Apple Inc (AAPL) and Jim Cramer’s Other Tech Picks

Apple Inc (NASDAQ:AAPL) is many investors’ favorite stock. Jim Cramer has been a long time Apple Inc (NASDAQ:AAPL) fan. Former hedge fund manager and television host Jim Cramer operates a charitable trust which tends to invest in a diversified portfolio of stocks. The portfolio includes growth, value, and income stocks across a range of sectors. We have gone through the most recent disclosed positions and here are Jim Cramer’s five favorite technology stocks:

Jim Cramer

The trust owned 3,200 shares of Lam Research Corporation (NASDAQ:LRCX), a $6.5 billion market cap manufacturer of equipment that is used in turn to manufacture semiconductors. Its most recent quarter, which ended in September, was decent news: while earnings were down 96% from the same period a year earlier, this actually beat estimates and caused the stock to rally from its decline in 2012. It is now down 3% year to date. Lam, which had also delivered strong revenue growth, trades at 10 times forward earnings estimates as Wall Street analysts expect considerably better numbers next year. Billionaire Leon Cooperman’s Omega Advisors liked the stock last quarter, increasing its position to 1.2 million shares. We would like to see better numbers from the company to convince us it can hit the trajectory set by analysts.

Apple Inc. (NASDAQ:AAPL) was the most popular stock among hedge funds in the second quarter of 2012 according to our database of 13F filings (see the full rankings) and Cramer is a fan of it as well as his trust owned 175 shares. Apple Inc (NASDAQ:AAPL) is encountering increased competition from a relentless Amazon, a desperate Microsoft, and an ambitious Google but still has a strong brand name and market position. It also trades at a trailing P/E of 15, which seems rather low given all the other favorable characteristics of the stock. Analyst consensus implies a forward P/E of 12 and a five-year PEG ratio of 0.6. Even if its growth slows Apple (NASDAQ:AAPL) should still be a good value at current prices.

Cramer’s trust disclosed a position of 3,900 shares of EMC Corporation (NYSE:EMC). EMC is a data storage and information software company with a market capitalization of just over $50 billion. Its trailing P/E is 21, but sell-side analysts expect the company to grow its earnings in the next several quarters and their estimates for 2013 imply a forward P/E of 13. Its earnings were up 19% in the second quarter compared to the second quarter of 2011, based on revenue growth and higher margins. We’re a bit wary of the degree to which EMC is depending on growth over the next few quarters to justify its valuation, but we wouldn’t consider it overpriced either.

Broadcom Corporation (NASDAQ:BRCM) was another of the trust’s holdings in the tech sector, with a position of 2,700 shares. Broadcom provides semiconductor products which enable video and voice communications as well as general data transfer. Its business has been struggling recently, with net income lower in the second quarter than in Q2 2011 despite a better top-line, but analysts expect higher earnings in 2013 and so Broadcom carries a forward P/E of only 11 and a five-year PEG ratio of 0.8. We’re cautious of such rosy estimates, and think that other stocks on this list are better values .

Another of Cramer’s top tech stock picks was eBay Inc (NASDAQ:EBAY) as his trust owned 1,800 shares of the auction site and owner of Paypal. These businesses have been driving eBay’s financials higher, as in the third quarter the company saw double-digit growth rates of both revenue and net income compared to the same period in 2011. eBay trades at 17 times trailing earnings; it’s not quite as attractive as Apple, but we think it should continue to deliver good earnings growth and is therefore a good value play. Read our most recent analysis of eBay.

Disclosure: No positions in Apple Inc (NASDAQ:AAPL) or any other stocks mentioned in this article.

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

6 Movies That You Should Watch to Better Understand The Cold War

Top 15 Best Paying Jobs for Women in 2014

Top 6 Things Rich People Do Differently Every Day

5 Retirement Mistakes To Avoid (and Einstein’s Famous Quote)

11 Smartest People in the World

6 Films About the Financial World You Need To Watch (While “The Wolf” is Not Around)

Warren Buffett and Billionaires Are Crazy About These 7 Stocks

The Top 10 States With Fastest Internet Speeds

10 Best Places to Visit in USA in August

Top 10 Cities to Visit Before You Die

Top 10 Genetically Modified Food In the US

15 Highest Grossing Movies Opening Weekend

5 Best Poker Books For Beginners

10 Strategies Hedge Funds Use to Make Huge Returns

Top 10 Fast Food Franchises to Buy

10 Best Places to Visit in Canada

Best Summer Jobs for Teachers

10 Youngest Hedge Fund Billionaires

Top 10 One Hit Wonders of the 90s

Fastest Growing Cities In America

Top 10 U.S. Cities for Freelancers

Top 9 Most Popular Free iPhone Apps

Top 10 Least Expensive Private Business Schools in the US

Top 15 Most Expensive Countries in the World – 2014

Top 6 Tax Scams and How to Protect Yourself

Top Businesses to Invest In

Top 5 Things You Might Be Doing Wrong With Your Business

Top 5 Strategic Technology Trends in 2014

Top Rags to Riches Stories

Parenting Behavior That Promotes Future Leaders

Top 5 Mistakes Made by Small Businesses

Top 5 Most Common and Potentially Devastating Financial Blunders

Top 5 Highest Paying Jobs for Web Designers

Top 6 Most Respected Professions that Also Pay Well

Top 5 Pitfalls Investors Should Avoid

Top 6 Lawyers and Policy Makers Under 30

Top 6 New Year’s Resolutions for Entrepreneurs

Top 7 Locations to Check in on Facebook

Top 5 Mistakes made by Rookie eBay Sellers

Top 7 eBook Publishers in 2013

Top 6 Health Industry Trends in 2014

5 Lessons for Entrepreneurs from Seth Godin

Top 5 Success Tips from Jordan Belfort – the Wolf of Wall Street

Best Master’s in Finance Degree Programs

Top 6 Earning Celebrities Over 50

The most expensive sports to play

Top 7 Earning Celebrities Under 25

Best 7 Online Courses to Take: Free Finance MOOCs

Top 6 Bad Habits that Promote Failure

20 Most Valuable Soccer Teams in the World in 2013

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!