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View Michael Allen's Comments
Apple Bears Are Wrong: Here's Why
You are double accounting. There is no reason for AAPL to trade above the EV/ROIC line in your graph unless you expect its ROIC to increase relative to the market. Growth is irrelevant because it is implied in the ROIC. In fact, AAPL's ROIC is most likely unsustainable, and therefore, AAPL should trade below the line, all other things being equal. According to your analysis, AAPL is slightly over-valued. I haven't checked your calculation of ROIC and don't know who you are comparing it to so I have no opinion on the stock. I'm only commenting on the methodology.
May 16, 2012. 01:42 PM
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Apple's Cash Is Not What It Seems
Stripping the cash out reward's companies for hoarding cash. The market rarely rewards companies for hording cash. At any rate, a 50% rise since December in a company this large and well followed seems very difficult to rationalize in any scenario. If the market was that wrong 3 months ago, how can you trust what the market is saying now?
Mar 20, 2012. 04:06 PM
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