Nothing’s Any Better

Stock (Symbol) Stock Price

Apple (AAPL)


Data is as of Expected to Report Sector

August 23, 2013



Sharek’s Take
David SharekApple’s stock has now turned the corner and has momentum. The problem is the numbers continue to decline and there’s no reason to think this will be a $700 stock anytime soon. This $500 stock is worth $550. Last quarter Apple sold 19% more iPhones than it did a year ago. iPad sales fell 14% and Mac sales fell 5%. Profits fell again. Apple has a P/E of 11 and I feel it is worth 13 times earnings, as profits continue to fall.
s e-Year Chart

AAPL_2013_Q3You can clearly see the saucer in AAPL’s one-year chart. This is positive for the stock. The bad news is the negative profit growth, which is set to continue six more months. AAPL has been rising because the stock is a value.

Earnings Table

AAPL_2013_Q3_EPSSales rose only 1% last quarter, profits declined 27%.

AAPL beat by 15 cents but these estimates were slashed twice earlier. This Earnings Table is a sea of red.

Annual Profit Estimates
continue to fall. The company has yet to turn the corner fundamentally.

Quarterly estimates look bad until four quarters out, but these will probably evaporate too.

Fair Value
AAPL_2013_Q3_PHI see AAPL continuing to sell for 13 times earnings. Since the company’s fiscal year-end is in September, I’ve already looked ahead to 2014. This $500 stock has around 10% upside.
Ten-Year Chart
AAPL_2013_Q3_10yrNegative 11% profit growth is expected for the year, that stinks. This stock was a winner for many years, and now needs new products to pump up profitability. Where is the Apple TV? The iWatch?
60% in Power Ranking Bottom Line
Growth Portfolio

23 of 24

AAPL stock is now moving higher — because it was a bargain. Still, the company has not improved its fundamentals, and without that cannot stage a move back to $700. I see another 10% upside for this stock.

AAPL is ranked 23rd in the 24 position Growth Portfolio Power Rankings and last in the Aggressive Growth Portfolio Power Rankings. This stock doesn’t have what it takes to be a market leader.
Aggressive Growth Portfolio

12 of 12

Leave a Comment

Your email address will not be published. Required fields are marked *

Not a member? Sign up here for $25 a month.