Apple's P/E drops below 20 (again), ex-cash P/E at 16.44

Following earnings growth of 68%, after hours trading of AAPL at $300/share shows a P/E of 19.8. The company added over $5 billion in cash for a total of $51 billion or $52.9/share.

Excluding cash from the price of $300 leads to an enterprise value of $249 and a trailing twelve months earnings of $15.15. The ex-cash P/E is therefore 16.44.

P/E/trailing Growth is 0.29.

My guess is that this is keeping AAPL cheaper than the S&P 500 on both P/E and P/E/G.

  • Yup, Apple is growing earnings faster than its competitors and the market.

    More interesting …..Analyst are having trouble how to discount Apple's forward 12 month value.

    A well differentiated "hip" product (with positive & unique ecosystem effects) deserves special treatment.
    But from the Q&A, analyst still see Apple as a "devices" company.

    Apple is to the consumer what IBM is the fortune 500 corporate IT, "the safe, one stop shopping vendor" for ALL YOUR consumer technology needs: devices, services, content and software.


  • Great quote. Apple is like IBM in a lot of way. Vertical integration is the best way to go and the hardest to compete with.

    • Vertical integration works when the thing you are integrating is complex and dynamic.

      Prior the iPod and iTunes, MP3 players were simple devices.
      Prior to the iPhone, the technology to make cell phones was standardized and readily available to any manufacturer*.

      Apple entered with a new model that goes well beyond the device.
      This new multifaceted business model is (still) misunderstood by many of Apples competitors.
      They rush out shiny gadgets and wonder why consumers show little to no interest.

      * Nokia was paring down its custom chip design operation (2006 – 2008) during the same period Apple was building up their custom chip design capability.


    • Marcos El Malo

      Interestingly, while MS as a whole doesn't get that, their Xbox division seems to understand. I'm not a gamer, but several acquaintances can't say enough good things about Xbox live and how integrative it is. MS upper management is probably missing the boat if they're dismissing their own brand.

      I'm not pro MS, I'm just following the MS story because I think it's an interesting story. They've fallen so far from when they led the market but they could make a comeback if they get out of their own way. There's a lot of talent there that is going to waste.

      Horace: How'd you do with your predictions?

  • DJ K

    Look at Apple's Q1 guidance…….23 billion for the current quarter. Without production shortfalls on the iphone and ipad, I think we can sell 25 million iphone/ipads.

    Even though some were disappointed in ipads sold and gross margin for the quarter, I think we'll see many analysts come out with upgraded estimates. This stock looks cheap, taking a look 6-12 months out.

  • John

    What astonishes me is that we've worked ourselves into such a frenzy that merely selling over 4 million iPads in its second quarter is a letdown.

    Anyone remember the first year sales estimates when the iPad was announced? How many industry analysts predicted Apple would sell over 4 million in all of CY 2010?