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Why Scott Nations’ NationsShares Set Apple Inc. (AAPL) Stock Price Target @ $155?

Apple Inc. (NASDAQ:AAPL) closed on Tuesday breaking another record, as it became the first US company to break the $700 billion Market Cap valuation. This is a tremendous achievement from Apple Inc. (NASDAQ:AAPL)’s perspective. Many analysts and investors have kept pushing their target price for Apple Inc. (NASDAQ:AAPL) stock up. Scott Nations, CIO and President at NationsShares talked on CNBC about his view on Apple Inc. (NASDAQ:AAPL) stock and reasons behind his price target of $155.

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“[…] Target is $155 based on not only accommodation of free cash flow but also the fact that we now expect even more buybacks. We expect the company to return more money to shareholders and largely that’s going to be a functional effect. The company can essentially borrow money for free by issuing Swiss bonds and they are going to do so to return money to shareholders,” Nations said.

Nations said that the price target set by his firm for Apple Inc. (NASDAQ:AAPL) is $155 and he feels that Apple Inc. (NASDAQ:AAPL) might do a lot of share buybacks and return a lot of cash to shareholders, which might push the stock up. He added that the company can borrow money by issuing Swiss bonds and return money to shareholders.

He said that many might wonder why a company like Apple Inc. (NASDAQ:AAPL) with $175 billion in hand might have to borrow money to return to shareholders. He added that about 85% of their cash is offshore to US and the company had to pay huge sum in tax in order to return money to shareholders. He feels that borrowing money from Switzerland at lower interest makes it easy for Apple Inc. (NASDAQ:AAPL).

He said that with the combination of buybacks and free cash flow Apple Inc. (NASDAQ:AAPL) might reach $155.

Apple Inc. (NASDAQ:AAPL) stock price keeps going up for the last 18 months, and Nations feels that looking at the trend one might hesitate to get into the stock, but he said that the person needs a different trading strategy to get into this stock.

He advised individual investors who are trying to get into this stock saying that instead of looking to get 500 stock and waiting for the stock to dip to get that, the investors can get 100 stocks at the moment and cash in the uptrend.

Disclosure: None

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