Shares of Apple this week have been on an absolute tear. Over the past few days, Apple's share price has steadily increased, reaching new all-time closing and intraday highs day after day. At the close of trading on Thursday, Apple shares were trading at $288.92. Earlier in the day, Apple shares hit $292.76, marking an all-time high intraday stock price, and for a short while, Apple briefly surpassed PetroChina Co. as the second largest company in the world in terms of market cap, with Exxon Mobil still taking up the top spot.
With Apple shares inching closer to $300, analysts still think Apple's stock price will soar even higher. Earlier this week, analyst Shaw Wu of Kaufman Bros. raised his stock target for Apple to $274 citing extremely strong iPad demand and continued iPhone 4 momentum. While Wu doesn't have the most glowing track record when it comes to anticipating the ebb and flow of Apple shares, he's not alone in his bullish outlook on Apple. Writing for CNN, Financial blogger Andy Zaky, who consistently has a stronger track record than most corporate analysts when it comes to predicting Apple's financials and share price, opined a few weeks ago that Apple shares may very well reach $400 by the end of 2011.
Throwing his hat into the ring, analyst T. Michael Walkley of Canaccord Genuity recently opened up coverage of Apple with a stock target of $356. But who are we kidding - stock targets may make nice investor fodder, but they don't mean all that much at the end of the day. One metric, though, that remains impervious to scrutiny is profitability, and in that regard, Apple is in a league all its own.
The following graphic, courtesy of a research report from Wakley, highlights just how much of a money making machine Apple is in the smartphone sphere. From January to June, the iPhone accounted for 17 million of all the worldwide mobile handsets sold, which comes out to about 2.8%. Profit wise, however, Apple's iPhone during the same period accounted for an astounding 39% of industry profits. The chart below really speaks for itself. When you add in exploding iPad demand, strong Mac sales, and record breaking earnings on what seems like a quarterly basis, Apple at $300 a share almost seems cheap.
Source: Here
