Apple: A Slice of Every Portfolio

Even without Steve Jobs, the earnings outlook is terrific for at least two more years, and the stock looks cheap.

Everybody knows at least one Apple nut -- the true believer who proselytizes PC users about the wonders of a Mac, who has already had four iPhones, and who stalks the local electronics store for clues about the launch of the next iPad. Call it the cult of Apple (symbol AAPL). The investment world has a parallel: fanatically devoted shareholders who are only too happy to let their winnings ride on a stock that traded for as low as $83 in March 2009 and has more than quadrupled, to $357, in two years. At that price, Apple, based in Cupertino, Cal., is worth $329 billion, making it the world's second-most-valuable company, behind ExxonMobil (all share prices and related data are as of February 11).

If you possess an iota of contrarian instinct, the unanimity of bullish sentiment has to be unnerving. Just about every brokerage analyst who covers Apple loves the stock -- despite news in January that Steve Jobs, Apple's visionary CEO and founder, has taken medical leave again. "One thing we like about Tim Cook," says Standard & Poor's analyst Clyde Montevirgen, referring to the company's acting chief, "is that he's taken Apple's innovation and turned it into a profitable business model."

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Anne Kates Smith
Executive Editor, Kiplinger's Personal Finance

Anne Kates Smith brings Wall Street to Main Street, with decades of experience covering investments and personal finance for real people trying to navigate fast-changing markets, preserve financial security or plan for the future. She oversees the magazine's investing coverage,  authors Kiplinger’s biannual stock-market outlooks and writes the "Your Mind and Your Money" column, a take on behavioral finance and how investors can get out of their own way. Smith began her journalism career as a writer and columnist for USA Today. Prior to joining Kiplinger, she was a senior editor at U.S. News & World Report and a contributing columnist for TheStreet. Smith is a graduate of St. John's College in Annapolis, Md., the third-oldest college in America.