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Welcome to the Hardcore Husky Forums. Folks who are well-known in Cyberland and not that dumb.

Apple's 2 trillion $ Valuation

From a P/E ratio, cash generation model, debt ratio etc why not cheap, it's not out in the stratosphere.

For it to grow into the valuation (if possible) what must continue to happen and happen for them.

From what I can see

1) Continuation of Apple and Samsung essentially having a duopoly on cell phones.
2) Continuation if not increase of Apple App's growing 20-25% a year
3) Apple I pay has to become one of top 3 mobile processing payment ways (either organically or buying their way into one)
4) Apple TV has to become one of top 4 players in way people consume content.

Interesting to me, no where is computing (I pad/Mac) or wearables (Air Buds/I Watch) on that list which 10 years ago would have been two of their biggest bets.
Baseman

Comments

  • BasemanBaseman Posts: 9,832
    Swaye's Wigwam 10,000 Awesomes 5,000 Up Votes 5000 Comments
    godawgst said:

    From a P/E ratio, cash generation model, debt ratio etc why not cheap, it's not out in the stratosphere.

    For it to grow into the valuation (if possible) what must continue to happen and happen for them.

    From what I can see

    1) Continuation of Apple and Samsung essentially having a duopoly on cell phones.
    2) Continuation if not increase of Apple App's growing 20-25% a year
    3) Apple I pay has to become one of top 3 mobile processing payment ways (either organically or buying their way into one)
    4) Apple TV has to become one of top 4 players in way people consume content.

    Interesting to me, no where is computing (I pad/Mac) or wearables (Air Buds/I Watch) on that list which 10 years ago would have been two of their biggest bets.

    I think we see a retreat soon (I'm not selling). Apple's stock buybacks have goosed EPS. At 30X+ forward earnings, buybacks won't have the teeth they've had the past several years. Tim Cook is a finance guy and I wouldn't bet the farm he'll want to use FCF for buybacks at the level they have until the stock returns to a comfortable range.

    After the kids pile into Apple after the split, I'd expect the institutional money and hedge funds to pivot and reduce their holdings.
  • EsophagealFecesEsophagealFeces Posts: 6,184
    Swaye's Wigwam 5,000 Up Votes 5,000 Awesomes 5000 Comments
    It’ll be interesting to see what happens with Epic Games’ lawsuit against Apple. It could cost Apple a lot of future revenue if it doesn’t go their way
  • greenbloodgreenblood Posts: 10,478
    10,000 Up Votes 5,000 Awesomes 10000 Comments Seventh Anniversary
    The key for Apple will be their apps. They can't rely solely on the sale of devices to keep that valuation.
    godawgst
  • PurpleThrobberPurpleThrobber Posts: 22,627
    Swaye's Wigwam 10,000 Awesomes 10,000 Up Votes 10000 Comments
    edited August 25
    Noted: The Dow is price-weighted. Apple's split will drop them down to #17 on the Dow and drag down returns for the tech sector.

    Well played, Tim Cook - your Chinese overlords will be proud of putting a dent in Trump's stock market success claims with your share price shenanigans.

    Wouldn't be surprised if other FAANG members follow suit and announce stock splits between now and Election Day.



    Pitchfork51
  • Pitchfork51Pitchfork51 Posts: 19,287
    10,000 Up Votes 10,000 Awesomes 10000 Comments 250 Answers
    Apple is doomed. They are trying to fight progress by locking in their app store but that's going to go away almost completely in a few years.
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