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It's very valuable to have a cold input, especially on this fever times.
You're right to try to see it long, because that's the easiest way not to be wrong. Short time playing is very difficult imho, and lot of informed people here missed the train, because of bad timing.
So what's the correct valuation ?
EPS x PER.
Estimated EPS, as shown in yahoo at 0.91 is probably underestimated, because of G3, new ads and Rhapsody's prospects. Some analysts put 1.09, Philip Lee here 1.2+, and this was before the sub 1000 $ announcement, which is very important in terms of market shares and credibility, then in terms of high end sales.
So let's keep with 1.2
We have now a PER of 22.5. (todays' close: 27 $)
This is not much compared to other computer manufacturers, but it is important in absolute. It supposes significant growth in the next years.
Is it likely to happen ? That's difficult to say, but there is room for it. With under 5 % of world sales, there is significant room for improvement. (and let's not forget the market is also expanding)
Rhapsody and sub 1000 $ computer will sure push sales. But I am not convinced that the g3 and its followers (higher clocking, G4 ...) in itself has no potential beyond this year. In other words, Apple could grow with its current offer/paradigm.
On the bonus sides, there are lots of things that could come from Apple technological advance in multimedia. The AMP is one example. The partnership with sony on DV video is another one.
So my guess is that 27 $ is not a very risky price, and that there are chances of speculation above 30 $.
To go beyond, we would need hard facts: growth + sustained margin
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