March 15, 2012
Every week now, it seems like Apple Inc. (AAPL) is breaking another milestone.
Just a few weeks ago, the stock made headlines by breaking through $500. And, a few weeks later, the tech giant’s market capitalization topped $500 billion, making Apple the largest U.S. company on the market. Back in February, analysts were astounded by this; if Apple were a country, it would be the 25th largest economy in the world.
Many thought that Apple couldn’t go any further, that institutions would pull back and take in profits while the going was good.
However, Apple proved that it had plenty of upside left; since February 13, the stock has jumped an additional 20%. Reaching back just to the beginning of 2012, the stock has surged nearly 50%! This morning, the stock crested over $600, sending the markets into a tizzy over its latest move.
But the best part is that Apple still isn’t overvalued. In fact, the stock is trading at just 14 times its expected earnings for the next year. This is inline with the industry average and is actually less than the NASDAQ’s Price/Earnings ratio.
Like I mentioned in last week’s special feature, one reason that investors love Apple to the tune of $500, even $600, is that the company consistently translates its popularity into products. And, when the new iPad launches tomorrow, I fully expect the company to turn a profit on an even greater scale than with its past tablets. Analysts and consumer alike are buzzing about the new iPad and I expect nothing less than a frenzy when it hits the shelves.
So, if you have been following my buy recommendations of AAPL, congratulations! I’ll check in on this stock from time to time, but a great way to keep your own tabs on Apple’s prospects is by checking it regularly through my PortfolioGrader tool.