Finding companies like Apple, Inc. (NASDAQ: AAPL) that always seem to be expensive in a price earning to growth (PEG) basis at a discount is hard to do.
Apple continues to the cream of the crop as far as technology giants go, in my view. This recent COVID-19 pandemic has made what was already a relatively cheap valuation for the iPhone maker that much more appealing, of late.
Fundamentally, Apple’s numbers continue to be solid. Despite concerns around supply drain disruptions, I think the company supply has too many long-term growth drivers which outweigh the near-term catalysts which have taken the company’s share price lower of late.
Coronavirus-related concerns certainly impact both the supply and demand fundamentals of the company’s discretionary space. Apple’s brand recognition and customer loyalty characteristics separate it from the pack in a big way.
These core fundamentals drivers of Apple’s long-term value proposition have allowed the company to achieve a 15% compounded annual growth rate, a truly incredible feat, particularly when once considers Apple shares still trade at around 18-times 2021 earnings.
What this translates to, on a price-earning-to-growth metric (PEG ratio), is a PEG of around 1, an attractive valuation for a company which traditionally trades much higher. With new products on the horizon and a customer base that doesn’t seem to stop spending even if they lose their jobs, now might be the time to pick up shares of Apple on the cheap.
Invest wisely, my friends.