More AAPL Thoughts

Apple said that revenues next quarter would be higher than expected. At $18 billion versus analysts'-predicted sales of $17 billion; this was probably the biggest key in pushing the stock a bit higher today in a terrible tape. The company also reported third-quarter numbers that well exceeded estimates -- but I think this was expected. What wasn't expected was that we could finally see a quarter that was "good enough."

Apple can keep up the momentum; but does have many worthy foes playing catchup due to tremendous iPad results. I expect AAPL to further penetrate the enterprise as iPhones and iPad's take on RIMM in phones and all the other computing incumbents that sell under-utilized desk and laptop computers. I still also expect a touchscreen computing platform with AAPL's Mac lineup, and that should yet again shake up the enterprise channel in the future. However, this space will be very competitive and HPQ has thrown a shot across the bow already.

Bottom line, I still see nothing to change my low to mid $400's target view on AAPL, a target I've had since the stock was probably around the $144 level. At this point I still see the $248 level being the new dream price level for initiating or adding to core positions. That said, AAPL is still a key tool for the machines that can push the whole market down incredibly fast.

Again, it's worth noting that the stock is trading at a ridiculous PEG. Even stripping out the added growth from the favorable accounting change, we are talking one of the preeminent growth companies on the planet - trading with a PEG below 0.50. And, stripping cash, it's still about 0.35 = that's very, very cheap. Again, there is only one reasonable explanation; and I won't even utter it here as the horse is beyond dead and decayed. Point being, we have massive valuation compression, and as that valuation compression unwinds, AAPL and many other names have far more upside than the pundits declare - with seemingly total certainty......

long AAPL