Apple Inc. (AAPL)  is up 40% so far in 2017 and more than 60% from its mid-2016 lows, after having just made new highs. Though the Nasdaq's gains and iPhone 8 enthusiasm are clearly factors, I think another one is also at work: Markets are revaluing Apple, which previously traded at very cheap multiples, to account for the stability and pricing power its core iPhone franchise is showing, as well as its potential to deliver moderate long-term earnings growth with the help of both the iPhone and complementary businesses.

This revaluing process might not be over, even if a large chunk of it probably is. And together with a solid iPhone 8 debut, it could let Apple continue its run-up in the coming months.

Apple still only trades for 15 times a fiscal 2018 (ends in September 2018) GAAP EPS consensus of $10.74. And that multiple doesn't account for $153 billion in net cash ($261.5 billion in cash minus $108.4 billion in debt). Even if one applied a 20% discount to the $246 billion in cash kept overseas -- for now, a 10% offshore cash tax holiday isn't a given -- Apple trades at just 13 times expected fiscal 2018 EPS after backing out net cash.

That's a much lower multiple than not only what tech firms such as Microsoft Corp. (MSFT)  and Alphabet Inc./Google (GOOGL) trade for, but also what companies such as Starbucks Corp. (SBUX) , Nike Inc. (NKE) , Coca-Cola Co. (KO) and Procter & Gamble Co. (PG) are valued at. These latter companies -- owners of major consumer brands commanding strong loyalty and pricing power, and seeing moderate sales and earnings growth -- arguably represent Apple's peer group more than Microsoft, Google or IBM (IBM) . And Apple continues trading at a discount to that group, albeit less of one than before.

The fact that iPhone pricing has held up so well in recent years, even as carriers in the U.S. and elsewhere have ditched traditional phone subsidies in favor of installment and early-upgrade plans, shows that Apple has a thing or two in common with Nike or Starbucks. On average, analysts expect Apple to see a $653 iPhone average selling price (ASP) in fiscal 2017, up $8 from a year earlier. For fiscal 2018, ASP is forecast to rise to $687 with the help of the iPhone 8, which is expected to carry a higher starting price than the iPhone 7-Plus' $769.

Jim Cramer and the AAP team hold positions in Apple, Alphabet and Starbucks for their Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells AAPL or GOOGL or SBUX? Learn more now.

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