Morningstar have a bull-case fair value estimate of $775
While even this bullish piece fails to take into account some of Apple’s unique strengths such as the Apple retail stores, this may be the most important analysis I’ve ever read about AAPL, since it tears to shreds the main investor concern about the stock.
IMO, by far the major disconnect between my own value of AAPL and that of the market is the market’s suspicion that all consumer electronic companies eventually suffer the fate of Motorola: consumer tastes change, and what looks strong today ends up weak tomorrow. This article addresses this concern in a clearheaded way that could be instrumental in influencing investing decisions. I hope this report spurs considerable discussion as we await earnings numbers that will reinforce Apple’s current strength.
I think it is a very well written piece and fairly objective. It does not go into specific growth metrics but at a high level discusses a few strengths and weaknesses that may play out. Obviously the focus is a lot more on iPhone as it is largest contributor to revenue and profits.
I don’t agree with the notion that after 2015 Apple will grow in the single digits.
It contradicts their earlier assumption that smart phone growth with continue for a decade.
Once Android legal issues are resolved, more phone builders get out due to lack of profit, Apple manages to get more factories build, and iPhones get slightly cheaper, I expect iOS adoption to accelerate in 2015.
WS does understand all this in very simple terms.
This stock is undervalued, but they can make 10x more money on it in the next 20 years as it makes its way to the top with big waves.