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Technology Stocks : Apple Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Keith Howells who wrote (8950)	3/1/1998 6:00:00 PM
From: Alomex	Read Replies (1) \| Respond to of 213173

Apple is not a core holding of mine now nor is it likely to be in the near future. As a matter of fact I hold a great deal more stock in PC makers than I do Apple. I'm glad to hear that. I think Apple might well be a good side bet for a well balanced portfolio. Apple could wind up being a dog. It bears a close watch with appropriate stops set. BUT this is the first time in quite a while that I have seen their collective act appear that it may be coming together this much. I agree with you that the upside for Apple is larger than for Dell or Compaq, and that $30 is well within the realm of the possible. I'm just concerned about the strength of this runup. Let see, profits last quarter of $50 mill. Next quarter, optimistically we'll have $10 mill (a tremendous improvement over losses of $186 the year previous). The quarter after that, $65 mill (another stellar improvement over -$50 mill the year before), then they close with a strong fourth quarter with $80 mill in profits, 60% above the "earnings surprise" of the year before. Give it a generous P/E of 20 and you get just about $30 per share. The scenario above is generally optimistic but not a pipe dream. I would like to see two things before acting on it (a) evidence that the stock has sustained stength and (b) next quarter results, to get an idea how deep the cuts really are....