AustinESW

Is Apple More Undervalued Than Other Tech Sector Stocks?

Andy,

I really like your articles. Good insights and data.

If I could make a recommendation to improve this comparison to other tech companies. Instead of focusing on the static price/cash metric - I think it would be more interesting to focus on the dynamic price/expected cash flow metric.

Cash on the balance sheet is a static asset that should be deducted from market cap to get enterprise value, but it is not a metric that investors are willing to pay a multiple for. Just because apple is 4x cash doesn't tell me much. I'm not going to pay apple $4 for every $1 they have on their balance sheet.

However, I am willing to pay a multiple (10x?, 20x?) the $12B in cash they will generate over the next 12 months, because I expect that to continue to grow year over year. Apple's cash flow going forward is so different from other tech companies (and GAAP earnings), that it provides interesting insight.

Anyway, just a suggestion. I appreciate the time you take putting these articles together. Helps me on my appl investing.