Apple (AAPL) offers downside protection while paying a dividend, qualifying it for the Dividend Growth Equity Portfolio at Quantum Capital. The technology giant is valued at an intrinsic $800 a share with conservative inputs, says
Howard B. Aschwald, CFA, Portfolio Manager, Chief Investment Officer and Director of Research at Quantum Capital.
“Sometimes stocks stay undervalued for a longer period of time, so one of the other metrics we look at is economic margin change. So this year’s economic margins, are they higher than last year’s and will next year’s be higher than this year’s?,” Aschwald said.
Aschwald also likes Trimble Navigation (TRMB), which he includes in the Mid Cap Growth portfolio. He says the GPS company automates location for things like farm equipment so they operate automatically without the need for human drivers. He says the company is also expanding beyond cars with its value-added location dependent applications.
“I have an intrinsic value on that of $75 a share [for TRMB]. It’s around $50 right now, so it’s still got a ways to go. Sales growth is still projected very nicely at over 13.5%, so that’s one of the other characteristics we look to. A company must have higher sales and higher profits over a five-year period of time,” Aschwald said.
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