Apple Inc. (AAPL) Stock Will Rise Above $135 In 2017

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Apple Valuations Are Off Their Long Term Averages

Apple stock is exiting 2016 at valuations which are in-line or lower than its long-term averages. The stock currently trades at a trailing twelve month (TTM) PE of 14.12 (based on December 28 close price). This is marginally higher than its 5-year average multiple of 13.6 but lower than the 10-year average multiple of 20.5. However, the 1-year forward multiple of lower than 13 is what makes AAPL stock attractive as we enter a year which will see at least 2 clear fundamental drivers.

With the revenue/earnings contribution from the services segment expected to grow, AAPL stock could also benefit from an expansion of its earnings multiple in 2017. Analysts expect the company to report $9.01 in EPS in FY 2017. A 15X forward multiple puts Apple stock target price at $135, implying a further 15.6% upside from the last traded price. And well, this does not account for earnings surprises over the course of FY 2017. With Apple Inc. (NASDAQ:AAPL) having delivered earnings surprises in 3 of the last 4 quarters, earnings beats over the coming quarters could also lift the stock higher than the $135 level.

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The article Apple Inc. (AAPL) Stock Will Rise Above $135 In 2017 originally appeared on amigobulls.com. Watch our analysis video on AAPL

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