I wrote last week that I have moved my price target on Apple Inc. (NASDAQ: AAPL) for the umpteenth time and it now is set for $300 within 12 months. The company has so much momentum in all of its products, and margins are holding up and in fact could be expanding.
The December quarter will be announced in late January, and expectations are set for $9.32 billion in revenues and earnings per share of $1.52. I believe Apple will exceed these expectations -- again -- and of course forward numbers will be raised once again.
Besides the iPod, the iPhone, and the new Mac with the new Leopard operating system, the other variable in the story is difficult to quantify. That variable is Apple's retail stores and the feeling a consumer gets while visiting one. I went to one over the weekend and was in the store for over an hour, just observing the customers and the sales staff. Man, it was unreal.
Yes, the malls were busy this weekend before New Year's Day, but the Apple store was busier than most of its neighboring stores. The one I visited in the Ridgedale Mall in Minnetonka, Minnesota. is a small store in comparison to the flagship Minneapolis Great Mall of America store, yet it was comfortable and there was a buzz. The amazing part of the Apple stores is nothing is "on sale." No need for sales, the stuff just sells like hotcakes.
I got a Leopard demonstration from a helpful and friendly salesperson named Thomas. He was incredible. He bought a new Mac a few months ago, was so enamored with its features and benefits that he applied for a job at the Apple store. His part-time job has turned into 40+ hours per week. Thomas is a physical education teacher at a local middle school and works full time at Apple. He gave me a wonderful demo of the Leopard and I could see his enthusiasm building -- he was actually having fun. His explanations were terrific and easy to follow for a non-geek like me.
Yes, I am going to buy one -- I got hooked as well. I also am going to buy the new iPod with the touch screen. So simple to use and navigate.
Salespeople like Thomas don't fake it with a cursory "may I help you?" He really meant it. His passion for the products permeates the customer like me.
Oh yeah, Apple is going to $300 within 12 months. The driving force behind the success of any enterprise is its people. With people like Thomas, Apple has nothing to worry about.
DISCLOSURE: At publication time, Georges Yared owns Apple stock.
Georges Yared is the CIO of Yared Investment Research and the author of Stop Losing Money Today.











Reader Comments (Page 1 of 1)
2-11-2008 @ 3:20PM
G.GECKO said...
it will go down to 95 dollars....
12-31-2007 @ 11:07AM
Sy Cole said...
Whether you are an investor or just playing with the market, Apple Inc. is a exciting stock for investing. I have been in the Apple environment for as long as Apple has been around. I have just recently started to invest in Apple. Sorry to say I did not invest sooner. My stock has improved drastically. Waiting for the "300" mark.
1-14-2008 @ 12:46PM
brad Root said...
apple is ready to kick more tail.
12-31-2007 @ 11:23AM
brad Root said...
apple is ready to kick tail. we bought a Imac on the day after thanksgiving w/lepoard and its awesome.
12-31-2007 @ 11:24AM
brad Root said...
kick tail
12-31-2007 @ 12:48PM
Stan said...
Not only is this analysis great, but I'm thrilled to see you actually buy and use some of the Apple products. It's one thing, for example, to read a list of the iPhone features -- I thought I understood it pretty well. It's quite another thing, however, to actually buy and use it -- NOW I really get it, and see how powerful it actually is.
So many analysts work in a vacuum -- extrapolating from past trends, for example, without really understanding the business. It's great to see a really fine analyst at work.
12-31-2007 @ 4:29PM
nackley , george said...
What is a Leopard?????
12-31-2007 @ 4:30PM
nackley , george said...
What is a Leopard----
12-31-2007 @ 6:43PM
sam said...
leopard is the new Mac operating system. Like windows vista.
Just because aapl makes shopping fun and has cool products that everyone can love doesnt mean the stock will continue to rise. There is more to the performance of the stock than performance of a company. Besides, have you ever owned a mac product that has broken on you? What a pain, their customer service could use a little touching up.
I dont like the stock because it seems too expensive and doesnt even pay a dividend. If its making so much money, why not give back to the investors?
aapl is not doubt an interesting player, but ill take my chances elsewhere. honestly id rather google myself.
12-31-2007 @ 10:39PM
Beltway Greg said...
Ladies and Gentlemen of the Investing Nation,
Despite all of the turmoil 2007 we've made it through, some richer, some poorer, but hopefully all have learned from their missed opportunities and trades. Thankfully this will be the last year of the bush presidency. (if one can call it that.) At least when Johnson spent on Great Society programs he spent on our Great Society.
As I mentioned in previous posts any recommendation by me, Beltway Greg, or any other soothsayer, prognosticator, tout, tipster, pundit, or member of that pornographic show "Fast Money" has the half-life of a single celled animal. Recent examples: Baidu.com's CEO untimely death and Berkshire Hathaway's recent acquisitions which helped end the jounalistic career of the Barron's writer who suggested that Berkshire was overvalued. The most important bit of information about a stock is the last bit of information released. If you've been following along this year you know I've been a bull on Apple. Going forward I'm remain cautiously optimistic on Apple and the economy. I think we're going to have a rough six months ahead of us and then we'll have a much better fall and winter. We'll finish the year at about 14,300 for the dow but in between now and then we'll see those proverbial times that'll try mens' souls. Friends have asked me to recommend stocks for them and I've given them "The three for $300" for 2008.
Definition. The three stocks I believe may have a chance to reach the $300 level this year.
The first, Goldman Sachs, is far and away the class of the investment banking field and Cramer is right on the money when he suggests that people in the rare air through which their G5s move prefer stability. At $216.00 GS is a screaming buy. If it doesn't make $300 this year it will next year. Either way you're with a winner Mr. Gecko. Set it and forget it.
ICE is poised to move to $300 this year. The chart is a thing of beauty and if oil and all of those other lovely commodities continue to go higher this stock is a mortal lock.
And the last, Apple. Help me here friends. What exactly does this company do? It reminds me of that Saturday Night Live skit by Robert Smigel, "What Does Diddy Do," where a bunch of kids try to discern just what it is Sean "Puffy" Combs does. Is he a fashion designer, a rapper, a record producer, or a mogul? What Does Apple do? Is it a software company? A tech company? A music company? A music company? A retailer? If Apple substantially beats this quarter and raises guidance it's Necker Island with Sir Richard again next holiday. We could see $240 in the blink of an eye. George Yared predicted $300; I'm a bit more cautious going forward. I think Apple will top out around $260 this year mostly because of macro factors. Either way we'll see plenty of in-flight turbulance. Get it going up and get it going down. RIMM went from $100 to $118 in the blink of an eye and Apple could go from $200 to $230 in the same time frame. Nevertheless, this is another stock that could make $300 this year.
Remember, if you have to check the prices 27,000 times a day (baby sitting your positions), you've probably over extended yourself.
Happy New Year! Time to buy some stock in Guinness.
Beltway Greg
1-09-2008 @ 7:49PM
Andrew Horowitz said...
George:
It is a wonder that you are allowed to continue to write after the CROX fiasco. How much money have you lost for people? If you are simply RAH RAH boy, then you are doing a great job... Go George Go!
YEESH! Tell me, what are you going to push next? I want to get ready to short it!