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Technology Stocks : Apple Inc.
AAPL 278.28+0.1%Dec 12 9:30 AM EST

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To: slacker711 who wrote (169879)5/28/2014 7:06:29 AM
From: Ryan Bartholomew  Read Replies (1) of 213176
 
Let's say a scenario where earnings estimates for 2015 go from $47 today to $55. Does the market give a PE of 15 based on that kind of earnings growth, a significant portion of which would be based on a one-time share gain due to the launch of the large screen iPhone?
I'd be a buyer at $700 if I thought Apple would earn $55/share in 2015 (barring other developments that indicate the burst would be short-lived).
An iWatch is unlikely to have a substantial impact on earnings in the near-term, but it might bring back the aura of innovation around Apple.
Operative word being "aura", as Apple had nothing to do with innovating the concept of the smart watch or wearables in general. They already exist. The best they could do is build a better one than is currently offered (and if they find a practical way to leave your phone behind and use the wearable device instead, I'd count that as a huge improvement), but inventing/innovation isn't likely an applicable term here.
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