What's it Worth? 56
Glen is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Hi, my name is Glen Bradford and I am going company by company in the S&P500 and telling you what I think they are worth.
341. Intuit Inc. (NASDAQ: INTU) does a lot of small to medium-sized business software. I use QuickBooks. Their business is seasonal with a weak Q1. They've been growing revenues faster than earnings the last five years but there is predictable growth nonetheless. You pay for it too at a P/E multiple of 28. They recently started kicking off a dividend that amounts to 1%, which is a lot for a company at this multiple. Looks too expensive to me. Target: $45-$55. Right now you're looking at over 20x 2012 operating earnings and that's the most I'd be willing to pay for Intuit, which by the way, is destroying H&R Block.
342. Hewlett-Packard (NYSE: HPQ) is looking really cheap. It's a dog of the Dow by some metrics. That's where you want to be if you ask me. I think Hewlett-Packard put in a solid bottom at below $25. Target: $30-$35. They faced some challenges in 2011 that they don't expect will continue into 2012. I'm betting caps points on this one. Outperform. I think that a few years from now you might regret not throwing a growth multiple on HP's earnings at present. Don't believe me? Wait and see.
343. Intel Corp (NASDAQ: INTC) is the place to be as mobile computing continues to take control over as the world's leading medium for business. Even though they are trading at recent highs, I think that they are cheap on a forward basis if you look out five years. I know, looking that far into the future is nearly impossible for analysts. Who cares about them? If the stock price goes higher, they'll raise their price targets to reflect the higher price anyway. Target: $28-$34. Outperform in CAPS too.
344. IBM (NYSE: IBM) is one of my wild cards that I think is wildly overvalued because they have yet to get their hand burned from touching the stove that is burning everyone in the whole mortgage default debacle. I covered it here. I think that as the largest component of the Dow Jones, its price is being unreasonably boosted. If you completely ignore IBM Lender Business Processing Services, they are worth more, but a company is the sum of its parts, unfortunately for IBM. Target: $150-$160.
345. Google (NASDAQ: GOOG) is one of my favorite growth stories. Their Google+ platform is growing faster than Facebook did in its early days but this is no surprise. Their Android software is in my opinion the best. Want to be a developer? Start here. The stock got rocked when they "missed" their target down to below $600. What a load of laughs. Google is worth $650-$750, if not more. A P/E of 20 for this growth story is bottom barrel. Google was recently trading at around $500, which is equivalently their market crash P/E valuation of 2009. This is the one company that I've advised for investors who are looking to own a stable, growing, core portfolio position in a company that is relatively undervalued that is best in breed.
That's it for now, send me your picks if you want me to price them on top of the S&P500: globalspeculation at gmail.com.
Motley Fool newsletter services recommend Google and Intel. The Motley Fool owns shares of Google, International Business Machines and Intel. bradford86 has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.