Apple now valued at over $100 billion

[AppleInsider]

Apple Inc.'s market capitalization broke the $100 billion barrier for the first time on Wednesday, as shares of the company surged above $116 following a bullish research report from investment bank Morgan Stanley.

That puts the Cupertino-based company's perceived market value at nearly twice that of long-time rival Dell, which was valued at $59.8 billion as of noon eastern time, and approximately a third of that of Microsoft, which has been teetering around $295 billion.

Coincidentally, it will be ten years this October since Dell founder Michael Dell weighed in with his thoughts on how he would fix the then beleaguered Mac maker.

"What would I do? I'd shut it down and give the money back to the shareholders," he told a crowd of several thousand IT executives at the time.

Shares of Apple were helped Wednesday by a research report from Morgan Stanley analyst Katy Huberty, which asserted that the Mac maker's operating leverage remained underappreciated by investors.

In the report, Huberty raised her price target on shares of the company by more than 35 percent, from $110 to $150, but also laid out a "bull case" scenario that could see shares rising as high as $225 over the next twelve months.

Under that best case, the analyst said, U.S.-based Mac market share would need to appreciate to 5 percent in 2007 and 6 percent in 2008, while iPhone would need to see strong global penetration to 24 million units in 2008.

The bull case scenario would also hinge on Apple introducing an ultraportable Mac device by next January that would sell 3 million units within its first year, the analyst said.

Shares of Apple were trading up $2.62 (or 2.29 percent) to $116.97 in afternoon trading on the Nasdaq stock market.

[ View this article at AppleInsider.com ]

[Buck]

Hmm... Already one third of Microsoft. That's a lot!

[melgross]

Up, up, and away!

[TBaggins]

Heh heh heh... for fun, AppleInsider should trot some of the worst of the mass media 'beleaguered Apple' stories from the mid-to-late '90s. They would make for some hilarious reading now.

Its really amazing how many wannabe tech-pundit 'Nostradumbasses' piled on back then, trying to sound smart by making what they thought was the safe prediction of Apple's demise.

I'll bet less than 1% of those people ever came back later and said, "I was wrong." (and sure as hell Dvorak wasn't one of 'em). Ah well.

--

PS- This just in: The few remaining Apple-hating, pro-MS fanboys wept, joined hands, sang 'Kumbaya', and engaged in a group hug today, reminiscing about the 'good old days' of Apple's near-demise.

"We had 'em", says prominent Apple-hater and forum troll Axel Nimrod Jr. "They almost went out of business in the '90s. But then stupid Jobs came back and ruined everything. Stupid iMac. Stupid OS X. Stupid iPod and iPhone. It should be a Dell-Vista-Zune world, and everyone knows it. Who cares if my computer or mp3 player is attractive and easy-to-use? Who cares how good the iPhone is? Microsoft has always been 'good enough' for me, in fact, 'good enough' is what they're all about."

This reporter resisted the urge to bitch-slap Nimrod Jr., but just barely. Back to you Connie.

.

[Neruda]

Well, I was telling people on these boards to buy when the stock was at around $50/share.

I happen to be more bullish than most on the impact that the iPhone will have on the stock price, so $150 is a pretty safe/conservative upper range for the stock.

At what price/share will the stock start being overpriced? Apple needs to continue gaining marketshare, release the true video iPods that everyone has been waiting for, and have better than expected iPhone sales. $150/share is a given, though.

[JeffDM]

Originally Posted by Neruda

At what price/share will the stock start being overpriced? Apple needs to continue gaining marketshare, release the true video iPods that everyone has been waiting for, and have better than expected iPhone sales. $150/share is a given, though.

That's all subjective. I wonder if it's a little steep right now, though it appears the Mac platform might be growing at the fastest rate ever, so it could still be a good value. iPhone expectations are in the price, and it's not out yet. Almost no one has printed a review of the final product. If, hypothetically, someone like Mossberg said don't buy it, then maybe there will be a major drop of the stock, but I really don't expect that. I think Apple gives Mossberg about a week to play with new devices, hopefully he'll tell us whether there are any significant problems.

[ncee]

I bought my shares many years ago, for A LOT less then $50.00 per share

Skip

PS Buy=t I wasn't smart enough to buy 1,000's of shares … for that I will kick myself in the ass. I have a lot, but nowhere near what I'd like to have

[SpamSandwich]

Originally Posted by ncee

I bought my shares many years ago, for A LOT less then $50.00 per share

Skip

PS Buy=t I wasn't smart enough to buy 1,000's of shares … for that I will kick myself in the ass. I have a lot, but nowhere near what I'd like to have

I can sympathize... we'd all be retired now if only we had the foresight.

[ncee]

Originally Posted by SpamSandwich

I can sympathize... we'd all be retired now if only we had the foresight.

Now to figure out who will be the next Apple (stock to buy)

It would seem like, with all of the digital stuff going on, that a memory company would be a safe bet???

Heck, maybe any of the companies tied in with Apple on any of their products …

Skip

[melgross]

Originally Posted by SpamSandwich

I can sympathize... we'd all be retired now if only we had the foresight.

Ah ha!

[SpamSandwich]

Originally Posted by melgross

Ah ha!

Of course, mel has us all beat!

[Booga]

Originally Posted by Buck

Hmm... Already one third of Microsoft. That's a lot!

What's more, according to finance.google.com, if you bought MSFT in January of 2000, you'd be down 50% on your investment, while if you bought AAPL at the same time, you'd be up 350%. If you bought in Jan 2004, it's break-even for MSFT and up 1000% for Apple.

[samurai1999]

Originally Posted by Booga

What's more, according to finance.google.com, if you bought MSFT in January of 2000, you'd be down 50% on your investment, while if you bought AAPL at the same time, you'd be up 350%. If you bought in Jan 2004, it's break-even for MSFT and up 1000% for Apple.

Way to go Apple!
- Greatest comeback in History!


Man, I wish I had the wisdom to buy APPL in 2004!
- I was still in the skeptical camp until I bought my 1st iPod (a mini - 2005)
- it's a cliche - but it converted me

- and with the Intel Macs & iPhone, it doesn't feel like it's a bubble that's about to burst anytime soon!

[g5man]

Folks it is not too late to get in on a very good long term investment.

Apple stock is still very cheap. At the rate that the company is growing, the stock will hit $400 by end of 2010. So if you look back 2.5 years from now you will wonder why you did not buy some shares.

The iPHone will create a halo affect much bigger than the iPod. In three years when the iPhones are about $250 a piece and Apple sells its 20th million iPhone, we will start seeing some serious market share gains for Apple Computers.

[MacGregor]

Originally Posted by SpamSandwich

I can sympathize... we'd all be retired now if only we had the foresight.

Unfortunately for most of us it had nothing to do with foresight - it had to do with having the money to invest in the first place.

Congrats to all who did, but don't waste thread space describing how intelligent you were when intelligence is only half the equation.

[hmurchison]

Well it's time for Apple to buy some companies


1. Buy Microsoft
2. Buy Adobe
3. Buy Autodesk

Take over the WORLD.

[anantksundaram]

Originally Posted by hmurchison

Well it's time for Apple to buy some companies


1. Buy Microsoft
2. Buy Adobe
3. Buy Autodesk

Take over the WORLD.

I am intrigued: What would they do with Autodesk? What might be the synergies?

[melgross]

Originally Posted by Booga

What's more, according to finance.google.com, if you bought MSFT in January of 2000, you'd be down 50% on your investment, while if you bought AAPL at the same time, you'd be up 350%. If you bought in Jan 2004, it's break-even for MSFT and up 1000% for Apple.

I made a lot of money on Apple in the late '90's. Lost almost 20% in 1999, before I sold out that, and my other investments.

I was thinking of buying in again when the price dropped to $3.

Now I'm really sorry I didn't.

I can't complain though, as I did buy in again at $16.93 pre-split.

My investment in Apple from that time went from five figures to its present seven.

[melgross]

Originally Posted by g5man

Folks it is not too late to get in on a very good long term investment.

Apple stock is still very cheap. At the rate that the company is growing, the stock will hit $400 by end of 2010. So if you look back 2.5 years from now you will wonder why you did not buy some shares.

The iPHone will create a halo affect much bigger than the iPod. In three years when the iPhones are about $250 a piece and Apple sells its 20th million iPhone, we will start seeing some serious market share gains for Apple Computers.

The stock isn't cheap. It's worth just about what it should be.

If Apple does make a big success with its new product lines, and continues to increase its present ones at about the same pace, then the company will be worth much more, and the stock price will reflect that.

[melgross]

Originally Posted by MacGregor

Unfortunately for most of us it had nothing to do with foresight - it had to do with having the money to invest in the first place.

Congrats to all who did, but don't waste thread space describing how intelligent you were when intelligence is only half the equation.

You're right. Some of it is luck.

But, it's also the willingness to remain with the stock as it continued to rise, rather than sell out, and take the money, or buy "puts".

[melgross]

And some more interesting news.

http://www.forbes.com/feeds/ap/2007/...partner=alerts

[ajhill]

Now here's a poster with some major juice. Nice call on Apple last year. It's great that you remind us all of your optimism from last year. For all the talk of a bubble upon the realease of the iPhone based on all the hype (and it is just getting started, can you say TV ads?) it just might come out and people may actually like it. Maybe even the PC people will have to admit that Steve Jobs hit a grand slam this time out.

My estimate on Apple was $128 before the iPhone release, but that was based on a PE of 40, which I thought was reasonable given the growth rate.

With rumors floating around about an initial run of iPhones as large as 17 million, I'm starting to think that might be a little low. Who order's 17 million of a product ahead of the release? Certainly not Mr. Softy's Zune.

Originally Posted by Neruda

Well, I was telling people on these boards to buy when the stock was at around $50/share.

I happen to be more bullish than most on the impact that the iPhone will have on the stock price, so $150 is a pretty safe/conservative upper range for the stock.

At what price/share will the stock start being overpriced? Apple needs to continue gaining marketshare, release the true video iPods that everyone has been waiting for, and have better than expected iPhone sales. $150/share is a given, though.

[SpamSandwich]

Originally Posted by melgross

I made a lot of money on Apple in the late '90's. Lost almost 20% in 1999, before I sold out that, and my other investments.

I was thinking of buying in again when the price dropped to $3.

Now I'm really sorry I didn't.

I can't complain though, as I did buy in again at $16.93 pre-split.

My investment in Apple from that time went from five figures to its present seven.

Nicely played, mel.

[SpamSandwich]

Originally Posted by melgross

And some more interesting news.

http://www.forbes.com/feeds/ap/2007/...partner=alerts

Might this further widen the number of AAPL investors with S&P index funds, or what other significance is in this story?

[melgross]

Originally Posted by SpamSandwich

Nicely played, mel.

You know, it's funny, some people here can't believe that someone who actually has made some money would be willing to be on these forums. Weird.

Of course, if I HAD bought at $3, and spent the same amount of money, well, I would just buy this site, and say anything I wanted to, er, not that I don't anyway.

[melgross]

Originally Posted by SpamSandwich

Might this further widen the number of AAPL investors with S&P index funds, or what other significance is in this story?

That's an interesting question. If a company gets on that index, it could mean more funds would invest in it. But Apple is already so institutionally heavy, that I don't know if it would make a difference.

I remember when it was otherwise.

[SpamSandwich]

Originally Posted by melgross

You know, it's funny, some people here can't believe that someone who actually has made some money would be willing to be on these forums. Weird.

Of course, if I HAD bought at $3, and spent the same amount of money, well, I would just buy this site, and say anything I wanted to, er, not that I don't anyway.

It's only natural to want to keep tabs on the stock that has paid off best for you... I've done OK so far (AAPL is my biggest gainer), but the stock gods seem to have smiled widely on you, mel.

[melgross]

Originally Posted by SpamSandwich

It's only natural to want to keep tabs on the stock that has paid off best for you... I've done OK so far (AAPL is my biggest gainer), but the stock gods seem to have smiled widely on you, mel.

I'm a lot older than you. Keep holding it, and they'll be smiling at you too.

[SpamSandwich]

Originally Posted by melgross

I'm a lot older than you. Keep holding it, and they'll be smiling at you too.

Out of curiosity, mel, are you a real estate investor also... and if so, has real estate paid off better than stocks for you? I know of many folks who have made far more solid gains in real estate vs. stock, even in a shaky housing market...

[melgross]

Originally Posted by SpamSandwich

Out of curiosity, mel, are you a real estate investor also... and if so, has real estate paid off better than stocks for you? I know of many folks who have made far more solid gains in real estate vs. stock, even in a shaky housing market...

No, the only real estate is our house we bought 24 years ago.

But, in the housing market here in Forest Hills, which is in Queens, NYC, the houses have always gone up, even during a slump. Recently, I received an offer for five times what we paid back then.

[anantksundaram]

Originally Posted by SpamSandwich

Might this further widen the number of AAPL investors with S&P index funds, or what other significance is in this story?

Bottom line from this literature: There is a significant positive effect, but it is transitory. Perhaps some of the positive AAPL price movements in the past couple of days is attributable to the elevation to S&P100, but the evidence would suggest that, going forward, there is not much to expect from this.

(For those interested, the classic paper on this is: Pruitt, S. W. and K. C. J. Wei, 1989, "Institutional ownership and changes in the S&P 500," Journal of Finance 44, 509–13.)

[melgross]

A postscript to this.

The WSJ today has a small boxed article on page C8 about the change to the S&P 500 Index. It says that MedImmune Inc will be replaced by Precision Castings Corp.

I found that to be interesting.

No mention of Apple.