Why Apple Stock is a sure bet to hit $650 or higher

“Apple stock closed Friday at $532.87, up 1.5% for the week. But the shares are down 4.4% on the year to date compared with the Dow, which is off by only 1.6%,” Richard Saintvilus writes for TheStreet. “Apple’s stock is dirt cheap. Not only are the shares still down 7.5% from their 52-week high, but even when you strip out Apple’s cash, these shares would still command a price tag north of $500.”

“Given the strength of the iPhone 5S and rumored iPhone 6, which is due out later this summer, Apple’s stock remains a sure bet to $650 and higher,” Saintvilus writes. “Assuming that China Mobile sales remain at the current pace, this should spur iPhone device sales by an additional 14 million to 16 million. Apple stock should respond by trading (at least) 18% to 22% higher in the next 12 months. This will place fair-value at around $650 by the beginning to 2015. And this doesn’t even include the highly anticipated iPhone 6, which is expected to be bigger and sport a larger screen.”

“There are those that have switched to Samsung phones due to their larger screens. So Apple is certain to win back those customers,” Saintvilus writes. “What’s more, as China Mobile’s 4G service increases throughout China, this will add incremental growth to Apple’s sales. The Street still has not made this correlation.”

Read more in the full article here.


    1. Because carplay is an unknown business. ie. we have no idea of any licencing terms in place. ie. does Apple charge a made for carplay licence? does Apple pay the car companies to include carplay? Or is it more likely that no money changes hands other than say for integration support from Apple engineers.

    1. Okay. Start with Apple’s share price today of $539.19. Divide by its P/E ratio (13.40), then multiply by Google’s P/E ratio (30.46) to get: $1,226. Apple shares would be worth $1226 if they were valued at Google’s current P/E multiple.

      But let’s forget Google. If Apple shares were valued at a P/E multiple of 25, its share price would be $1000. If Apple shares were valued at a P/E of 20, it’s share price would be $805.

      Apple’s share price “problem” is not its own performance. Apple’s share price problem is “investor sentiment” — whatever that means. Before worrying too much about investor expectations, though, remember that it was Wall Street that almost brought the global financial system down in 2008, so take their collective opinion and behavior with a grain of salt …or better: salt, a shot of tequila, and a lime wedge. It doesn’t have to make sense. It is more a question of herd mentality among investors.

      If something cannot go on forever, it will eventually stop. So keep the faith. Better days are coming.

  1. #1) I am guessing by size and frequency of today’s trades that the institutional investors are POURING MONEY back into AAPL after being on the sidelines because they know something.

    #2) Apple TV -> Native Apps = iOS -> Native Apps
    Remember back when 3rd parties could not release apps Native apps for the iPhone? Apple TV is GOING NATIVE

    #3) iPhone 6 will be the biggest upgrade cycle ever for the existing iPhone user base.

  2. Let’s talk about what happens to AAPL options if Tim Cook announces the iPhone 6 at WWDC on June 11 for release on Friday, June 27. If you start to notice a )*$& ton of calls, this is why.

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