Goldman Sachs says Apple is the most undervalued stock it covers

It's a damn joke how much AAPL is undervalued at the moment.

 

I'd like to see the list covering the most overvalued stocks. I have a pretty good guess as to what would be on top of that list.

unhuh.. Not buying it I'm afraid.

Seems to be an abnormally high amount of quasay posative news this morning and today without much meat on any of these stories. I wonder if it has anything to do with the stock hitting a new low yesterday. People wouldn't be trying to make money now would they?

be careful about what GS says. it usually is the exact opposite of what they are doing and thinking.

These are the guys that helped AAPL crash and burn. And then they come out with a statement like that?

They add a new dimension to the term 'slimey analysts'.

^ Add citigroup to that.

Maybe the SEC should look into these "news releases". I don't imagine they would find anything they like.

 

Heaven forbid. It's not like we haven't just come off of two months of hearsay (was that what you meant?) negative news.

 

 

 

I have to agree with your skepticism. Clearly AAPL is undervalued. But I suspect there's worse to come, and I don't trust Goldman for shit. 

That didn't stop me buying on this rally, though I will likely release half of those in the next 5 minutes.

 

And just like that, Apple pops +$11.  Then drops back down.

Nice little profit for some day traders out there somewhere.

 

(Or have they gone extinct because of automated high frequency trading? http://en.wikipedia.org/wiki/High_frequency_trading)

It popped more than $11 today.

 

The low was 420.75, then went to 435.19, for the high of the day.

Translated: Goldman Sachs has a huge position it wants to unload to make a profit from.

My guess on their list of overvalued stocks, it would also be AAPL.

 

Look at the P/E on a company like Amazon or even Google compared to Apple, it's ridiculous. Also it's not like Apple is making less money than before and growth is still positive.

Apple may be their most undervalued stock but it can easily stay undervalued for the next five years if that's the case. What does any of this prove? Apple is what it is. Apple's share price has been disconnected from its fundamentals for a few years. It was those idiots and frauds like Andy Zaky who kept saying everything was going to change for Apple and its shareholders. Things were going to be different in a much better way. And so what happened? Apple is in an even bigger P/E hole than it was before.

Face it. Apple is a poor investment. People just don't seem to learn. They get a head shot that almost knocks them out but the next day they just forget all about what happened the day before and get clocked again. Please just tell them to stay down and avoid future embarrassment. It's not helping Apple shareholders at all. Apple stood back up in the ring today only to be knocked on its ass again tomorrow. Apple is a fighter with a weak punch and even worse defense. It really doesn't even belong in the ring against Samsung. With all that cash Apple could have become a contender but now it's just a lightweight pretender that doesn't even know how to brawl. With Tim Cook as the coach, Apple will just continue to get knocked around the ring and eventually get punch drunk and its career is over.

A stock price is based upon the mood & fears of the investing public, not necessarily a company's fundamentals. Just because Apple's stock price recently reached an arbitrary number ($705.07) doesn't mean that is it's true value.

Edited by jd_in_sb - 3/5/13 at 1:19pm

I saw an article on CNBC this afternoon saying innovation is the key to get investors back into Apple.  I almost spit out my drink reading it.  As if investors know the first thing about the most over used word ever. 

Don't tell me you actually believe this.

You crazy

APPLE IS DOOMED!

 

Come on, someone had to say it.

Not sure about P/E but this post has the highest BS/number-of-characters ratio in the thread. Congratulations!

I'm not sure that there's worse yet to come. Apple is trading at 7 times forward, cash adjusted earnings. They have no debt. One of their biggest problems is what to do with all the cash they're generating. Most of their markets are continuing to grow and they're gaining share (except for the last quarter when they had supply issues) in the stagnant PC market. Their price is less than half the market average in terms of PE. They're far below their peers in terms of price/book and price over EBITDA, as well.

I just don't see how they can continue to slide. Whether you like Goldman Sachs or not, their analysis is correct. By any standard AAPL is extremely low. Warren Buffett just said the same thing.

I really think we've hit bottom. I just hope it recovers fast enough for my April options to pay off.

Except for their Squawk Box group (and a couple of folks in the 9 AM - 11 AM slots -- e.g., Quintanilla), the rest of CNBC's lineup -- esp. the midday and afternoon crowd -- is a rot-your-brain wasteland. Total bunch of maroons.

 

Spongebob is preferable to that crowd.

when a company has as its basic problem it can only manufacture something to sell once every 10 seconds i have real trouble finding fault with that. Apple stated last quarter it is funding the equipment to loan to manufacturers to get that down to one every 5 seconds or so . that aside they make more per quarter than any company in history or the present market grosses in a year ,control 75% of the cell phone profits with only 20% of the market. their biggest critique is they are loosing share to companies that are giving away up to 10 free phones if you buy just one. they are currently paying a dividend as well. and on the verge of a new product that will revolutionize tv and free us from not only remotes in the cushion but paying for cable shows we never watch and being prisoners of the "bundle"
who would not want to buy into that ?
no we like google because it sells our email content to advertisers sells keywords to the highest bidder and gives the guy with the deepest pockets ad space next to our searches to hell with finding the lowest price for an item (guess what the seller you want can't afford to outbid the good guy) and its yearly revenues are one quarters worth of apple profits
apple needs to loose money one quarter lay off some workers and gain the streets respect for cutting losses. it needs to grub for a 2% profit like Alcoa or ford or give away everything to gain "market share"

i just cant stand this world anymore I'm going to eat some soup with a fork ! thats progress .

The only afternoon host I like is Maria Bartiromo.  The rest are just awful.

Goldmund certainly is guilty of its share of misleading the masses, but it is mostly Hedge Funds that have plagued Apple. Nothing has changed in Apple's fundamentals, except they have improved, from when the same folks were pumping the stock up to $700. This is the classic Cramer leak some phoney bad news to the press to profit from.

Buffet is a smart guy. He, however, has said on the record he wouldn't buy Apple or Google because the companies valuations are hard to formulate. Buffet also is friends with Bill Gates and I doubt he'd buy Apple for that reason alone as he said he wouldn't buy Microsoft because of his friendship.

Apple's only issue in my mind as most of its business is depend on hardware sales. I would like to see it get more aggressive in software services. Especially cross platform services. For example, iAd should run across Android and Windows OS. This would put a hurt to Google in an area Google makes a lot of money, and meanwhile would be a great way for Apple to leverage the servie to advertise Apple products to users of other platforms.

I'd also like to see iCloud be platform independent. I also don't like Apple's change from .me to .icloud as an email suffix. .Me is more interesting and easier to write.

That's not what he said. He said he doesn't buy AAPL or MSFT because they're tech stocks and he doesn't understand tech all that well. He only buys into industries that he understands well.

He does, however, understand business valuation and he has made it quite clear that Apple's valuation is greater than the market value - which is why he has suggested that they should be buying their stock. Specifically, he compared it to buying dollar bills at $0.80 each.

Good ol' Halliburton on the list. Overcharging the US government is a great way to make money.

Railroads and Coca Cola are his thing.

IMO It is all about share count. Apple should listen to Buffet and buy back when the price goes down to a certain level. Once they have reduced the number of shares out there, they should double the dividend. Apple will continue to make lots of money for years to come. It is all about supply and demand. Presently there are too many shares out there. Amazon and Google have way less than Apple.
Edited by saturn101 - 3/5/13 at 8:17pm

When will the media learn to ignore recommendations from Goldman?

I wonder what their holding is and whether this is an attempted pump and dump.
Edited by Greg Price - 3/5/13 at 6:38pm

Goldman Sachs is known to pump the prices for mischievous reasons. Remember their $200 oil price call just before oil prices collapsed? Unfortunately, Steve Jobs is not here anymore to drive AAPL up with vision and innovation. Tim Cook just drags the company along afraid to introduce radical changes. When iPhone 5 came out, I just took one look at it, played with it a bit and knew AAPL is doomed. There is something you can just feel by playing with the product, the sense you get from it beats all the insight you can get from spreadsheets, charts, and and analytics. Back in November, my $300 target on AAPL sounded crazy. Four months later it does not seem so crazy anymore. Until I see genuine change at Apple and products that are ahead of the market and not 1 year behind, I will stick with $300 price target.

 

 

With all due respect, I think you have it wrong. Here he is at an investor meeting commenting on Apple and Google stating he doesn't understand these companies valuations. This does not mean he thinks they are bad investments, merely that he doesn't deal with these types of stocks. 

 

Here he is saying he wouldn't ever buy Microsoft because of his friendship with Gates. This is right after he bought a 5 percent stake in IBM.

 

Tim Cook has not been around long enough to judge him so harshly. You act like Apple came out with ground breaking products every month with Jobs around. The truth is Apple's resurgence was slow, but steady under Jobs. Apple has been a thoughtful, and calculating company. It started with the Jobs ditching the clone program and simplifying the product line up. Then came the iMac a couple of years later. Then OSX. The iPad came out years later. A Windows version a year later. ITunes somewhere in the Mix. Then another year or so came the iPad Nano. The iPhone came out long after the iPod, and the iPad years after the iPhone. These products required patience and planing. Jobs killed the tradeshows so Apple didn't have to be tied to some schedule in releasing products. 

 

 

You are also mistaken about the iPhone 5. The iPhone 5 is the by far the best phone ever, and Tim Cook presided over its release. It feels twice as light as the iPhone 4S. Speed is undeniably amazing. Further, it is beautifully crafted like a fine made watch. Unlike Samsung's cheaply made over priced plastic phones, the iPhone is made with metal and glass. The iPod Mini also occurred under Cook's watch. Job's secret was he allowed the creative people like Ive to create the products without management getting in the way. This hasn't changed since Jobs has passed.

 

Apple's stock drop has very little to do with Apple's management. Apple has always been heavily manipulated by Hedge Funds, and the media likes an underdog more then the champ. Nothing has changed with Apple's fundamentals from when Apple was at 700. Apple has exceeded guidance every time. 

Others are hitting 52 weeks high , APPLE is the most ridiculous stock I have ever seen .

Yes.

What they mean is that Apple will go nowhere until the company drops iOS and MacOS X, and implements the full spectrum of MS Windows OS products.

 

Cheers

You judge Tim Cook too softly. Nowadays 6 months is too long. One fundamental miscalculation where the market is heading and the stock plunges. By the end of 2011, it was clear that consumers are starting to gravitate to larger screens. Tim Cook dropped the ball with 4" in October 2012. My point is not that iPhone 5 is bad but that it could have been so much better and easier to use, could have sold millions more and propelled AAPL to $800. I would not go into details for the sake of keeping this post short but by googling:  Apple DNA Principles, and following the top link, you can see the top four mistakes Cook has made so far. The only thing in his defense I can come up with is that perhaps someone else in his place would have done even worse. May be that's why Steve Jobs chose him as the CEO - to minimize damage.

OK. I'm going to be perfectly honest in my assessment of Tim Cook, by starting out and saying that without a doubt, he is the #1 best process and supply manager in the world... possibly ever.

Stepping into the shoes of Steve Jobs... for any known or living person on this planet... is an impossible task. So yes, pulling your other silly statement that SJ chose TC to replace him was to minify the damage, I could agree. However, let's expand on that and ask: "Damage to who and what were the other possible choices?".

• Jony Ives - as much as I love to see this guys passion for what he does, and his lovable English accent, SJ did the next best thing to free this guy from the day-to-day BS of being a CEO: he made him basically untouchable within the company with free reign and a Senior VP.
• Phil Schiller - ah shucks. I like this guy "most of the time"... however, over the last couple of Apple presentations, he has laid on the "marketing speak" far to heavily, and added unneeded special sauce and a cherry to boot. Not necessary. Not "cool". And even if he is a great "rah rah' guy, I don't think he has what it takes to be the CEO. I'll catch some flak here, but I liken him a (VERY!) small bit to Steve Ballmer. Too much rah-rah and not enough "Just Do It... right please!"
• Dan Riccio - who most people have never heard of, and I assume that he likes it this way. BTW: Senior VP Hardware Engineering
• Bob Mansfield - I really like Bob, and it's rather obvious that he is a very important and highly respected figure at Apple HQ, both in mgmt. and within his teams. However, Bob seems to want to do what he considers "fun stuff" for the rest of his career... and I thoroughly respect that decision. He could have been a pretty compelling CEO I think. It's just that he doesn't want to and would rather retire (again) before putting up with day-to-day BS.
• Craig Federighi - very articulate and well educated, seemingly patient, and "good looking" since sometimes that can be an advantage in getting people to listen to you. CEO material? Possibly. Better in the position that he currently is in at Apple? Probably without a doubt, which would lead to the question, how to replace him in that role(?) SJ surely saw this among other things, that swayed his decision away from Craig, most of all though, probably the "irreplaceable card".
• Eddy Cue - I could keep this simple and just say "Ditto Craig Federighi"... save the "good looking" part ☺ But again I would like to stress the replacability of another key figure in Apple's success being almost impossible at this point in time. I would give Eddy a slight advantage to Craig, if only for the fact that he has more passion and emotion in his presentations.

... and in Apple SJ tradition.... there's just "One... More... Thing" (TM) ... or person I should mention...

Scott Forstall - I'm just going to say that I think that we haven't seen the last of "Scotty Boy"... and the next time we see him, I hope that I will cringe at calling him by a child's epitaph. He needs to grow up. Go on a journey. Maybe with a different venture or company. Possible 'walking in the footsteps" so to speak. Because I actually think he has the passion, hard-ball skills, that could make him an aggressive and competent CEO. Those "hard-ball skills" need to be honed a bit... just as the baseball analogy implies. The "Battle with the Bob" should teach him that if he's clever and humble enough to see it.

Scratch: any outside CEO and/or management guru alive.

So. That's my essay on why Tim Cook was and is the best that Apple or the world has to offer us at this point.

My one piece of advice for TC: I would like to see him kick that Southern Charm to the curb once... and really stalk that stage like SJ used to do, building up his confidence to spit out what he is thinking in no uncertain terms... rather than calmly stating his mind.
Edited by ThePixelDoc - 3/6/13 at 2:28am

Just a small addition to my "essay" above:

If there is one guy that I would love to see "jump ship" for Apple, that would be Paul Irish. Not as CEO, but he could free up someone like Eddy Cue. Just a thought

If Goldman Sachs says buy, you should sell.  Because that's how they roll....