The Fall of Tech
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What a difference a quarter makes. Apple (AAPL) and Google (GOOG), which together accounted for around 70% of the Nasdaq 100's performance in the third quarter, have both been under pressure in the current one. Apple shares have lost some 10% since peaking at just above $700. Google had its own debacle Thursday when a glitch caused earnings to be released in the middle of the trading day. To add insult to injury, the company missed on the top and the bottom lines. The stock plunged some 60 points for the day.
- Earnings growth is picking up. The company booked $2.60 a share in earnings for fiscal 2011 and is tracking to earn just over $2.90 a share in 2012. Consensus earnings estimates for 2013 are currently projected to be more than $3.30 a share.
- The stock is selling near the bottom of its five-year valuation range, based on its price-to-earnings, price-to-sales, price-to-book and price-to-cash-flow ratios.
- The median price target on Jacobs is $50 a share, per the 14 analysts that cover the company. Standard & Poor's has a "Buy" rating on the stock and recently raised its price target by $4 to $50.
- Revenue growth is projected to accelerate by more than 10% in fiscal 2013 after around a 6% increase in 2012. Jacobs shares sell for less than 13x forward earnings, a discount to their five-year average of 16.5x.
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