Apple At All-Time High, Nearing Valuation Issue? (AAPL)

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Apple Inc. (NASDAQ: AAPL) keeps hitting new highs, and today is no divergence away from that.  Jefferies & Co.’s Peter Misek reiterated his Buy rating this morning, but in the call the analyst raised estimates and targets.  The new price target jumped about $100 to $699 per share.  Faster iPhone production, the new iPad, and the likely imminent demonstration of an Apple television are all helping the call.

One thing is worth considering here, even if it is Apple we are talking about.  Many analysts have already raised their price targets recently.  With shares up at $562.00, the consensus Thomson Reuters estimate is now up to $584.26.  That puts Apple’s share price with 4% of the entire analyst community’s average price target.  Sure, there are many price targets which are high (including today’s call from Jefferies).  There is also the notion that “They have kept raising their targets before, so they will do it again.”

It is hard to be anything but positive on Apple.  Technically, it is still a cheap stock and you know that its cash balance is already about $100 billion now.  At some point soon, Apple will reach the consensus price target and then analysts have another decision to make… Raise target, or downgrade stock?  Most likely that decision will be just to raise the target price again.  At some point down the road, that might not be the case.