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IT HARDWARE & NETWORKING
August 21, 2012
Company Update Apple Inc. (AAPL - $665.15)RATING: Buy
Price Target: $1,111.00The $500B+ Market Cap Fallacy Put to Rest, Next Stop $1 Trillion
Brian J. White, [email protected]
Tel: 212-709-5730
Topeka Trading: 212-709-5750
STOCK DATA
Price $665.15
Price Target $1,111.00
Market Cap ($M) $629,936
52-Week Range $310.50 - $665.15
Shares (mil) 947.1
ADTV (000) 23,494Enterprise Value ($M) $512,715
Free Cash Flow ($M) $48,647.0
Dividend Per Share $10.60
Yield 1.6%
Debt To Capitalization 0%
FINANCIAL DATA
ROE 32.90%
Net Cash/ Share $123.77
Tangible Book Value $112.23
2012E 2013E 2014E
P/E Ratio 15.2x 13.5x 12.1x
REVENUE ($M)
FY September 2012E 2013E 2014E
Q1 46,333.0A 50,152.5E 56,560.2E
Q2 39,186.0A 40,076.5E 44,267.8E
Q3 35,023.0A 42,685.6E 47,048.6E
Q4 34,262.7E 42,583.5E 47,638.9E
FY 154,804.7E 175,498.1E 195,515.6E
EPS
FY September 2012E 2013E 2014E
Q1 13.87A 14.08E 16.25E
Q2 12.30A 11.17E 12.34E
Q3 9.32A 12.00E 13.13E
Q4 8.22E 11.89E 13.17E
FY 43.69E 49.14E 54.88E
EPS: 1. EPS denotes Pro Forma EPS
Summary
In June, analysts and market pundits expressed growing concern that Apple would succumb t
the $500 billion "market cap flu" and the stock would finally roll over. In a note on June 18, w
highlighted why we felt this was a fallacious argument and pointed out that investors shou
think of Apple's market cap in terms of "trillions" and not "billions". Based on our calculation
Apple is now the most valuable company ever, finally surpassing the market value of Microso
at the peak, and removing a key sentiment barrier for the stock.
Footnotes and disclaimers are contained in the second page of this report.
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Stock RatingsBuy - The stock is expected to trade higher on an absolute basis or outperform relativ
to the market or its peer stocks over the next 12 months.
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Ratings Distribution for Topeka Capital Markets as of August 21, 201Count % of to
Buy 32 50.79
Hold 24 38.10
Sell 7 11.11
Source: Topeka Capital Marke
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