Apple: The most undervalued large-cap stock in America

“In light of the recent sell-off in global equities, it is now an incontestable FACT that Apple is the most undervalued and underappreciated large-cap growth company in America,” Andy Zaky writes for Bullish Cross.

“The stock trades at an extremely depressed valuation that Wall Street isn’t taking seriously (8.25 Forward P/E Ratio), the company’s growth continues to outpace every large cap company on the entire S&P 500, and the company’s growth rate percentage – defying all laws of gravity – continues to accelerate without any sign of abating,” Zaky writes. “Every quarter that goes by, Apple reports another multi-year record high growth rate that continues to be brushed aside and overlooked by investors. Apple’s stock performance relative to its valuation and fundamentals, and relative to other companies with lower growth rates and more expensive valuations is completely abysmal.”

Zaky writes, “Eventually, Apple will hit an inflection point where this 2-year phase of P/E compression comes to an abrupt end. Apple is already valued below the S&P 500. If the earnings continue to come in anywhere close to 50% which is far below the 70-82% we’ve seen in the past 3-years, then the stock will have to rise significantly in order to merely maintain its depressed valuation.”

Much more in the full article here.

11 Comments

  1. The more you pull down on the rubber-band the more it snaps up when you let go. Nice way to make a living if you have the resources to help pull the rubber-band down.

    1. There’s really two “rebound” scenarios:

      The first involves AAPL simply maintaining its depressed value as revenue increases. It will still have to go up to do that. That’s not so much a rubber band effect, as it is the effect of a boat rising slowly on a rising sea. Think EGG curves on a POLTRY analysis adjusted for PBAJ.

      The second, the rubber band effect, is when increasing revenue and other forces cause the depressed valuation to normalize, thereby accelerating share prices more than simply adjusting for a “better worst case scenario.” Think JAM or GIN curves on a BACN analysis adjusted for PBAJ.

      It doesn’t have to be either or. The former could slingshot into the latter, essentially waking the stock up. Or, it could be a combination so the stock improves, P/E improves even more, the stock improves even more, although still somewhat devalued.

  2. How many years has this been? About 8 years!!! Quarter after quarter; every three months — we all can see that AAPL reports record profits and expanding 🙂
    … Buy now as AAPL is going Up $101 per share per year 🙂
    2012 = $555
    2013 = $656
    2014 = $757
    2015 = $861 🙂 Betcha right?

    1. Very reasonable.

      Why do people insist on interjecting logic, reason and (the most verboten) common sense when others are perfectly happy to panic and overreact.

      Geez, some people!

  3. It’s no mystery.
    There are no dividends, and the Wall Street Crims can’t leverage themselves in sufficiently to be able to loot the company and it’s cash reserves. Until such time as there is a way to syphon off the money, there is no percentage in “owning/investing” in the company.
    Share price for them is the buy-in cost of being able to do business. And “Business” means how much debt can you load on a company, which extracting it’s cash reserves.
    It is all simple ratio’s.
    What you have to put in, in order to be able to extract out.
    With no “Cash-out” there is no “value” in for Wall Street and the big money Banksters. (other than capital appreciation – and so that is what Apple is priced at)

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