September 11, 2013

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Click HERE to Download a FREE Sample of the ValuEngine View Newsletter VALUATION WATCH: Our models find that overvaluation is at levels typically seen when market pullbacks occur. Overvalued stocks assigned a valuation now make up almost 78% of our universe and 44% of the stocks assigned a valuation are calculated to be overvalued by 20% or more. 15 of 16 sectors are calculated to be overvalued--14 of them by double digits.

Apple Harvest
--Apple Announces New iPhone Models, ValuEngine Still Rates Stock a Hold
Apple Inc. (AAPL) is engaged in designing, manufacturing and marketing mobile communication and media devices, personal computers, and portable digital music players. The Company's products and services include iPhone, iPad, Mac, iPod, Apple TV, a portfolio of consumer and professional software applications, the iOS and Mac OS X operating systems, iCloud, and a range of accessory, service and support offerings. It sells its products worldwide through its online stores, its retail stores, its direct sales force, third-party wholesalers, and resellers. Apple Inc. is headquartered in Cupertino, California. Apple held another one of their product announcement conferences yesterday. Fanboys rejoiced at the news of two new iPhone models, the iPhone 5s and iPhone 5c. As is typical, the new models feature better processors, battery life, and some cosmetic changes. Probably the most notable news from the latest product announcement is that the iPhone 5c is NOT the "cheap iPhone" many tech

analysts predicted. Indeed, the iPhone 5c, which features a machined (not molded) plastic case, is going to be much cheaper to manufacture, but it will not be sold at much of a discount vs the iPhone 5s (@ $100 less). Production will also be faster, allowing the company a better chance of meeting the expected high demand for the device. Thus, Apple will keep margins high on these coveted devices and be better able to strike while the market is hot. Wall St seems rather non-plussed at the news and the stock is currently down almost 5% on the day and several large banks have downgraded the stock. ValuEngine continues its HOLD recommendation on APPLE INC for 2013-09-10. Based on the information we have gathered and our resulting research, we feel that APPLE INC has the probability to ROUGHLY MATCH average market performance for the next year. The company exhibits ATTRACTIVE Company Size but UNATTRACTIVE Momentum. Below is today's data on AAPL:

ValuEngine Forecast
Target Price* Expected Return 0.21% 1.23% 1.64% 2.54% 16.11% 21.39%

1-Month 3-Month 6-Month 1-Year 2-Year 3-Year

495.69 500.72 502.74 507.22 574.31 600.43

Valuation 1-M Forecast Return 12-M Return Sharpe Ratio 5-Y Avg Annual Return Volatility Expected EPS Growth Market Cap (billions) Trailing P/E Ratio Forward P/E Ratio PEG Ratio Price/Sales Market/Book Beta Alpha

9.53% overvalued 0.21% -25.36% 0.63 20.93% 33.29% 7.39% 464.29 12.57 11.7 1.7 2.74 3.95 0.97 -0.5

Valuation Rank 1-M Forecast Return Rank Momentum Rank Sharpe Ratio Rank 5-Y Avg Annual Rtn Rank Volatility Rank EPS Growth Rank Size Rank Trailing P/E Rank Forward P/E Ratio Rank PEG Ratio Rank Price/Sales Rank Market/Book Rank Beta Rank Alpha Rank

61 72 18 95 93 72 31 100 85 77 22 33 29 58 16

Market Overview
Summary of VE Stock Universe
Stocks Undervalued Stocks Overvalued Stocks Undervalued by 20% Stocks Overvalued by 20% 22.32% 77.68% 9.05% 44.23%

Sector Overview
Sector
Aerospace Auto-Tires-Trucks Basic Materials Business Services Computer and Technology Construction Consumer Discretionary Consumer Staples Finance Industrial Products Medical Multi-Sector Conglomerates Oils-Energy Retail-Wholesale Transportation Utilities

Change
1.00% 0.66% -0.09% 0.74% 0.91% 0.46% 0.54% 0.47% 0.55% 0.96% 0.38% 0.99% 0.27% 1.11% 1.05% 0.88%

MTD
3.50% 5.70% 3.31% 3.86% 5.55% 4.04% 3.11% 2.38% 3.05% 4.10% 2.37% 5.17% 3.94% 4.03% 5.83% 2.40%

YTD
30.49% 47.81% 5.19% 24.03% 32.13% 25.88% 32.51% 16.87% 24.96% 29.18% 36.11% 9.30% 23.27% 34.04% 25.51% 11.47%

Valuation
22.75% overvalued 30.66% overvalued 2.01% undervalued 19.53% overvalued 24.93% overvalued 15.50% overvalued 22.06% overvalued 15.92% overvalued 17.31% overvalued 20.69% overvalued 21.29% overvalued 21.12% overvalued 7.58% overvalued 22.25% overvalued 24.02% overvalued 7.36% overvalued

Last 12MReturn
35.26% 46.48% -24.33% 24.22% 24.14% 29.05% 28.71% 17.10% 14.12% 28.33% 23.71% 17.24% 6.02% 32.51% 29.17% 6.73%

P/E Ratio
18.49 20.65 19.62 23.66 30.65 25.24 25.19 23.04 17.25 22.51 25.43 17.58 26.73 23.59 18.75 19.25