Apple Inc.

Methodology

Apple's transition to high-margin Services revenue creates more predictable earnings than historical hardware cycles, making this calculation increasingly reliable. However, the market typically assigns substantial premiums above calculated fair value reflecting Apple's brand strength, ecosystem lock-in, and massive cash generation. This method works best as a conservative floor valuation rather than a price target.

Methodology

Apple typically trades at premium PEG ratios reflecting the market's willingness to pay for Services growth, capital return consistency, and defensive characteristics during downturns. While traditional value investors seek lower ratios, Apple's recurring revenue transition and pricing power justify elevated multiples. Compare to Apple's historical range rather than absolute thresholds to identify relative value opportunities.

Methodology

Apple's substantial capital returns through both dividends and buybacks make yield-adjusted metrics more relevant than growth-only measures. The company returns massive cash to shareholders annually, significantly enhancing total return beyond earnings growth alone. PEGY better captures Apple's mature tech profile where consistent shareholder returns complement moderate growth.