Hello everyone! To keep this post a reasonable length I will link to my valuation hosted on Adobe's document cloud. Link to full valuation in pdf format here! (If you want to skip the explanation of the inputs the story behind the numbers is located on pages 8-9 and the DCF model is located on page 10). Please take a look at the valuation before bashing or agreeing with my range.
For the past year Apple has been on a massive run with seemingly no sign of stopping. Analysts have been upping their price targets and managers who have missed out on the run are piling in. With Apple recently reporting earnings, there has been renewed debate about what price investors should be paying for stock in Apple. Many say that the company is expensive and point to relative valuation measures such as P/E that are above their long term averages. Others say the company is inexpensive and point to growing revenue segments such as wearables and services.
My preferred method of valuing companies is intrinsic valuation, and what I present here is an intrinsic valuation assessing the value of equity in Apple using a DCF model. I am hoping to start a discussion about what others believe that Apple stock is worth, as well as what assumptions I have made that others agree or disagree with.
I present a base case, bull case, and bear case for Apple and what each of those scenarios would potentially look like. If I was an analyst I would give the stock a buy rating and place the fair value range of Apple stock between $350 and $400. This is NOT a price target and is based on the assumptions which are outlined in the paper.
Please leave any questions, comments, feedback, and discussion down below. I thoroughly enjoy talking about companies, the stock market, economics, etc. Preferably leave comments that are constructive or spark discussion.
Submitted February 10, 2020 at 07:57PM by LoganYoung34 https://ift.tt/3bu2QaD
