The number one complaint I hear most from past and present Apple Inc. (NASDAQ:AAPL) shareholders is the fact that iPhones growth has pretty much come to a stop. This is the main reason why shares are down over 30% from their highs, and the stock is now trading at a PE ratio of just 10.
What most of these investors are failing to realize is that if one was to look at the iPhone 5 and 5S sales figures, this dip in iPhone sales growth for the ‘6s’ and ‘6s Plus’ models should have been expected. Apple’s ‘s’ line of iPhones typically do not have the sales impact that the complete model refreshes do. That complete model refresh, the iPhone 7, is coming by the end of this year and in our opinion will blow out past quarterly iPhone sales records. In fact I am expecting the company to sell as many as 100 million iPhone 7 devices in the Holiday quarter. The pent up demand for a new iPhone will be so great by then, and Apple has expanded their sales channels by such a wide margin since the release of the iPhone 6, that it would be ignorant to ignore the potential here.
If Apple Inc. (NASDAQ:AAPL) is able to have a 100 million iPhone quarter, combined with the possible introduction of a TV service and the continued popularity of their Watch, there is no reason this stock should not be trading at a PE ratio of around 15-18. And given the fact that their earnings will be much higher by then, a share price of $170 – $200 would not surprise me one bit.
The stock closed at $94.99 during the last trading session. It is down 24.43% since July 7, 2015 and is downtrending. It has underperformed the S&P500 by 15.56%.
From a total of 32 analysts covering Apple Inc. (NASDAQ:AAPL) stock, 28 rate it a “Buy”, 0 a “Sell”, and 4 a “Hold”. This means that 88% of the ratings are positive. The highest target price is $200 while the lowest target price is $102. The mean of all analyst targets is $142.97 which is 50.51% above today’s ($94.99) stock price. Apple Inc. was the topic of 105 analyst reports since July 21, 2015 according to the firm StockzIntelligence Inc. Deutsche Bank maintained shares on January 11 with a “Hold” rating. Stifel Nicolaus maintained shares with a”Buy” rating and a $140 target share price in their report from a December 23. Mizuho upgraded AAPL stock in a recent report from January 11 to a “Buy” rating. Barclays Capital maintained the rating on December 14. Barclays Capital has a “Overweight” rating and a $150 price target on shares. Finally, Canaccord Genuity maintained the stock with a “Buy” rating in a report they issued on a January 8.
The institutional sentiment increased to 1.18 in Q2 2015. It’s up 0.22, from 0.96 in 2015Q2. The ratio improved, as 103 funds sold all their Apple Inc. shares they owned while 854 reduced their positions. 102 funds bought stakes while 1032 increased their total positions. Institutions now own 3.20 billion shares which is 1.58% less than the previous share count of 3.25 billion in 2015Q2.
Compton Capital Management Inc Ri holds 45.15% of its total portfolio in Apple Inc., equating to 113,694 shares. Raiff Partners Inc owns 100,000 shares representing 32.27% of their total US portfolio. Moreover, Rfg Advisory Group Llc has 25.06% of their total portfolio invested in the company, equating to 70,558 shares. The New York-based Independent Investors Inc has a total of 23.66% of their portfolio invested in the stock. Dock Street Asset Management Inc, a Connecticut-based fund reported 269,584 shares owned.
Since March 6, 2015, the stock had 0 insider purchases, and 5 sales for a total of $8.58 million in net activity. Maestri Luca sold 2,908 shares worth $325,347. Williams Jeffrey E sold 46,873 shares worth $5.18M. Riccio Daniel J. sold 24,085 shares worth $3.01 million. Ahrendts Angela J sold 44,789 shares worth $5.90 million. The insider Levinson Arthur D sold 70,000 shares worth $9.20M.
Apple Inc. designs, manufactures and markets mobile communication and media devices, personal computers, and portable digital music players, and a variety of related software, services, peripherals, networking solutions, and third-party digital content and applications. The company has a market cap of $526.57 billion. The Company’s services and products include iPhone, iPad, Mac, iPod, Apple TV, a portfolio of consumer and professional software applications, the iOS and OS X operating systems, iCloud, and a variety of accessory, service and support offerings. It has 10.09 P/E ratio. The Firm also delivers digital content and applications through the iTunes Store, App StoreSM, iBookstoreSM, and Mac App Store.