“I allow only one deviation from my focused deep-value contrarian investment strategy,” Achilles Research writes for Seeking Alpha. “And that deviation is called Apple.”
“Apple remains the one and only ‘true’ growth investment in my portfolio of contrarian equity bets. Inconsistency? Hardly,” Achilles Research writes. “While Apple clearly is the best example of a convincing growth story, the company also displays all the characteristics of an undervalued quality company: Apple drives innovation in the consumer electronics industry, sets new design standards, drives a hugely successful differentiation strategy leading to premium prices for its products, creates significant brand equity value, has a pile of cash on its balance sheet that is higher than the tower of Babel and conducts opportunistic and substantial share repurchases. At the same time, Apple trades at only 11 times forward earnings and approximately 9 times estimated 2014 free cash flow to equity.”
“Given the hype about Apple’s tech products, strong free cash flow growth and a treasure trove full of cash to fund a massive share repurchase program, I think Apple is seriously undervalued,” Achilles Research writes. “I also like to remind readers that Apple traded at $700 just one and a half years ago indicating that the market already identified Apple’s outstanding growth potential.”
Read more in the full article here.
[Thanks to MacDailyNews Reader “Arline M.” for the heads up.]
Apple traded above $700 when a bubble in Apple stock developed. Does that mean it was ever worth that much based upon rational valuation? No.
Stopped buying Apple stock in the low- mid $300’s/share. My only regret is not buying more sooner.
I dont believe u understand rational valuation !
Rational observation. Rare around here.
Why Apple Is Heading To $700.
Well, first let Apple rallies back to its old high.
http://seekingalpha.com/article/2154753-why-apple-is-heading-to-700
Finally some common sense – period.
It will never exceed its historic value by much. There’s FAR more money to be made by buying cheaper and selling for profit *ad infinitum*, than there is by sitting on stock and praying it appreciates enough for you to make a profit.
Seriously, that’s why Apple stock keeps fluctuating, not because of rumours or finance-related announcements. Only way to mitigate sellouts around those periods is to announce dividends coming after them, to minimize short selling of the stock.
I have two share trading accounts, both holding AAPL. One account has shares that were bought and held ( some were bought way back when AAPL traded at $49 ). The other account is used to buy and sell AAPL when I perceive there to be predictable fluctuations, for instance selling during the excitement immediately prior to a new product launch and then buying back again after AAPL drops following the market’s negative reaction to anything new. There are often two or three times in a year when it’s possible to sell AAPL and then use that money to buy about 10% more AAPL within a month or so.
It’s that second account that is my star performer. I have no complaints whatsoever about the performance of the AAPL I’ve bought and held, but it’s totally eclipsed by the performance of the actively traded shares. I would prefer to simply invest in Apple and let my money work that way, but speculators are distorting the system, so I decided to try and exploit some of those artificial short term trends.
Financial report time often offers a good opportunity to sell and subsequently buy AAPL, but this quarter, I haven’t sold because I don’t anticipate a significant shift.
Be calmed and collected Apple shareholders. Tomorrow will be a great day for GREEN Apple as Apple (AAPL) Poised to Beat Earnings Estimates.
http://finance.yahoo.com/news/apple-aapl-poised-beat-earnings-151011740.html?soc_src=mediacontentstory
http://finance.yahoo.com/video/apples-quarterly-earnings-set-beat-221618986.html?soc_src=default