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Wall St. discounts Apple's growth potential

Apple, with its $50 a share in cash, could earn as much as $17 to $20 a share in 2011, which means the stock is trading at a cheap 12.5 times next year’s earnings. Cramer said even if Apple hits his $300 target, the stock will still be cheap trading at just 15 times earnings.

“That’s less than almost every single growth stock I follow,” Cramer said, “and even less than the S&P 500’s multiple.”

via Jim Cramer Predicts Apple Inc. (NASDAQ:AAPL) will hit $300 a Share | Madd Money.

S&P forecasts the S&P 500 average P/E for 6/30/2010 at 22.57.

Readers of this blog may recall that I noticed Apple’s discounted valuation several times.

  • Tom Ross Ross

    Partly it could still be the effect of subscription accounting.

  • http://www.asymco.com asymco

    Very unlikely in my opinion. My pet theory is that the stock is discounted because of Steve Jobs. His mortality hangs like a pall over everything.