r/AAPL

I'm 29 years old and make about 55k per year as a contractor for a technology company. Before that, I worked in Apple Retail for 5 years. Even though at the time I was living a little bit paycheck-to-paycheck, Apple's Employee Stock Purchase Plan was too tempting not to participate in, and for the full 5 years I worked there I did the maximum contribution of 10%. (Basically every 6 month period they took the price of the stock at the beginning and end of the period, and sold you the stock at 15% off the lower of the two, up to 10% of your paycheck. Often it was as much as a 25% discount.) I'm now in a better paying job, but saving a bit less in a traditional savings account.

I am debt personally debt free but my wife has a fairly large Medical School debt. Ordinarily I would put this asset toward paying off that debt, but her plan is to take advantage of a government program wherein that debt is forgiven after 10 years of work for non-profit hospitals (which isn't difficult in her field.) Her plan here seems sound and she's already several years into it. She insists I not apply my assets toward her med school debt.

The Apple stock has been doing extremely well and I am personally of the opinion that (small ups and downs aside) it will continue to be strong for at least several more years. My current plan is to hang on to it as-is for three to five more years until we're ready to buy a house, then sell it and put that money toward a down payment on a house. Is that a sound plan, or should I be thinking more long term?

Apple reports on Nov 2 (confirmed on its investor site), so here's what the current price implies, before the headlines.

**The price:** ~$337, about $4.9T market cap. Free-cash-flow yield is roughly 2.8%.

**What our model assumes:** a very strong FY2026 (+14.6% revenue), then growth easing to 7%, 5.5%, 5% and 4.5%, with operating margins around 31%. Discounted at a 10.6% cost of capital (10-year Treasury at 5.24% plus Apple's equity risk), the cash flows come out well below today's price.

**So what's the market assuming instead?** One of two things, roughly:

1. Cash flows grow ~7.5% a year *forever*, not fading to GDP-like growth, or
2. Investors are willing to own Apple for barely more than the Treasury yield, treating it almost like a bond.

Run it as a reverse DCF on revenue growth alone and the answer is "more than 25% a year", which really just means growth alone can't explain this price. The disagreement isn't about last quarter. It's about the discount rate and how long Apple keeps growing.

**What to watch on Nov 2:** whether services growth and margins hold up (that's the durability case), and guidance for FY2027. A beat on iPhone units matters less than signs the growth lasts.

Every input and its source (10-K lines, FRED rate series) is here: https://tickerworth.com/stocks/AAPL/intrinsic-value?utm_source=reddit&utm_medium=sub&utm_campaign=seed_aapl

What discount rate would you use for Apple? Genuinely curious where people land.

*Not investment advice. We explain what a price implies; the decision is yours.*

should i invest in apple now because of the new phone coming out