The shares of Apple Inc (AAPL) were placed at $635 a share for FY2015. This seems to be good news for the already high performing company. The analysts feel that this will add an extra $4 a share to the earnings in 2015 for the company. This although is about $100 above the current price of Apple’s shares. This price rate is due to a 20% shock to the current stock levels. The forecast was however hypothetical and subject to a lot of factors. Through this article I’d like to highlight those factors which can make this otherwise impossible seeming target quite achievable.
Apple Must Look Beyond The States:
If we remember, the tech giant had, last year, signed contracts with both NTT Docomo and China Mobile and named them its new carriers. NTT Docomo’s more than 60 mm subscribers all over the world got access to Apple’s products around the end of last year. The launch of iPhone 5S has helped the company build a formidable market base in Japan.
China Mobile’s over 750 mm subscribers, on the other hand, have just started to get their hands on the latest iPhones as January 17th was the day when the deal kicked in finally. Both the deals are set to make the company stronger and help Apple gain a fair amount of the Eastern market share. This apart, what I feel is that Apple needs to come out with new products. The innovation seems to have died in the company with Steve Jobs demise. That the iPhones form a considerable amount of the company’s revenue base is a known fact but a little change in the company’s product line would rather do good to the company’s revenue base.
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- AAPL 15-Year Financial Data
- The intrinsic value of AAPL
- Peter Lynch Chart of AAPL
Become More Aware:
A good investor is the one who thinks rationally before making a move. Sentiments should not come in while making decisions. Especially if the decision is related to investments. However, there are many loyalists of a cult product in market. iPhones have been a cult since inception. The top dogs in the company must make use of this weakness. All they’ve got to do is be more aware of a particular situation. This would help the company gain market shares across the globe.
The stocks of the company have increased by more than $140 a share from the lows it had hit in June. The shares for that matter are still cheap. The market conditions are pretty decent. Trading at roughly 16x forward earnings, the market is expected to post S&P 500 of 4% revenue gains this year. Apple sells at under 13x and is expected to have an increase of roughly 6% to 7%. That the company has over $150 billion in net assets and other securities is not accounted for by this record. Going good, the company is expected to continue this run in market for most of 2014. Investments in stocks are expected to fetch decent returns.