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Apple Inc - Company Valuation Sample

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Apple Inc - Company Valuation Sample
Company Valuation AAPL:US – BUY Price: $266.70 June 28, 2010 Price Target: $336.34

NAMES

Apple Inc
Industry: Computers & Mobile Devices • Exchange: NASDAQ GS

Apple continues to create economic value through innovative product designs and strategic partnerships with component parts suppliers and device manufacturers. The company is enjoying strong revenue growth and high profit margins, leading to a market capitalization of 242.68 billion, making it the highest valued technology company in the world. The positive outlook for Apple reflects multiple value‐creation drivers: • Smartphones with broad internet applications are overtaking the mobile phone market with growing worldwide adoption rates. The new Apple iPhone4 with pioneering Face Time video calling, Retina display, multitasking and HD video recording is one of the hottest products for 2010. • Mobile computing has been redefined with the new Apple iPad. The iPad establishes an electronic publishing, gaming and internet browsing tablet market between smartphones and PC laptop segments that has sparked one of the hottest new technology trends. • Apple Mac computers including MacBook laptops are receiving market leading product reviews and gaining market share. • Strong demand for the iPhone, iPad, Macs and iPods should fuel revenue growth at the Apple iTunes and App Stores. • Apple enjoys strong customer loyalty that should embrace expected future new product offerings and upgrades. Valuation Outlook Likelihood Growth FY12‐14 Growth FY15+ DCF Share Price EBIT EV/EBIT Value Operations (bn) Multiple Share Price Worst 10% ‐ 15% 5% 220 15,590 10.20 158.96 217 Base 50% 5% 5% 336 15,590 13 202.66 265 Best 40% 15% 5% 410 15,590 15 233.84 300

Source: www.apple.com/investor

Image: http://www.apple.com/iphone

Image: http://www.apple.com/ipad
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