Apple: Still Cheap At $1 Trillion
Despite surging past a $1 trillion market cap, Apple remains cheap trading at roughly 14x FY19 estimates, ex-cash.
Active iPhone device growth continues to provide a boost to service revenues.
Apple remains on pace for a 10% net payout yield.
Due to huge free cash flows in the December quarter, the tech giant will hardly reduce cash balances in the 2H at the $25 billion quarterly capital return pace.
Now that Apple (AAPL) has crossed the $1 trillion market cap threshold, the capital returns need to be reviewed again to derive whether value still exists in the stock. The famous plan for a $100 billion boost to stock buybacks was impressive at much lower values. My investment thesis that the stock wasn't still priced for the EPS boost still stands.
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