer Apple’s products and customer service — and with good reason,” Arends writes.
“And although Macs may cost more up-front than PCs, they may even work out cheaper in real terms over time because they are apt to have fewer problems,” Arends writes. “As I was reminded recently, when I needed to buy a laptop. Without really thinking, I went to Best Buy and bought a PC made by a respected manufacturer.”
In the full article, Arends describes his problems; in a nutshell: bad news.
Arends writes, “So I went straight out and did what I should have done at the start – I bought a Mac. Bliss.”
Full article here.
[Thanks to MacDailyNews Reader “dslarsen” for the heads up.]