Let me start with some growth numbers : 12 months Y/Y EPS growth in Q1 of 2008 , … , 2011 have been 65%, 34%, 68% and 75%

Let us be bearish and consider that Apple cannot grow forever, and assume that those numbers, starting Q1 2012, are going to be 60%, 40%, 30%, 20%, 15%, 10%, 10% then starting 2018, 4 years of 5% growth (half of that of the growth of IBM now, at most one quarter of that of MSFT …) then 2 years flat and then accelerating decline to bankruptcy at the end of 2032

I will also assume the interest rates to grow by 1% from 1% this year up to 6% and then stay there forever.

So ? Assuming those numbers, AAPL is worth $976 today

## Nicu 11:33 pm

onJanuary 21, 2011 2077 days ago Replythe proof is here

let me explain : the value of a stock is net assets + today’s value of all future earnings (we only assume positive earnings for Apple, by 2032 they should pay most of it as a dividend )

I only count the cash as net assets, the rest being questionable; by the growth rates we compute future earnings (last 12 months = $17.91); those are diminished by the compound interest rates; that’s how you obtain today’s value of future earnings

sum the last column; QED

if you want to play with the numbers or want to see up to date, P/E, PEG, P-$/E, P-$EG graphs / tables, they are here

http://mihalache.free.fr/Apple/PEG/

## Nicu 11:34 pm

onJanuary 21, 2011 2077 days ago Replyso, I cannot post an image in a comment ? only in a new post ? … I’l try that way

## caruso2323 8:19 pm

onJanuary 22, 2011 2076 days ago ReplyNicu ,

I like your “intrinsicy” …

I suggest you use 60% for the next 4 quarters, 30% for the subsequent 4 quarters, and 15%

What investors don’t realize is that the upgrade cycle for mobile devices is 1.5 Years and half for iP’s and iPads, 3 Years for consumer mobile devices such as iPT … Which should sustain my suggested growth rates …

## conshmillo 11:43 pm

onJanuary 21, 2011 2077 days ago ReplyA lot of the market action is emotion. So even when numbers and rational thought indicates something, emotion, at least in the short term will win. Couple it with emotion in technically vulnerable spots and you’ll get emotional avalanches. The trick is to remain solvent when things get crazy.

Images are coming, I just didn’t have much time lately.