Analyst Predicts Trillion Dollar Valuation for Apple
White's recommendation comes at a time when some are wondering if $500 billion is a market threshold above which Apple will have a hard time moving past, similar to how other $500 billion companies in the past seemed to get stuck.
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"These companies included Cisco Systems (CSCO-$17.10: Buy), Exxon-Mobile (XOM-$83.22: NR), General Electric (GE-$20.00: NR), Intel (INTC-$27.34: NR) and Microsoft (MSFT-$30.02: NR). Most of these companies enjoyed rich P/E ratios (except Exxon) when crossing $500 billion and the tech-related companies had monopoly-like market share positions, neither of which is the case for Apple," White explains, according to Barron's. "With Apple trading at just 8.4x our CY13 EPS estimate (ex-cash; or 10.4x straight P/E), the stock’s valuation is a fraction of the average P/E of over 80x for the three tech companies that crossed the $500 billion level and the over 60x average for all five companies."
Straight to the point, White believes Apple is on pace to become "the most profitable company ever," setting a price target of $1,111 per share, about twice what the Cupertino company's stock is trading for today.