that AppleThe stock (NYSE: SBN) stock has corrected slightly from record highs. Measured against the 52-week high of EUR 162.98, equities have now fallen by around 15%. With a share price of around 138 euros, we therefore get a potential discount, which is even higher in US dollars.
Does that make Apple a buy now? Conditional. Let’s look at basic valuation and current growth prospects. Quality is definitely there in the cult company, where Warren Buffett has invested a gigantic billion fortune.
Apple shares: buy it now?
The Apple stock is at least valued cheaper at a stock price of $ 143.76. After all, there has been further earnings growth in recent years. With annual earnings of $ 5.67 per. share, the price-to-earnings ratio would be around 25.4. At least it’s not too expensive. But other key figures also reflect a not exactly favorable valuation. The fact is that it is also a technology stock.
Apple’s earnings per share were $ 21.69, suggesting a price-to-sale multiple of nearly 7. In addition, the management of the cult group from Cupertino pays a quarterly dividend of $ 0.23. This means a yield of less than 1%.
But it is the growth in Apple shares that is causing a marked shift here. I also tend to favor profit as a goal over sales. Especially since the net margin shows how profitable the cult group from Cupertino is. The first quarter of the new fiscal year 2022 also shone with a sales growth of 9% year-on-year. Earnings per share was $ 1.52. Extrapolated for an entire year and at current share prices, this meant a price / earnings ratio of 23.6.
Opportunity for further growth?
The focal point of any investment dissertation is, of course, further growth. That seems to be possible with Apple shares. For me especially right now. After all, the tech group with its strong products and services has a certain pricing power. In times of inflation, this can be a solid investment dissertation to continue to grow.
But services are also an intact growth market. The management of the cult group from Cupertino is also investing in other solutions. Whether it’s digital health, streaming or other value-added services, it’s now primarily about transforming the hardware group more and more into a software and service group.
For a price-earnings ratio of pi times thumb 25 is not an unattractive valuation for me. In any case, Apple shares are a candidate to have achieved a place in a better than nix portfolio.
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Vincent owns none of the aforementioned shares. The Motley Fool owns shares in and recommends Apple and recommends the following options: short March 2023 $ 130 call on Apple and long March 2023 $ 120 call on Apple.