Paul Price

Cramer's Stop Trading! Costco Comes Back (10/7/09)

Not Broke is correct. A few months back Cramer specifically warned against holding COST shares as he said they were not worth the premium multiple.

Now at a much higher absolute price and a higher multiple he says to buy. What a tool!

Platform Plays and Players: Signs of a Shakeout?

Both Apple and Intuit look very reasonably priced today.

Great balance sheets, highly profitable and with sustainable franchises.

Apple Around $50 Might Be a Core Holding

HEARD ON THE STREET JANUARY 17, 2009

Attention, Investors: Apple on Sale
By MARTIN PEERS

The biggest surprise this week was not that Steve Jobs has to go on medical leave. It was that the shares have dropped only 3.5% since the chief executive and architect of Apple's revival disclosed his news.

The reason: Apple stock already had lost the Steve Jobs premium. It already was near a 52-week low due to recessionary worries and speculation about his health. Now, on some measures, Apple is valued below rivals such as Hewlett-Packard and Dell.

Apple CEO Steve Jobs is taking a medical leave of absence until the end of June.

Apple's enterprise value is roughly six times free cash flow from the past 12 months. That compares with H-P on about eight times and Dell on 8.5 times, according to Barclays Capital analyst Ben Reitzes. Apple looks pricier on a price-earnings basis: 15 times trailing 12 months against roughly seven to 10 times for Dell and H-P. But some of Apple's premium disappears when earnings are adjusted for Apple's policy of recognizing iPhone revenue over two years, rather than when the cash comes in the door.

Even assuming the worst -- that Mr. Jobs doesn't return to his post -- the stock should trade above its peers. It has an unbeatable brand name in technology and a diversified product lineup. Even though its products are high-end discretionary purchases, making them vulnerable to a nasty recession, Apple has broadened its range to include lower price points.

Majestic Research, which tracks Apple sales, reported Dec. 22 that holiday season demand, particularly for the iPod and laptops, had been resilient. On Wednesday, Apple's December quarter results will clarify the business picture. Mr. Jobs's future will remain uncertain. But right now, Apple looks like a bargain

Apple Around $50 Might Be a Core Holding

Fair enough.

Would you buy Apple at 11 - 12 times earnings?