Apple stock is a steal even at $700

“Much time has been wasted stressing over the latest operating moves Apple might make,” Michael Nielsen writes for Seeking Alpha. “I try not to waste time analyzing company pricing strategies or product designs – these strategies can be debated infinitely and there still will not be a ‘right’ or ‘wrong’ answer.”

“I am an investment analyst, so I focus on factors that may or may not make a good investment. It does not matter if Apple makes the ‘perfect’ decision when it comes to its product strategies; all that matters is if the company is currently overvalued or undervalued,” Nielsen writes. “Of course an analyst must analyze and understand the subject company’s strategy, but the majority of his or her time should be spent conducting financial analysis – after all, he/she is a finance expert, not a VP of Software Engineering. As financial professionals we should focus on our area of expertise: valuing countries, industries and companies.”

With that said, here are the 3 reasons buying Apple is a smart trade:
1. Based on my financial models, Apple is grossly undervalued
2. The possible positive catalysts are more probable and significant than the negative catalysts
3. The risk-reward of the trade is solid

Much more in the full article here.

Related article:
Jim Cramer: These Apple jitters are for naught – February 5, 2014


  1. If Apple can’t prove itself it can grow ,not just Tim said every day i
    From 2012 that the amazing products is coming , now paying itself of 12 YEARS of what Apple will earn would be more than enough .
    The market is all about future which is measured by growth .

  2. Don’t fall for the tricks of WlStreet manipulators, the stock is actually either reasonable or overvalued, but vulnerable to spikes.

    Apple should seriously diversify its portfolio more, not rely on a very small number of devices/services in an increasingly more competitive tech market. Personally I think Apple should create separate structures like for software production not a part of iOS/OSX development and accessories/research.

  3. Oh, please. It is so annoying hearing talk about what Apple’s share price SHOULD be. Lots of people said Apple was undervalued at $550 and look where this crap stock is now. Yeah, sure it’s another buying opportunity. I hear this again and again. Give it a rest. Buy the stock if you want to get some dividends but don’t continue saying it’s a great buy. It’s a mediocre buy at best. I bought it when it was a bargain below $100 a share and Steve Jobs looked invincible.

    Now, every little turd with an opinion can send Apple’s stock plummeting into oblivion even while the company is raking in huge amounts of cash. I’m not blaming Apple completely but the company now has the poor reputation of not returning cash to shareholders which automatically makes it a poor investment for recent investors. There are so many truly mediocre stocks outperforming Apple over the past year it’s criminal.

    I’m completely in the dark about what Apple is doing and probably so is everyone else, but when I see a company sitting on a mountain of cash and then struggling to make revenue numbers, something stinks to high heaven. Apple has more wealth than most conglomerates and yet can only see fit to rely on one product to bring in most of its revenue. Nah, that’s just plain risky. I certainly see why that would give recent investors the jitters. I’m not saying Apple is being poorly run, but I don’t think the company is taking advantage of its cash wealth except to a small degree.

    I have no intention of dumping my Apple shares. I know the company has a future, no matter what others say. Future growth does seem to be a problem if Apple remains the way it is. However, they do have the option of using all that cash to grow the company any way they want and that can change everything in terms of growth.

    All I know is Apple is only worth $700 a share when it reaches $700 a share and right now the stock is worth a stumbling $514 a share and seriously a huge YTD loser yet again.

  4. Small companies grow. The largest publicly traded company by market capitalization: not so much growth potential. At this point, AAPL is a giant dividend paying stock with (optimistically) 100% to 200% growth potential over the next 10-20 years. AAPL is a semi-safe investment with dividend income for someone about 10 years away from retiring – but if your young and looking for real growth, go for small cap stocks. That’s where 1000% – 2000% growth can be found.

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