It's not news that people are calling a "bubble" on Apple (AAPL). It has been a knee-jerk reaction for a couple of years now. The latest popular argument is a juxtaposition with Google's chart (GOOG), comparing Google's runup in 2007 with Apple's current performance. Here's a more nuanced chart, which includes P/E. (Image from ycharts, click to enlarge.)
From 2004 to 2008, you see the red line, Google's P/E, violently coming down as Google's earnings shot through the roof. This hyperbolic growth was unsustainable and set unrealistic expectations for the coming years.
In 2007 Google buyers overpaid because they felt the P/E had reached a bottom. If, instead of falling further in 2008, the line had leveled out, Google's P/E today would be 50 and we wouldn't be having this conversation. My point is the P/E needed to fall further but investors couldn't see that because the P/E had already fallen so violently since 2005.
Naturally the P/E had to continue correcting in the second part of the chart. It should have spent more time coming down in the first half, but the market gave Google too much credit for accelerating growth.
Contrast this with the green line in the second half of the chart. The green line is Apple's P/E. It's not hyperbolic. Apple is fundamentally a hardware business and it has a more straightforward valuation. It's easy to make a chart to say what you want it to say by quoting it selectively. But the true standard of a price tag in the stock market is P/E. Juxtaposing Google's with Apple's, we see why today's rally is more sustainable than yesterday's.
Since 2009, the market has felt Apple's multiple belonged in the teens. It has grown a bit toward 20 as Microsoft (MSFT) made a fool of itself. The 2005 days of brokers making cold calls to hawk subprime mortgages and GOOG have been replaced in 2012 with a cliche of "sustainability." Don't bet against that cliche.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.