Why Apple stock is undervalued, and Why I Am A Long Term Buyer
Apple stock has consistently had a price to earnings ratio in the range of 15 to 28 over the last 5 to 10 years. Apple stock is practically unbeatable, and it is the most profitable company in the world by far, with the highest market capitalization, and so in this blog post, I will tell you why Apple stock is undervalued, and why I am a long term buyer of the security.
Even with how much the company has skyrocketed in its stock price, the earnings have justified every single penny of it, and shouldn’t ever move from more of a value stock to a growth stock at its later inception dates, we will see catastrophically massive gains on the stock price. If it price to earnings multiple goes up to something like 80 or 100 over the next 10 to 20 years we could easily see the stock, 25 bagger, even from its current position.
I have watched and watched as my money has sat in CDs and index funds, and as I stayed away from what I consistently thought was an overvalued Apple stock price, only to be laughed at time and time again. I am going to start killing market exposure on Apple stock, because I think they are a company that is a winner, and because of the fact that I am literally writing this blog post on an iPhone right now while being stuck in traffic, and for the fact that I can see dozens of iPhones around me from the passing cars that are driving. Here are some things about Apple stock that are good to know:
They are moving into the car market
They are moving into the banking market
They are revolutionizing the healthcare market
They have just created a payment processing program, through Goldman Sachs, called the Apple credit card, as well as the new credit card scanner on the back of every single person’s iPhone. This is very practical in a brick and mortar account way of doing business, especially considering the hefty paperwork and fee requirements that hit merchant accounts in this day and age. I am sincerely looking forward to how Apple will continue to grow with the company over the next 20 years, and I will be a buyer and holder all the way!
Why Apple Stock Is Undervalued, A Look At The Fundamentals
Looking at the fundamentals:
-Apple currently brings in net revenue of around $400,000,000,000.00 per year. That’s right, $400 billion dollars per year.
-Apple brings home profit, the final, after tax net income number, of around $120 Billion per year
-Price to earnings multiple is 27.37 currently. The company is also aggressively buying back shares of their stock. This tells me two things, that they feel their stock is enough of a bargain to want to buy it back, and that they are making their shares more scarce, which will further drive up the price. When the most profitable company in the world has a financial benefit in buying back more of their shares, get the heck in there.
-My next paycheck is going into Apple, that much I can tell you!
Apple Is The Most Profitable Company In The World! Get In While You Can
The 5 year price forecast of Apple, with a nearly unanimous consensus among financial analysts, has Apple hitting something like a 130 to 135% gain over the next 5 years. Looking at the fundamentals of the company, these numbers honestly look so good that I am strongly considering pulling back from my diversified portfolio position and putting a significant portion of my money into Apple, to the tune of 70 or 80%.
Final Thoughts On Why Apple Stock Is Undervalued, Looking At The Technical And Fundamental Factors
And that’s why I think Apple’s stock is severely undervalued, even with how everything in the market is propped up right now. Apple shares are currently still a bargain, and I give this stock a rating of Buy and Hold over the next 5 years, get in now! For more details and information on all things business and finance, read on or subscribe to our blog for additional details and information.
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