tfx re: valuation
My "off-the-duff" (good typo) guess is that Apple will get back to making a dime a quarter from here through the end of next year, give or take, even in the current economy, with room for upside. This is a little more optimistic than Merrill's guess of 32¢ next year, but not unlike Merrill to be conservative.
Project today's stock price forward 6 quarters, and you see $20 / $.40 = a P/E of 50.
That's too rich (independent of the inevitable stock market bandwagon mentality, of course).
Months ago, I said I felt that by the end of this year, I felt comfortable that Apple would be able to maintain a justifiable share price of about $17.50, both because of its massive cash hoard (now $4.5B!), and also because I felt that it would once again be making about a dime per quarter, with the potential for more if it could roll out yet another nifty new consumer device for the holiday season. And I'm sticking by that.
This G5 really is the bees knees for this company.
Nice to see Fred making positive noises for the first time in quite a while, too.
I expect September's stock options re-valuation to provide me with a re-entry point that should be nice and low, though probably not nearly as low as it was when I backed up the truck in the low $13 range early this year. At this point I'm resigned to losing the shares on which I wrote July 17.5 CCs, and pocketing the 35% gain I will have made on them when I get called out.
I still expect a broader market retreat this year, too. Between now and September would be nice, as I'm going to get called out of a lot more than my AAPL tomorrow, and be up to nearly 40% in cash next week. It's sure been a nice ride up this year, though ... my retirement portfolio keeps setting new all-time highs, and I am never one to get out of the way of a nice rising tide that somebody else is doing all the work to engineer.
Buona fortuna
