Reply
Mon 13 Jun, 2011 12:33 am
Apple's market valuation, at around $6 billion, was ridiculously low. The stock traded at only eight times expected earnings while such as Compaq and Dell sold at ratios of 30 to 40 times earnings.
I'm not sure about the meaning of "eight times expected earnings".
@PennyChan,
That would mean that the price per share was eight times the amount the company expected to earn in the coming year.
That would mean that investors didn't have high expectations for future earnings, or in the case of Apple they might not have had faith in the company's value if something happened to the company's founder. Steve Jobs has been in poor health for a number of years. This is speculation; you answer is in the first paragraph.
Selected Answer
Stumble It!
Tweet This
Bookmark on Delicious
Share on Facebook
Share on MySpace