Apple Stock: At What Price Should You Buy?

seekingalpha2021-03-25

Summary Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me. However, Apple is a great business that remains on my radar. I share the price Apple would ...

Source Link

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

209

Report

Comment（80）

JFK23
·2021-04-13
$135??
Reply
Like
Report
GoodnRich
·2021-04-10
120
Reply
1
Report
Joycelinsng
·2021-04-09
$100!
Reply
1
Report
HLPA
·2021-03-31
Buy AAPL now. You never go wrong
Reply
5
Report
Fold Replies
- HLPA:
  good
  2021-03-31
  Reply
  Report
- LynHuatAh:
  jiah yew !!
  2021-03-31
  Reply
  Report
w8w8
·2021-03-30
Steamed sell fast chepak
Reply
3
Report
Teslawonder
·2021-03-29
I believe 110-115 will be a great opportunity.If you like, Pls give a like and comment for my recent posting.Thanks
Reply
10
Report
Fold Replies
- Teslawonder:
  thanks. Do you like this stock?
  2021-03-30
  Reply
  Report
- TraderGoh:
  Same
  2021-03-30
  Reply
  Report
- Sam87:
  Camping at below 118
  2021-03-29
  Reply
  Report
View more 2 comments
Derrickola
·2021-03-29
Buy now guys tech dropping
Reply
9
Report
Fold Replies
- WarSlasher:
  105
  2021-03-29
  Reply
  Report
- PigsCanFly:
  ok
  2021-03-29
  Reply
  Report
CatFished
·2021-03-28
Apple is a growing company but still this analysis is sound in trying to figure out what is a fair value. True by the recent boom in trade due to the recentstimulus injects is blowing stocks way above what it should be.
Reply
6
Report
MyGunner
·2021-03-28
I bought at high price. Now just have to hold.
Reply
4
Report
LeeKim
·2021-03-28
Got it at $120. Hopefully that's a good price $Apple(AAPL)$
Reply
5
Report
michiec
·2021-03-28
Apple fans here and like their good product, bought at 120, please like my comment, thanks ?
Reply
5
Report
CcccL
·2021-03-28
Not at the current price. Little room for growth as products aren’t new and they aren’t growing market share in these areas much
Reply
6
Report
DingDang
·2021-03-28
Diamond hands, buy at any price! Please like and comment!
Reply
5
Report
Genekun
·2021-03-28
120 is good enough i feel
Reply
4
Report
hahasofunny
·2021-03-27
Got it for free hehe
Reply
2
Report
Fold Replies
- KinKatReplying toTeslawonder:
  At the moment, MooMoo lower fee for US stks, Tiger lower fee for Singapore stks, esp min fees
  2021-03-29
  Reply
  Report
- Teslawonder:
  Any moo moo fans, pls give like and comment on my recent post.
  2021-03-29
  Reply
  Report
- KinKat:
  Moo... Moo... [鬼脸]
  2021-03-28
  Reply
  Report
兔气扬眉
·2021-03-27
Yes
Reply
1
Report
FuJie1010
·2021-03-27
Good idea
Reply
3
Report
Fold Replies
- 兔气扬眉:
  ?
  2021-03-27
  Reply
  Report
kksuen
·2021-03-27
Comment and like pls thanks
Reply
3
Report
Fold Replies
- EV8:
  ??
  2021-03-29
  Reply
  Report
- Tomji:
  Blessings. reply pls
  2021-03-27
  Reply
  Report
LowZackM
·2021-03-27
I will buy anything under 140. Once iPad anouncement+ earnings report, it is going high up
Reply
4
Report
Fold Replies
- LowZackM:
  1st week of April
  2021-03-30
  Reply
  Report
- LowZackM:
  APPL APRIL
  2021-03-28
  Reply
  Report
- Tomji:
  Anyway ide when that is coming out
  2021-03-27
  Reply
  Report
yngwin111
·2021-03-27
85 I will buy
Reply
2
Report
Fold Replies
- Tomji:
  Do you thinknit will drop to $85
  2021-03-27
  Reply
  Report

Most Discussed

7x24

All

Terms and Conditions·Privacy Policy

Company: TTMF Limited. Tech supported by Xiangshang Yixin.

Email：uservice@ttm.financial

{"i18n":{"language":"en_US"},"data":{"share":"https://ttm.financial/m/news/1179353023?lang=en_US&edition=fundamental","thumbnail":"","is_english":true,"pubTime":"2021-03-25 19:52","share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","id":"1179353023","market":"us","top_or_hot":-1,"title":"Apple Stock: At What Price Should You Buy?","media":"seekingalpha","content":"<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Source Link</a>\n\n</div>\n","source":"seekingalpha","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"AAPL","symbol_name":"苹果","start_time":0,"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","article_id":"1179353023","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","pubTimestamp":1616673145,"sourceInfo":{"source_id":"seekingalpha","name":"Seeking Alpha"},"weMediaInfo":null,"summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","collect":0,"end_time":0,"defaultTopTitle":"seekingalpha.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"AAPL":"苹果"},"translate_title":"苹果股票：应该在什么价位买入？","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"AAPL":0.9},"content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","kind":null,"is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[{"id":342753881,"gmtCreate":1618245040043,"gmtModify":1704708136439,"author":{"id":"3577142139469832","authorId":"3577142139469832","name":"JFK23","avatar":"https://static.tigerbbs.com/6bdaa6cc4eddbc577da598bd89525cf0","vip":1,"crmLevel":3,"crmLevelSwitch":0,"idStr":"3577142139469832","authorIdStr":"3577142139469832"},"htmlText":"$135??","listText":"$135??","text":"$135??","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/342753881","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":346215197,"gmtCreate":1618045607919,"gmtModify":1704706309356,"author":{"id":"3578561847510900","authorId":"3578561847510900","name":"GoodnRich","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"crmLevel":3,"crmLevelSwitch":0,"idStr":"3578561847510900","authorIdStr":"3578561847510900"},"htmlText":"120","listText":"120","text":"120","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/346215197","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":348711407,"gmtCreate":1617962570109,"gmtModify":1704705358769,"author":{"id":"3577251918188197","authorId":"3577251918188197","name":"Joycelinsng","avatar":"https://static.tigerbbs.com/fa80264c581342ecd56fa828ec7fcd0f","vip":1,"crmLevel":6,"crmLevelSwitch":0,"idStr":"3577251918188197","authorIdStr":"3577251918188197"},"htmlText":"$100!","listText":"$100!","text":"$100!","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/348711407","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":354836742,"gmtCreate":1617156980786,"gmtModify":1704696541505,"author":{"id":"3569274903458035","authorId":"3569274903458035","name":"HLPA","avatar":"https://static.tigerbbs.com/07e7b987a9127c5a47dbc3ae02db548b","vip":1,"hat":"https://static.tigerbbs.com/646756f1284a5a6480ed02cc4fa7d1d2","crmLevel":8,"crmLevelSwitch":1,"idStr":"3569274903458035","authorIdStr":"3569274903458035"},"htmlText":"Buy AAPL now. You never go wrong","listText":"Buy AAPL now. You never go wrong","text":"Buy AAPL now. You never go wrong","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":5,"commentSize":2,"repostSize":0,"link":"https://ttm.financial/post/354836742","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":3927337,"gmtCreate":1617162131488,"gmtModify":1680782388419,"authorId":3569274903458035,"author":{"id":3569274903458035,"idStr":"3569274903458035","authorId":3569274903458035,"name":"HLPA","avatar":"https://static.tigerbbs.com/07e7b987a9127c5a47dbc3ae02db548b","vip":1,"currentWearingBadge":{"badgeId":"9427a906234c4b18a82ec3d7730b7fa8-1","templateUuid":"9427a906234c4b18a82ec3d7730b7fa8","name":"Star Contributor","description":"Have published 3 or more picked posts, and have published at least one picked post and participated in comments within 30 days","bigImgUrl":"https://community-static.tradeup.com/news/1866dcf97a73be1c330f85862546aedc","smallImgUrl":"https://community-static.tradeup.com/news/4f5c5fa8e2c7683bb5a7fce8753ee456","redirectLinkEnabled":1,"redirectLink":"https://ttm.financial/activity/market/2023/star-contributors/","hasAllocated":1,"isWearing":1,"stampPosition":0,"hasStamp":0,"allocationCount":1,"allocatedDate":"2023.12.02","individualDisplayEnabled":0,"individualDisplaySort":0,"categoryType":2007},"crmLevel":8,"crmLevelSwitch":1,"individualDisplayBadges":[{"badgeId":"9427a906234c4b18a82ec3d7730b7fa8-1","templateUuid":"9427a906234c4b18a82ec3d7730b7fa8","name":"Star Contributor","description":"Have published 3 or more picked posts, and have published at least one picked post and participated in comments within 30 days","bigImgUrl":"https://community-static.tradeup.com/news/1866dcf97a73be1c330f85862546aedc","smallImgUrl":"https://community-static.tradeup.com/news/4f5c5fa8e2c7683bb5a7fce8753ee456","redirectLinkEnabled":1,"redirectLink":"https://ttm.financial/activity/market/2023/star-contributors/","hasAllocated":1,"isWearing":1,"stampPosition":0,"hasStamp":0,"allocationCount":1,"allocatedDate":"2024.10.16","individualDisplayEnabled":1,"backgroundColor":{"dark":"#675a37","tint":"#f9ebc2"},"fontColor":{"dark":"#ffffff","tint":"#ab7a0e"},"individualDisplaySort":0,"categoryType":2007}]},"repliedAuthorId":0,"objectId":354836742,"type":1,"supId":3926759,"prevId":0,"content":"good","text":"good","html":"good"},{"id":3926759,"gmtCreate":1617157866089,"gmtModify":1680782384201,"authorId":3574550675586314,"author":{"id":3574550675586314,"idStr":"3574550675586314","authorId":3574550675586314,"name":"LynHuatAh","avatar":"https://static.tigerbbs.com/901d081dbe36cc6d27f15400f52a7899","vip":1,"crmLevel":2,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":354836742,"type":1,"supId":0,"prevId":0,"content":"jiah yew !!","text":"jiah yew !!","html":"jiah yew !!"}],"langContent":"EN"},{"id":354930671,"gmtCreate":1617116775593,"gmtModify":1704696125637,"author":{"id":"3575859183800572","authorId":"3575859183800572","name":"w8w8","avatar":"https://static.tigerbbs.com/1a305fe39d1c227693a64cc331afda1a","vip":1,"crmLevel":5,"crmLevelSwitch":0,"idStr":"3575859183800572","authorIdStr":"3575859183800572"},"htmlText":"Steamed sell fast chepak","listText":"Steamed sell fast chepak","text":"Steamed sell fast chepak","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":3,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/354930671","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":352708036,"gmtCreate":1617000429025,"gmtModify":1704800637618,"author":{"id":"3574996021054734","authorId":"3574996021054734","name":"Teslawonder","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"crmLevel":2,"crmLevelSwitch":0,"idStr":"3574996021054734","authorIdStr":"3574996021054734"},"htmlText":"I believe 110-115 will be a great opportunity.If you like, Pls give a like and comment for my recent posting.Thanks","listText":"I believe 110-115 will be a great opportunity.If you like, Pls give a like and comment for my recent posting.Thanks","text":"I believe 110-115 will be a great opportunity.If you like, Pls give a like and comment for my recent posting.Thanks","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":10,"commentSize":7,"repostSize":0,"link":"https://ttm.financial/post/352708036","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":3918074,"gmtCreate":1617073277473,"gmtModify":1680782249795,"authorId":3574996021054734,"author":{"id":3574996021054734,"idStr":"3574996021054734","authorId":3574996021054734,"name":"Teslawonder","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"crmLevel":2,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":352708036,"type":1,"supId":3910772,"prevId":0,"content":"thanks. Do you like this stock?","text":"thanks. Do you like this stock?","html":"thanks. Do you like this stock?"},{"id":3916719,"gmtCreate":1617064506729,"gmtModify":1680782238774,"authorId":3568616560578435,"author":{"id":3568616560578435,"idStr":"3568616560578435","authorId":3568616560578435,"name":"TraderGoh","avatar":"https://community-static.tradeup.com/news/8cf7cb21210627baac9b46c649163635","vip":1,"currentWearingBadge":{"badgeId":"972123088c9646f7b6091ae0662215be-3","templateUuid":"972123088c9646f7b6091ae0662215be","name":"Legendary Trader","description":"Total number of securities or futures transactions reached 300","bigImgUrl":"https://static.tigerbbs.com/656db16598a0b8f21429e10d6c1cb033","smallImgUrl":"https://static.tigerbbs.com/03f10910d4dd9234f9b5702a3342193a","grayImgUrl":"https://static.tigerbbs.com/0c767e35268feb729d50d3fa9a386c5a","redirectLinkEnabled":0,"hasAllocated":1,"isWearing":1,"stampPosition":0,"hasStamp":0,"allocationCount":1,"allocatedDate":"2021.12.21","exceedPercentage":"93.17%","individualDisplayEnabled":0,"individualDisplaySort":0,"categoryType":1100},"crmLevel":8,"crmLevelSwitch":1,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":352708036,"type":1,"supId":3913663,"prevId":0,"content":"<u>Same</u>","text":"<u>Same</u>","html":"<u>Same</u>"},{"id":3913663,"gmtCreate":1617027141291,"gmtModify":1680782190086,"authorId":3572775695513464,"author":{"id":3572775695513464,"idStr":"3572775695513464","authorId":3572775695513464,"name":"Sam87","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"currentWearingBadge":{"badgeId":"972123088c9646f7b6091ae0662215be-3","templateUuid":"972123088c9646f7b6091ae0662215be","name":"Legendary Trader","description":"Total number of securities or futures transactions reached 300","bigImgUrl":"https://static.tigerbbs.com/656db16598a0b8f21429e10d6c1cb033","smallImgUrl":"https://static.tigerbbs.com/03f10910d4dd9234f9b5702a3342193a","grayImgUrl":"https://static.tigerbbs.com/0c767e35268feb729d50d3fa9a386c5a","redirectLinkEnabled":0,"hasAllocated":1,"isWearing":1,"stampPosition":0,"hasStamp":0,"allocationCount":1,"allocatedDate":"2021.12.21","exceedPercentage":"93.96%","individualDisplayEnabled":0,"individualDisplaySort":0,"categoryType":1100},"crmLevel":5,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":352708036,"type":1,"supId":0,"prevId":0,"content":"Camping at below <u>118</u>","text":"Camping at below <u>118</u>","html":"Camping at below <u>118</u>"},{"id":3910772,"gmtCreate":1617003528423,"gmtModify":1680782145333,"authorId":3569580504698649,"author":{"id":3569580504698649,"idStr":"3569580504698649","authorId":3569580504698649,"name":"lawgbk","avatar":"https://static.tigerbbs.com/aed8dcf3ce6c592dffc1e60aa40d85bc","vip":1,"crmLevel":4,"crmLevelSwitch":1,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":352708036,"type":1,"supId":0,"prevId":0,"content":"done","text":"done","html":"done"},{"id":6339451,"gmtCreate":1635297613304,"gmtModify":1663235938536,"authorId":3574996021054734,"author":{"id":3574996021054734,"idStr":"3574996021054734","authorId":3574996021054734,"name":"Teslawonder","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"crmLevel":2,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":352708036,"type":1,"supId":3913663,"prevId":0,"content":"fortune making","text":"fortune making","html":"fortune making"}],"langContent":"EN"},{"id":352420047,"gmtCreate":1616995413789,"gmtModify":1704800576291,"author":{"id":"3575765870316438","authorId":"3575765870316438","name":"Derrickola","avatar":"https://static.tigerbbs.com/2e1a91ff1e2c7029f0ea5d952a46bebb","vip":1,"hat":"https://static.tigerbbs.com/b0a2963eb37c60c5d6d4a8dbcd266952","crmLevel":2,"crmLevelSwitch":0,"idStr":"3575765870316438","authorIdStr":"3575765870316438"},"htmlText":"Buy now guys tech dropping","listText":"Buy now guys tech dropping","text":"Buy now guys tech dropping","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":9,"commentSize":2,"repostSize":0,"link":"https://ttm.financial/post/352420047","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":3910761,"gmtCreate":1617003397992,"gmtModify":1680782141334,"authorId":3575195102402470,"author":{"id":3575195102402470,"idStr":"3575195102402470","authorId":3575195102402470,"name":"WarSlasher","avatar":"https://static.tigerbbs.com/0c98b196bb3a5da8bb25c9d45e23a4ce","vip":1,"crmLevel":2,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":352420047,"type":1,"supId":0,"prevId":0,"content":"105","text":"105","html":"105"},{"id":3910147,"gmtCreate":1616995452656,"gmtModify":1680782132892,"authorId":3551844041040809,"author":{"id":3551844041040809,"idStr":"3551844041040809","authorId":3551844041040809,"name":"PigsCanFly","avatar":"https://static.tigerbbs.com/0ab4b860dc502aa5e532bdac3b38ded9","vip":1,"crmLevel":5,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":352420047,"type":1,"supId":0,"prevId":0,"content":"<u>ok</u>","text":"<u>ok</u>","html":"<u>ok</u>"}],"langContent":"EN"},{"id":352851033,"gmtCreate":1616934228722,"gmtModify":1704800059531,"author":{"id":"3572326869934828","authorId":"3572326869934828","name":"CatFished","avatar":"https://static.tigerbbs.com/82e1be890ac35d9383e63c6a0893cc31","vip":1,"hat":"https://static.tigerbbs.com/0a8758340a08196056f8bc1e54805193","crmLevel":7,"crmLevelSwitch":1,"idStr":"3572326869934828","authorIdStr":"3572326869934828"},"htmlText":"Apple is a growing company but still this analysis is sound in trying to figure out what is a fair value. True by the recent boom in trade due to the recentstimulus injects is blowing stocks way above what it should be.&nbsp;","listText":"Apple is a growing company but still this analysis is sound in trying to figure out what is a fair value. True by the recent boom in trade due to the recentstimulus injects is blowing stocks way above what it should be.&nbsp;","text":"Apple is a growing company but still this analysis is sound in trying to figure out what is a fair value. True by the recent boom in trade due to the recentstimulus injects is blowing stocks way above what it should be.","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":6,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/352851033","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":352850549,"gmtCreate":1616933803581,"gmtModify":1704800056783,"author":{"id":"3565301069082159","authorId":"3565301069082159","name":"MyGunner","avatar":"https://static.tigerbbs.com/946429fe15553c46fc12d6e3624240c6","vip":1,"crmLevel":2,"crmLevelSwitch":1,"idStr":"3565301069082159","authorIdStr":"3565301069082159"},"htmlText":"I bought at high price. Now just have to hold.","listText":"I bought at high price. Now just have to hold.","text":"I bought at high price. Now just have to hold.","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":4,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/352850549","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":352835428,"gmtCreate":1616924335264,"gmtModify":1704800003653,"author":{"id":"3577157753646357","authorId":"3577157753646357","name":"LeeKim","avatar":"https://static.tigerbbs.com/19732b3147dce26211e57be67792bc00","vip":1,"crmLevel":2,"crmLevelSwitch":0,"idStr":"3577157753646357","authorIdStr":"3577157753646357"},"htmlText":"Got it at $120. Hopefully that's a good price&nbsp; <a href=\"https://laohu8.com/S/AAPL\">$Apple(AAPL)$</a>","listText":"Got it at $120. Hopefully that's a good price&nbsp; <a href=\"https://laohu8.com/S/AAPL\">$Apple(AAPL)$</a>","text":"Got it at $120. Hopefully that's a good price $Apple(AAPL)$","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":5,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/352835428","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":352832767,"gmtCreate":1616924101859,"gmtModify":1704800002847,"author":{"id":"3576840215575990","authorId":"3576840215575990","name":"michiec","avatar":"https://static.tigerbbs.com/a4ab42a03acfbe58db7e84b49daf9682","vip":1,"crmLevel":2,"crmLevelSwitch":0,"idStr":"3576840215575990","authorIdStr":"3576840215575990"},"htmlText":"Apple fans here and like their good product, bought at&nbsp;120, please like my comment, thanks ?&nbsp;","listText":"Apple fans here and like their good product, bought at&nbsp;120, please like my comment, thanks ?&nbsp;","text":"Apple fans here and like their good product, bought at 120, please like my comment, thanks ?","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":5,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/352832767","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":352800344,"gmtCreate":1616919051888,"gmtModify":1704799966642,"author":{"id":"3566877420609993","authorId":"3566877420609993","name":"CcccL","avatar":"https://static.tigerbbs.com/27eb54773a8f0b3851def7cabc15cb0e","vip":1,"crmLevel":2,"crmLevelSwitch":0,"idStr":"3566877420609993","authorIdStr":"3566877420609993"},"htmlText":"Not at the current price. Little room for growth as products aren’t new and they aren’t growing market share in these areas much","listText":"Not at the current price. Little room for growth as products aren’t new and they aren’t growing market share in these areas much","text":"Not at the current price. Little room for growth as products aren’t new and they aren’t growing market share in these areas much","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":6,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/352800344","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":352143128,"gmtCreate":1616912711864,"gmtModify":1704799943066,"author":{"id":"3553254172092293","authorId":"3553254172092293","name":"DingDang","avatar":"https://static.tigerbbs.com/d2a0c38ce6f3c2661fa15b7d1f52eeaf","vip":1,"crmLevel":2,"crmLevelSwitch":0,"idStr":"3553254172092293","authorIdStr":"3553254172092293"},"htmlText":"Diamond hands, buy at any price! Please like and comment!","listText":"Diamond hands, buy at any price! Please like and comment!","text":"Diamond hands, buy at any price! Please like and comment!","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":5,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/352143128","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":352153726,"gmtCreate":1616911200965,"gmtModify":1704799930246,"author":{"id":"3562062018050031","authorId":"3562062018050031","name":"Genekun","avatar":"https://static.tigerbbs.com/ffb91ce7286a4dd47ea48415366d485f","vip":1,"crmLevel":5,"crmLevelSwitch":1,"idStr":"3562062018050031","authorIdStr":"3562062018050031"},"htmlText":"120 is good enough i feel&nbsp;","listText":"120 is good enough i feel&nbsp;","text":"120 is good enough i feel","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":4,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/352153726","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":352919382,"gmtCreate":1616854282146,"gmtModify":1704799611361,"author":{"id":"3574937645011763","authorId":"3574937645011763","name":"hahasofunny","avatar":"https://static.tigerbbs.com/963a75c4fa646a8f0e5ab52ab5a03022","vip":1,"crmLevel":2,"crmLevelSwitch":0,"idStr":"3574937645011763","authorIdStr":"3574937645011763"},"htmlText":"Got it for free hehe&nbsp;","listText":"Got it for free hehe&nbsp;","text":"Got it for free hehe","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":2,"commentSize":3,"repostSize":0,"link":"https://ttm.financial/post/352919382","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":3910878,"gmtCreate":1617004655864,"gmtModify":1680782142825,"authorId":3577917165320806,"author":{"id":3577917165320806,"idStr":"3577917165320806","authorId":3577917165320806,"name":"KinKat","avatar":"https://community-static.tradeup.com/news/303a11363633244c53e6b67003899c74","vip":1,"currentWearingBadge":{"badgeId":"a83d7582f45846ffbccbce770ce65d84-1","templateUuid":"a83d7582f45846ffbccbce770ce65d84","name":"Real Trader","description":"Completed a transaction","bigImgUrl":"https://static.tigerbbs.com/2e08a1cc2087a1de93402c2c290fa65b","smallImgUrl":"https://static.tigerbbs.com/4504a6397ce1137932d56e5f4ce27166","grayImgUrl":"https://static.tigerbbs.com/4b22c79415b4cd6e3d8ebc4a0fa32604","redirectLinkEnabled":0,"hasAllocated":1,"isWearing":1,"stampPosition":0,"hasStamp":0,"allocationCount":1,"allocatedDate":"2021.12.21","individualDisplayEnabled":0,"individualDisplaySort":0,"categoryType":1100},"crmLevel":4,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":3574996021054734,"repliedAuthor":{"id":3574996021054734,"idStr":"3574996021054734","authorId":3574996021054734,"name":"Teslawonder","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"crmLevel":2,"crmLevelSwitch":0,"individualDisplayBadges":[]},"objectId":352919382,"type":1,"supId":3905189,"prevId":3910543,"content":"At the moment, MooMoo lower fee for US stks, Tiger lower fee for Singapore stks, esp min <u>fees</u>","text":"At the moment, MooMoo lower fee for US stks, Tiger lower fee for Singapore stks, esp min <u>fees</u>","html":"At the moment, MooMoo lower fee for US stks, Tiger lower fee for Singapore stks, esp min <u>fees</u>"},{"id":3910543,"gmtCreate":1617000484827,"gmtModify":1680782141790,"authorId":3574996021054734,"author":{"id":3574996021054734,"idStr":"3574996021054734","authorId":3574996021054734,"name":"Teslawonder","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"crmLevel":2,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":352919382,"type":1,"supId":3905189,"prevId":0,"content":"Any moo moo fans, pls give like and comment on my recent post.","text":"Any moo moo fans, pls give like and comment on my recent post.","html":"Any moo moo fans, pls give like and comment on my recent post."},{"id":3905189,"gmtCreate":1616925574333,"gmtModify":1680782053655,"authorId":3577917165320806,"author":{"id":3577917165320806,"idStr":"3577917165320806","authorId":3577917165320806,"name":"KinKat","avatar":"https://community-static.tradeup.com/news/303a11363633244c53e6b67003899c74","vip":1,"currentWearingBadge":{"badgeId":"a83d7582f45846ffbccbce770ce65d84-1","templateUuid":"a83d7582f45846ffbccbce770ce65d84","name":"Real Trader","description":"Completed a transaction","bigImgUrl":"https://static.tigerbbs.com/2e08a1cc2087a1de93402c2c290fa65b","smallImgUrl":"https://static.tigerbbs.com/4504a6397ce1137932d56e5f4ce27166","grayImgUrl":"https://static.tigerbbs.com/4b22c79415b4cd6e3d8ebc4a0fa32604","redirectLinkEnabled":0,"hasAllocated":1,"isWearing":1,"stampPosition":0,"hasStamp":0,"allocationCount":1,"allocatedDate":"2021.12.21","individualDisplayEnabled":0,"individualDisplaySort":0,"categoryType":1100},"crmLevel":4,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":352919382,"type":1,"supId":0,"prevId":0,"content":"Moo... Moo...  [鬼脸]","text":"Moo... Moo...  [鬼脸]","html":"Moo... Moo...  [鬼脸]"}],"langContent":"EN"},{"id":352934181,"gmtCreate":1616853417343,"gmtModify":1704799607477,"author":{"id":"3568026014768326","authorId":"3568026014768326","name":"兔气扬眉","avatar":"https://community-static.tradeup.com/news/58fe9e54c89b636f385d436c63c3e4f2","vip":1,"crmLevel":3,"crmLevelSwitch":0,"idStr":"3568026014768326","authorIdStr":"3568026014768326"},"htmlText":"Yes","listText":"Yes","text":"Yes","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/352934181","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":352061981,"gmtCreate":1616832946243,"gmtModify":1704799509142,"author":{"id":"3569319160707763","authorId":"3569319160707763","name":"FuJie1010","avatar":"https://static.tigerbbs.com/95099c51f8498b56c3973ded1570fc6b","vip":1,"crmLevel":2,"crmLevelSwitch":0,"idStr":"3569319160707763","authorIdStr":"3569319160707763"},"htmlText":"Good idea","listText":"Good idea","text":"Good idea","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":3,"commentSize":1,"repostSize":0,"link":"https://ttm.financial/post/352061981","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":3901223,"gmtCreate":1616853454496,"gmtModify":1680781993056,"authorId":3568026014768326,"author":{"id":3568026014768326,"idStr":"3568026014768326","authorId":3568026014768326,"name":"兔气扬眉","avatar":"https://community-static.tradeup.com/news/58fe9e54c89b636f385d436c63c3e4f2","vip":1,"crmLevel":3,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":352061981,"type":1,"supId":0,"prevId":0,"content":"?","text":"?","html":"?"}],"langContent":"EN"},{"id":352007404,"gmtCreate":1616824283208,"gmtModify":1704799449940,"author":{"id":"3557629001242050","authorId":"3557629001242050","name":"kksuen","avatar":"https://static.tigerbbs.com/e1eb0ceb998a78cefb82c2f66d2addb1","vip":1,"crmLevel":4,"crmLevelSwitch":0,"idStr":"3557629001242050","authorIdStr":"3557629001242050"},"htmlText":"Comment and like pls thanks","listText":"Comment and like pls thanks","text":"Comment and like pls thanks","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":3,"commentSize":2,"repostSize":0,"link":"https://ttm.financial/post/352007404","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":3906720,"gmtCreate":1616952682340,"gmtModify":1680782080737,"authorId":3576472032670521,"author":{"id":3576472032670521,"idStr":"3576472032670521","authorId":3576472032670521,"name":"EV8","avatar":"https://community-static.tradeup.com/news/49db5086746d5ad4581b298b77a14995","vip":1,"currentWearingBadge":{"badgeId":"972123088c9646f7b6091ae0662215be-1","templateUuid":"972123088c9646f7b6091ae0662215be","name":"Elite Trader","description":"Total number of securities or futures transactions reached 30","bigImgUrl":"https://static.tigerbbs.com/ab0f87127c854ce3191a752d57b46edc","smallImgUrl":"https://static.tigerbbs.com/c9835ce48b8c8743566d344ac7a7ba8c","grayImgUrl":"https://static.tigerbbs.com/76754b53ce7a90019f132c1d2fbc698f","redirectLinkEnabled":0,"hasAllocated":1,"isWearing":1,"stampPosition":0,"hasStamp":0,"allocationCount":1,"allocatedDate":"2021.12.21","exceedPercentage":"60.29%","individualDisplayEnabled":0,"individualDisplaySort":0,"categoryType":1100},"crmLevel":4,"crmLevelSwitch":1,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":352007404,"type":1,"supId":0,"prevId":0,"content":"??","text":"??","html":"??"},{"id":3900552,"gmtCreate":1616838344958,"gmtModify":1680781982623,"authorId":3577325505292125,"author":{"id":3577325505292125,"idStr":"3577325505292125","authorId":3577325505292125,"name":"Tomji","avatar":"https://static.tigerbbs.com/532a3a0ad4f7404cd51e8a18187863b7","vip":1,"crmLevel":2,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":352007404,"type":1,"supId":0,"prevId":0,"content":"Blessings. reply pls","text":"Blessings. reply pls","html":"Blessings. reply pls"}],"langContent":"EN"},{"id":352008451,"gmtCreate":1616823163773,"gmtModify":1704799443470,"author":{"id":"3573568310387546","authorId":"3573568310387546","name":"LowZackM","avatar":"https://static.tigerbbs.com/768e9ec80d5d9568297fe487c4b4c95a","vip":1,"crmLevel":2,"crmLevelSwitch":1,"idStr":"3573568310387546","authorIdStr":"3573568310387546"},"htmlText":"I will buy anything under 140. Once iPad anouncement+ earnings report, it is going high up","listText":"I will buy anything under 140. Once iPad anouncement+ earnings report, it is going high up","text":"I will buy anything under 140. Once iPad anouncement+ earnings report, it is going high up","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":4,"commentSize":3,"repostSize":0,"link":"https://ttm.financial/post/352008451","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":3919459,"gmtCreate":1617086741121,"gmtModify":1680782271871,"authorId":3573568310387546,"author":{"id":3573568310387546,"idStr":"3573568310387546","authorId":3573568310387546,"name":"LowZackM","avatar":"https://static.tigerbbs.com/768e9ec80d5d9568297fe487c4b4c95a","vip":1,"crmLevel":2,"crmLevelSwitch":1,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":352008451,"type":1,"supId":3900556,"prevId":0,"content":"1st week of April","text":"1st week of April","html":"1st week of April"},{"id":3901590,"gmtCreate":1616861510616,"gmtModify":1680781998494,"authorId":3573568310387546,"author":{"id":3573568310387546,"idStr":"3573568310387546","authorId":3573568310387546,"name":"LowZackM","avatar":"https://static.tigerbbs.com/768e9ec80d5d9568297fe487c4b4c95a","vip":1,"crmLevel":2,"crmLevelSwitch":1,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":352008451,"type":1,"supId":3900556,"prevId":0,"content":"APPL <u>APRIL</u>","text":"APPL <u>APRIL</u>","html":"APPL <u>APRIL</u>"},{"id":3900556,"gmtCreate":1616838366387,"gmtModify":1680781982257,"authorId":3577325505292125,"author":{"id":3577325505292125,"idStr":"3577325505292125","authorId":3577325505292125,"name":"Tomji","avatar":"https://static.tigerbbs.com/532a3a0ad4f7404cd51e8a18187863b7","vip":1,"crmLevel":2,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":352008451,"type":1,"supId":0,"prevId":0,"content":"Anyway ide when that is coming out ","text":"Anyway ide when that is coming out ","html":"Anyway ide when that is coming out "}],"langContent":"EN"},{"id":356756490,"gmtCreate":1616819261910,"gmtModify":1704799405626,"author":{"id":"3565225896317833","authorId":"3565225896317833","name":"yngwin111","avatar":"https://static.tigerbbs.com/7b6da8ffb6e7348c5800f5edb3ff9e62","vip":1,"crmLevel":2,"crmLevelSwitch":0,"idStr":"3565225896317833","authorIdStr":"3565225896317833"},"htmlText":"85 I will buy","listText":"85 I will buy","text":"85 I will buy","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":2,"commentSize":1,"repostSize":0,"link":"https://ttm.financial/post/356756490","repostId":1179353023,"repostType":2,"repost":{"id":"1179353023","pubTimestamp":1616673145,"share":"https://ttm.financial/m/news/1179353023?lang=&edition=fundamental","pubTime":"2021-03-25 19:52","market":"us","language":"en","title":"Apple Stock: At What Price Should You Buy?","url":"https://stock-news.laohu8.com/highlight/detail?id=1179353023","media":"seekingalpha","summary":"Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.An idea for how to get exposure to Apple Inc. without paying full price.Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a ga","content":"<p><b>Summary</b></p>\n<ul>\n <li>Once my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.</li>\n <li>However, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.</li>\n <li>An idea for how to get exposure to Apple Inc. without paying full price.</li>\n</ul>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2759ebda380d31d3cb7409646e4e7d5f\" tg-width=\"537\" tg-height=\"322\"><span>Photo by Andrej Kalsin/iStock via Getty Images</span></p>\n<p>In a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&amp;P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.</p>\n<p>First, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting&nbsp;fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.</p>\n<p><b>Apple Stock Price History</b></p>\n<p>Apple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/807cda601ea1bc6be4a57a3b5182548d\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p>Over longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a39d987338524b27749867cfac46f235\" tg-width=\"635\" tg-height=\"435\"><span>Data by YCharts</span></p>\n<p><b>Apple Growth Rate and Valuation</b></p>\n<p>Apple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/5dbfd56479bd134400ea2dc32a079c08\" tg-width=\"640\" tg-height=\"406\"><span>Source: Statista</span></p>\n<p>You can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the&nbsp;new iPhone&nbsp;should sell like hotcakes. It might not be enough, however, to justify the valuation.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0005edbd4f616e1f2557865c40eb4383\" tg-width=\"640\" tg-height=\"346\"><span>Source: Macrotrends</span></p>\n<p>Apple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.</p>\n<p>1. Trump's tax cuts in 2017. These increased corporate net income for S&amp;P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.</p>\n<p>2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between&nbsp;September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.</p>\n<p>With the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.</p>\n<p><b>When to Buy Apple Stock</b></p>\n<p>My quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.</p>\n<p>Given the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.</p>\n<p>If you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (of<i>The Big Short</i>fame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.</p>\n<p>I currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Apple Stock: At What Price Should You Buy?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nApple Stock: At What Price Should You Buy?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-03-25 19:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4415785-apple-stock-what-price-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would ...</p>\n\n<a href=\"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"AAPL":"苹果"},"source_url":"https://seekingalpha.com/article/4415785-apple-stock-what-price-buy","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1179353023","content_text":"Summary\n\nOnce my favorite stock, the current valuation for Apple doesn't make a whole lot of sense to me.\nHowever, Apple is a great business that remains on my radar. I share the price Apple would need to trade down to for me to expect above-average returns from the stock.\nAn idea for how to get exposure to Apple Inc. without paying full price.\n\nPhoto by Andrej Kalsin/iStock via Getty Images\nIn a sign of the times, financial news networks now have minute-by-minute quotes on GameStop (GME) stock, right next to the Dow and S&P 500. This is the part of the \"TikTokization\" of society, as real relationships and long-term thinking are increasingly replaced by smartphone apps that are engineered to trigger reward centers in the human brain, whether on Robinhood, TikTok, or Tinder. Somewhere along the way, the majority of investors stopped looking at fundamentals, swapping deep calculation and due diligence with mantras like \"stocks only go up,\" and \"hold the line.\" When stocks get disconnected from their business fundamentals, wealth typically ends up getting transferred. This clearly affects Apple (AAPL), the most popular stock in America. To this point, I have good news and bad news.\nFirst, the bad news. There are a lot of people who have no idea what they are doing who are being taken advantage of by Wall Street. They're rapid-fire day trading, getting fleeced in SPACs, buying options without knowing what implied volatility is, and loading their retirement accounts with AMC (AMC) and GameStop. The good news is that it's a tremendous advantage to be a long-term economic thinker when so few people are. This can help you make money not only in Apple but in the stock market in general.\nApple Stock Price History\nApple is up big over the last year off of the bear market low but is flat over the last six months. The obsession du-jour is the direction of Treasury yields. For the first time in my career, the Dow and Nasdaq, which are historically highly correlated, move opposite on most days based on how market participants feel about yields and whether the pandemic will last a few more months or not. This is more of the short-term thinking that won't make anyone money in the long run. But over the last year, you can see that Apple's fortunes have mirrored the US economy at large.\nData by YCharts\nOver longer periods of time, Apple's stock price has reflected the actual business, which has been successful. The business results, along with the valuation you pay for Apple will determine your success as an investor in the stock.\nData by YCharts\nApple Growth Rate and Valuation\nApple's net income has increased from $1.3 billion in FY 2005 to over $57 billion in FY 2020. As you can see from the graph below, the iPhone launch in 2007 was a game-changer for Apple. More recently, Apple's growth in net income has slowed, although they're running over $60 billion annually in net income. Net income is quoted after corporate taxes, so remember that Apple is getting the benefit of a roughly 20 percent increase in income from the Trump tax cuts of 2017.\nSource: Statista\nYou can compare Apple's net income against their market cap of around $2 trillion, and you see that Apple trades for over 35x what it made in FY 2020. There's nothing wrong with Apple, it's a great business, but that's generally pretty expensive for a company whose growth is leveling out. Apple has some positives working in its favor, most importantly that they're expected to earn about 30 percent more in FY 2021 than they did in FY 2020. This brings the valuation down to about 28x its expected earnings, which is still pretty high. Additionally, Apple bulls are quick to remind you that growth in Apple's all-important services segment is driving their earnings and that the new iPhone should sell like hotcakes. It might not be enough, however, to justify the valuation.\nSource: Macrotrends\nApple trading for this kind of valuation it trades for is a recent development. For most of the 2010s, Apple traded closer to 10x earnings, reaching ~20x before the tech correction of 2018 took it back down. P/E ratios are based on earnings per share, which grew faster than pre-tax net income for two reasons.\n1. Trump's tax cuts in 2017. These increased corporate net income for S&P 500 companies by around 20 percent, per my calculations. The tax cuts also unlocked money that had been trapped offshore, creating a large one-time earnings boost for corporations. Apple shows a clear benefit in its financial statements from the 2017 tax cuts. This is a one-time deal. I'll be blunt – I'm more likely to date a supermodel than corporate tax rates are to be cut further with the US fiscal situation being what it is.\n2. Tim Cook's buyback program. By my calculations, Apple was able to purchase a little over 36 percent of its shares outstanding between September 2012 and their last quarterly report. This was a huge win for Apple shareholders, as the company was able to buy tons of shares on the cheap. Apple earned $3.31 per share last year. If they hadn't bought back any shares, they only would have earned $2.21 per share. The buyback alone increased Apple's earnings per share by nearly 50 percent! And what gave the buyback oxygen was Apple's low valuation for most of the 2010s, allowing them to use cash flow and low-interest debt to cheaply accumulate shares and drive EPS growth.\nWith the first tailwind being a one-time event and the second being largely ineffective with Apple's high valuation, if you're going to make a lot of money in Apple shares, you're either going to need to see Apple's net income itself grow, or its PE multiple to rise even higher. I think Apple can grow its net income by 4-5 percent annually over the next 10 years. This seems fair since net income has grown less than this since 2018. With the high valuation, the EPS isn't likely to grow much faster even with buybacks. Based on the business results of Apple and the valuation, I think you can expect a roughly 8 percent annual return by investing in Apple stock at current prices. This isn't enough for me to back up the truck on Apple, but since I've done very well in the past with Apple, the stock never really leaves my radar. What I need to buy Apple at is a price that's more agreeable to me.\nWhen to Buy Apple Stock\nMy quick and dirty method for estimating stock returns is to take earnings yield plus normalized earnings growth. Historically analysts would use dividend yield instead of earnings yield, but now buybacks are much more common than they were in the past, so it doesn't bias the model in favor of dividends. For me to be interested in Apple, I'd like to see at least double-digit expected returns, and assuming 5 percent EPS growth, Apple would need to trade for 20x earnings or less (i.e. what it normally trades for historically). This implies a price of roughly $93 based on Apple's earnings estimates for next year. Apple trades for over $122 as of my writing this article, so we have a ways to go. Apple will need to trade sideways for a couple of years or see a 25-30 percent correction to hit where I'd like to start accumulating it.\nGiven the bipolar history of Apple stock, I think that this is likely to happen at some point. After all, the stock didn't trade above $93 until July of 2020. $93 is just where I would start accumulating, by the way, I'd get more interested as the stock gets cheaper, assuming the fundamentals don't change too much.\nIf you don't want to wait for a correction in Apple, I have another idea that I executed in my portfolio. Sometimes companies own large stakes in other companies, and this can present opportunities for patient investors. Michael Burry (ofThe Big Shortfame) recently bought Porsche (OTCPK:POAHY) stock for this reason because they own part of Volkswagen and the sum of the parts is worth more than the whole. After he publicly shared the idea, people started pumping a bunch of money into Porsche stock, which may or may not have corrected the mispricing (you'd have to look at the financials to know for sure). In Apple's case, Berkshire Hathaway (BRK.B) owns a large minority stake in the company. If you pull Berkshire's 13-F, they own ~$117 billion in Apple stock as of the filing, which represents roughly 20 percent of Berkshire's market cap of ~$580 billion. Berkshire is cheaper than Apple and is tied to Apple stock by its ownership stake. I like the optionality of this trade because you get the Apple exposure essentially for free – the stake has little impact on Berkshire's EPS due to Apple's low dividend yield at the moment. If Apple goes down, I'd expect that Berkshire would be able to accumulate more stock which would help in the long run, and if Apple goes up, then it helps raise the floor on the price of Berkshire stock. There's no mechanism to force this unless Berkshire sells, but over the long run, I would expect that the economic link between the companies would be enough to create an advantage for me.\nI currently own Apple through index funds and Berkshire. If Apple and the NASDAQ continue to fall, I'll be interested in buying, but I'm watching and waiting for now.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":3900557,"gmtCreate":1616838383259,"gmtModify":1680781983102,"authorId":3577325505292125,"author":{"id":3577325505292125,"idStr":"3577325505292125","authorId":3577325505292125,"name":"Tomji","avatar":"https://static.tigerbbs.com/532a3a0ad4f7404cd51e8a18187863b7","vip":1,"crmLevel":2,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":356756490,"type":1,"supId":0,"prevId":0,"content":"Do you thinknit will drop to $85","text":"Do you thinknit will drop to $85","html":"Do you thinknit will drop to $85"}],"langContent":"EN"}],"hasMoreComments":true,"newsSizeData":{"likeSize":209,"commentSize":80,"repostSize":0,"favoriteSize":22,"likeStatus":false,"favoriteStatus":false}}