Is Apple Inc. (AAPL) overvalued?
On Equity Rank's model estimate, AAPL trades 43% above its fair value. Apple Inc. (AAPL) last closed at $342.37; the multi-method model fair value is $239.83.
| Price | Model fair value | Price vs model |
|---|---|---|
| $342.37 | $239.83 | 43% above |
What the answer rests on
- 0 of 10 valuation methods put AAPL's value above its price and 10 put it below, so the methods mostly agree.
- To justify today's price, AAPL's free cash flow would need to grow about 15.0% a year for ten years (a reverse discounted cash flow). Over the last three years it actually grew 11.0% a year.
- AAPL trades at 37.0 times its last year's earnings, against a median of 34.2 for 18 profitable Technology companies.
- Over the past year the price sat below the model fair value on 0% of trading days. The gap ranged from 6% above to 44% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind AAPL's fair value · What prices assume · Other companies