By Vikas Shukla
Apple Inc. (NASDAQ:AAPL) stock has rallied more than 44% over the last 12 months. Despite its strong performance, Bernstein Research senior analyst A.M. Sacconaghi believes that the stock remains relatively inexpensive. Its EV/FCF multiple is just 9x, in line with Western Digital Corp (NASDAQ:WDC) and Lexmark International Inc (NYSE:LXK), which are currently facing questions about secular outlook for their businesses.
Apple stock worth $121 a share
Assuming the tech giant’s FCF remains flat for going forward, Bernstein says the stock is still worth $121 per share, or $114 after accounting for Apple Inc.’s cash pile which is largely offshore. However, most investors don’t usually sell Apple based on a specific target price or valuation. They tend to focus more on new product introductions, trajectory of revenue growth and whether future estimates appear realistic.
Considering these three factors, Bernstein analyst Sacconaghi tries to figure out when is the
