Thu, 02 Dec 2004
After Apple's recent run up to almost $70 a share (over 10% since I sold half my shares 10 days ago),
Smith Barney downgrades
AAPL to hold, advises selling, and at the same time, increases their
12-month target to $75.
"Despite the fact that we are raising our target multiple on calendar 2006
operating earnings this morning from 26 times to 29 times, we cannot justify
more than a $75 fair value in 12 months. And while this suggests another 10%
upside from current levels, we can no longer recommend that medium- to
long-term investors place new money into the shares," the brokerage wrote.
The downgrade occured today when the stock opened at 66.13. A 13% increase
within 12 months seems like a good investment. So what should investors do,
Smith Barney? Hold, sell, or buy this undervalued stock?
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