How Apple shares can hit $547 in 9 months

“I suspect the majority of [Apple’s China] sales came from just the 4 Apple-owned stores,” Eric Jackson blogs for Forbes. “If that’s true, it would be astounding: 4 stores accounting for at least $1.3 billion in sales in the quarter. That would mean each store is on a $1.3 billion annual revenue run rate.”

“With only 4 stores in Asia and the Chinese gaga for Apple, you would think the company would be building more stores and they are. The company plans to boost the total to 25, with new stores scheduled to open later this year in Shanghai and Hong Kong,” Jackson writes. “50% of $2.6 billion is $1.3 billion or $325 million per store per quarter. That means the planned 25 stores could be selling $32 billion a year. And we haven’t counted third-party, carrier and online sales.”

Jackson writes, “With just the existing planned China stores described above and 30% growth in their rest of world business from last year, it is indeed very possible that Apple can do $117 billion in 2011… In 2010, Apple did $65 billion in revenue (through end of September 2010) for the year and $14 billion in net income. Assume the same margin on $114 billion and you get to $24.5 billion in net income for this calendar year (2011). Assuming the same trailing 20x P/E which Apple has now, and Apple’s stock price by the end of January 2012 will likely be $547/share.”

Read more in the full article here.

[Thanks to MacDailyNews Reader “Jen” for the heads up.]


    1. Yea, me to ….. And I think we will prevail, I mean they have sold zero and we have tens of millions of users, yea I like our position!

      Now don’t get me wrong, I mean they will ……..

  1. One year ago today AAPL closed at $235 and some change . . . with a bunch of people (trolls?) here on MDN saying it would NEVER reach 300! (Some of the most acerbic, vitriolic posts to this effect focused on Jim Cramer and his prediction of $300 before the end of the year.) NOW we see someone wondering about $450+ by year’s end . . . any trolls want to take THIS bait?

    1. I’m an Apple shareholder and it’s really difficult to believe that Apple will reach even $400 this year looking at its present trajectory. I don’t quite understand what makes Apple shares move upward. Over the past few months, Apple stock has looked so damn weak it’s pathetic. Even a $7 upward movement in a week would at least make some sort of sense. Many of you are saying that upon earnings the stock will just jump up but Apple doesn’t seem to move that predictably. In three months, Apple has moved about $25 even with blowout earnings and analyst’s upgrade after upgrade. Amazon or Netflix can move that much in a week or two with their lofty P/Es.

      I just have a tendency to remain skeptical about all the fan enthusiasm when Apple is making more money than ever and the stock barely moves. Last January, Apple stock started on a tear, but this January through March, nothing. So, I’m just saying that it’s hard to get a handle on when this big share leap is coming. We’ll see on next earnings.

      1. Tough one to figure with all the variables …..

        Long term Apple will go well over even the most published optimistic forecast ……

        What we are witnessing is the next, if you so care to call-it, the next “PC Age” ……

        The tablet, in general, will replace a lot of Laptops and desktops as well ……

        A lot of people only use their computers for a storage, email and games …. The tablet can do all those things and provide simpler applications or APPS at low cost so people will and can actually use them ……

        Apple is leading the way in Tablets and SmartPhones and unlike the PC …. This time they are in the lead, not playing catchup ….

        Apple longterm is a BIG winner!

      2. It does feel very weird. But I think the problem is the unescapable psychological trap around “present trajectory”.

        Since Jan earnings, AAPL is dead flat, while S&P 500’s run up 2.5%. But AAPL’s also up 2.5% measured from one day before Jan earnings. And – oh, by the way – Steve Jobs had just announced he was going on indefinite medical leave again.

        Since Oct earnings, AAPL’s slightly underperformed S&P since the day after the announcement (10.7% vs. 12.7%), but outperformed it quite a bit (18.5% vs. 13.8%) measured from just a week earlier.

        I’ve been in the (much) more profitable “bought *before* the earnings announcement” position in both those cases precisely because of my faith in the company’s long-term prospects.

        And while there’s no way AAPL will maintain a 20 P/E ratio if it were to turn in a $114B 2011, I’d still be *very* happy *quite* a bit south of $547 in 9 months (a >75% annualized ROI).

        Disclaimer: *ridiculously* long AAPL

      3. Of course steve being sick doesn’t help the situation. Then these rumors of no June iPhone, and amazon cloud music, don’t help either. iOS 5 is still top secret, so no excitement builders there. Lion a ways off, with top secret aspects well-kept secrets.

        Then the turmoil in the middle east/Africa, a third front for us troops, unclear us recovery, Japanese cataclysm, and long ipad 2 lines suggesting unmet demand…

        Then in two weeks two big apple execs have left – Bertrand and Allison, the osx guy and head of marketing US…

        So lots of downward pressure.

        And if the great SJ should devastate us with the unthinkable I’m prepared for a 75 to 125 point drop.

        Me, I have $11 grand waiting for the right moment to get in, but for me it’s not yet.

        1. Put the $11 k in NOW. Apple’s announcing quarterlies in less than 3 weeks. The new iPad sales will be announced and you’ll make 3% in less than a month!!!!

      4. Why are you worrying about a piddly $7? Think $50-100 in the next year. Do you think most stocks will be able to give you that year in year out?
        Let’s face it aapl is one of the most volatile stocks around. It gets pumped up, dragged down many times a year but overall it keeps going on up.
        In between aapl hovers over a new baseline. We’re at that now and the stock is primed for a jump. It’s weathered the Job illness scare, the iPad killers and now has completely surprised everyone with the demand for the iPad2.
        The stock will be going up, when really depends on when the brokers decided to pump up the stock. Maybe sometime around earnings report since Apple will have to disclose how many iPads and iPhones it has sold this quarter.
        It’s going to be fun.

  2. While I’m all for Apple hitting $547, Jackson has a big problem with his math. Apple has a SEPARATE line item for Apple Stores, so the $1.3B can’t be due to the stores. It’s just as good, because they are due to sales thru other channels, but Jackson can’t just extrapolate sales that don’t come from the Apple Stores.

    1. I agree- The numbers in the Forbes article can’t be even close to correct. A store in China can’t be selling 43x what a US store sells. Selling $1.3B/yr would mean a single store would have to sell ~$4m/day, or ~$400,000/hour, $100k every 15 minutes. That is obviously not happening at any Apple store.

      — from the article:
      …That would mean each store is on a $1.3 billion annual revenue run rate.  A couple of years ago, across its Western stores, Apple was averaging $30 million per year per store in revenues.

  3. Part of the problem regarding the trading in Apple stock (AAPL) is that wall street buzzeznover everything that is speculated on about Apple. The possible delay of iPhone 5 and iOS 5 as well as component unavailability due to the tragedy in Japan. The supposed iPad competition etc etc. Thet windup scaring each other as well asbother investors. They see Apple as numbers. They really don’t get Apple.

    Nevertheless Apple seems to break out of these doldrums eventually and then Climb rapidly.

    $400 to $450 in one year seems doable.

    climb rapidly.

  4. I was smart to buy AAPL at $19 a share with my student loans back in 2001 & 2002.

    If your in College I recommend buying some AAPL stock. Maybe just a few shares at first. HOLD on to it. Maybe in 10 years it will be worth 10 times what you paid for it today.

  5. “If your in College I recommend buying some AAPL stock. Maybe just a few shares at first. HOLD on to it. Maybe in 10 years it will be worth 10 times what you paid for it today.”

    Try 40 times more. 80% monopoly in smartphone, tablet, tv will produce this.

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Tags: ,