Is Google Inc. (GOOG) Due for an Apple-esque Pullback? Apple Inc. (AAPL)

Balter now has a $700 price target on Google, up from $670. That would represent a pullback of 16% from current prices. That’s not nearly as bad as Apple’s pullback, but then again no one would have expected a 40% decline.

The strategist notes that Google Inc (NASDAQ:GOOG) is now the 10th most expensive stock in the S&P 100, trading at 24.6 times earnings. The search giant has a PEG ratio of 1.2, while Apple’s PEG of 0.55 makes it the 5th cheapest in the S&P 500. Google’s return on assets has been falling by roughly 6.5% annually while Apple’s has been rising by 11.7% annually.

It’s worth noting that Oracle came pretty close to calling Apple’s top. Exactly a month before shares topped out at $705 in September, Oracle downgraded Apple Inc. (NASDAQ:AAPL)to “hold” alongside a $650 price target (shares were $660 at the time). Investor expectations were a little too frothy, the firm reckoned. Three months ago, Balter also unsuccessfully attempted to call a bottom on Apple, upgrading shares to a “strong buy” as shares had reached 10-year low in valuation based on its EV/EBITDA.

Balter thinks that investors buying Google Inc (NASDAQ:GOOG) at current prices are overpaying. Will he be right?

The article Is Google Due for an Apple-esque Pullback? originally appeared on Fool.com.

Fool contributor Evan Niu, CFA, owns shares of Apple. The Motley Fool recommends Apple and Google. The Motley Fool owns shares of Apple and Google.

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