Nearing $500, Apple Stock’s PE Now Below 12: Let’s Comparison Shop, Shall We?

The descent of Apple (AAPL) shares continues, as if it were a flimsy momentum stock suddenly discovered to be full of hype, rather than a conservatively priced mega-cap. Maybe it’s the brilliantly funny Samsung ad doing Apple in.

Regardless, the stock could fall below $500, and with a current PE ratio of less than 12, YCharts decided to look at other big-cap companies priced similarly, and see if they seem more attractive than Apple. Yes, we did this stock comparison less than a month ago, when Apple fell to $600, but with all the jabbering going on we thought it’s worth repeating.

Bear in mind Apple’s steep growth in revenue and its generally widening profit margin.

AAPL Revenue TTM Chart

AAPL Revenue TTM data by YCharts

Also trading at just under 12 times trailing net income are Kohl’s (KSS), Medtronic (MDT), Mosaic (MOS), Cisco (CSCO), Deere (DE) and U.S. Bancorp (USB). No steep revenue increases here:

KSS Revenue TTM Chart

KSS Revenue TTM data by YCharts

The only one with a notably widening profit margin is U.S. Bancorp, and of course it’s a bank coming out of the financial crisis, so that’s not a long-term trend.

KSS Profit Margin Quarterly Chart

KSS Profit Margin Quarterly data by YCharts

Yes, Apple’s margin narrowed a tad recently, and competition will likely squeeze it more in years to come. Sellers, though, seem think it should be priced as a no/slow-growth company with middling margins. Or perhaps the entire market is over-priced, and Apple stock is ahead in reflecting that sentiment.

Jeff Bailey is the editor of YCharts, which includes the just-released YCharts Pro Platinum for professional investors.

Read more articles about: Company Analysis  

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