Even a long-time Apple naysayer like Henry Blodget is talking about buying the stock
In a 1,300-word Business Insider story in which he rattles off a litany of reasons why Apple’s (AAPL) shares “crashed to a new low” Friday, Henry Blodget refers seven times to the stock price as “cheap,” “cheaper” and “screamingly cheap” and ends by confessing that although he doesn’t buy individual stocks these days, if the dividend were increased to 4%+, he might find Apple “irresistable.”
Here are the relevant numbers:
Look at that last figure: 6.45. The ratio of the price of the company divided by its earnings. This means that Apple could take itself private, buying up all its stock, using just its earnings for the next 6.45 years. That is based on absolutely NO GROWTH at all in earnings. Just keeping them steady with what they had this year.
That is right. Apple could buy up all its shares without having to increase revenue one iota.
The Street values Walmart over 12 and Target even higher. It expects Walmart to generate more revenue per share next year than Apple. Insane.
This has to place Apple as one of the cheapest companies ever, especially one its size. I think Apple should start a real stock buyback program and get itself entirely out of the crazies on Wall Street.