AAPL -- Apple Is Overvalued

I'd love to own Apple stock. Actually, I do own Apple stock, I'd just like to own a lot more. But even though I type this post on a Macbook that I treat like the second child I never had, I can't buy Apple stock.

What is AAPL stock worth? Apple's TTM earnings is $94.6B. Its five year growth rate is 15.6%. Its ten year growth rate is 13.8%. Apple has 16.41B outstanding shares. So we'd like to see a P/E range of 13.8 to 15.6. That's a price range of $79.60 to $89.9, but the stock is trading at $177.57.

Bullish case: Apple is on top of the world. The M1 chip is fabulous. AR is coming. A car is coming. Despite being huge, growth is actually going to speed up! Apple is going to go from $97.6B to $292B in net income in next few years because of these developments.

Bearish case: For Apple to get to $292B in net income a year in four years, they have to grow at 32% per year. If they grow at their five year average of 15%, it'll be eight years before Apple makes $292B. The bulls aren't crazy, but just eighteen months ago Apple's five year growth rate was.... 0.08%.

My strategy: I'm not selling the shares of Apple I already have. I regret selling shares in the past and don't want to make that mistake again. However, I'm not buying more at this price. If the stock was $100, then I might overlook the premium, expect better growth in the future and buy a lot of Apple stock. Until then, I'll wait and see what happens. Maybe the stock gets cheaper and the margins get higher.