Today we’re going to take a look at the well-established Apple Inc (NASDAQ:AAPL). The company’s stock saw a double-digit share price rise of over 10% in the past couple of months on the NasdaqGS. With many analysts covering the large-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Today I will analyse the most recent data on Apple’s outlook and valuation to see if the opportunity still exists. See our latest analysis for Apple
Is Apple still cheap?The stock seems fairly valued at the moment according to my valuation model. It’s trading around 11.49% above my intrinsic value, which means if you buy Apple today, you’d be paying a relatively reasonable price for it. And if you believe the company’s true value is $164.97, then there isn’t really any room for the share price grow beyond what it’s currently trading. So, is there another chance to buy low in the future? Given that Apple’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us an opportunity to buy later on. This is based on its high beta, which is a good indicator for share price volatility.
Can we expect growth from Apple?Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company’s future expectations. With profit expected to grow by a double-digit 17.84% over the next couple of years, the outlook is positive for Apple. It looks like higher cash flows is on the cards for the stock, which should feed into a higher share valuation.
What this means for you:
Are you a shareholder? AAPL’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?
Are you a potential investor? If you’ve been keeping tabs on AAPL, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook is encouraging for the company, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Apple. You can find everything you need to know about Apple in the latest infographic research report. If you are no longer interested in Apple, you can use our free platform to see my list of over 50 other stocks with a high growth potential.