Big-cap tech stocks like Apple have enjoyed a huge upwards rise during the COVID-19 pandemic, causing some investors to wonder if some Big Tech names are now in dreaded bubble territory.
Just don’t lump Apple (AAPL) into the often heated tech bubble debate, argues Wall Street power player Rob Arnott — known for deeply analytical takes on markets and stocks — founded Research Affiliates in 2002 and it has about $145 billion in assets under management.
“You look at Apple. It’s expensive. But is it a bubble? No no. You can use aggressive [financial] assumptions. They don’t have to be implausible assumptions to justify today’s price, and there’s lots of buyers who buy it based on that kind of analysis,” Arnott said on Yahoo Finance Live…
Arnott may be dead right to say Apple’s stock is not detached from a realistic outlook on the future of the business (excluding an Apple Car). If anything, the stock may continue to be a bargain… At 32 times estimated earnings the stock trades well below comparable multiples for Amazon (58 times) and Netflix (57 times). And of course, Apple shares trade below the 204 times forward price-to-earnings multiple on electric vehicle favorite Tesla (TSLA).
MacDailyNews Take: Apple stock is not a bubble as the shares remain woefully undervalued.
Apple deserves to be worth considerably more than $2 trillion. The company remains significantly undervalued. — MacDailyNews, August 10, 2020
Trillion, schmillion. Over time, Apple will go much higher than that. The company is currently horribly undervalued. – MacDailyNews, March 1, 2018