Upgrade This?

Stock (Symbol) Stock Price

Apple (AAPL)


Data is as of Expected to Report Sector

November 11, 2013

Jan 23 – Jan 30


Sharek’s Take
David SharekApple jumped $15 to $566 today as the stock got upgraded to Buy at a brokerage firm. I’m not big on brokerage research, and decided to do my own. I think AAPL is worth $608 next year, and at $566 less than 10% upside. The truth is Apple grew sales only 4% last quarter, and I’m not excited about that. I feel the stock will continue higher because it has momentum but these aren’t the same AAPL shares that shot higher years ago.
One-Year Chart

AAPL_2013_Q4I just don’t see a lot here. The P/E of 12 is partially deserved because AAPL can’t be depended on to put out the earnings its supposed to. All the quarterly estimates are in red — yuck.

Earnings Table

AAPL_2013_Q4_EPSEarnings table is looking better. Although profit growth was -5% and sales growth was only 4%.

AAPL beat the street by 64 cents, but these estimates had been slashed the three quarters prior.

Annual Profit Estimates
finally moved higher!

Quarterly estimates are bad for the next two quarters, and maybe after that profit growth can resume. These numbers increased too.

Fair Value
AAPL_2013_Q4_PHI see this stock being worth 14 times earnings. That’s $608 a share. The stock’s almost there now.
Ten-Year Chart
AAPL_2013_Q4_10yrThis has been a phenomenal stock for the last decade, but profits fell 10% last year and are expected to rise only 9% this year. That’s not top-tier growth stock material.
60% in Power Ranking Bottom Line
Growth Portfolio

23 of 25

Apple now has momentum, but these numbers aren’t all that great. The only good thing is at least estimates increased for a change. I feel this stock isn’t a growth stock anymore and has limited upside.

AAPL is ranked 23rd of 25 stocks in the Growth Portfolio Power Rankings. I sold the stock from the Aggressive Growth Portfolio recently.
Aggressive Growth Portfolio


Leave a Comment

Your email address will not be published.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

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