AAPL stock could hit $264 - Cramer

Jonny Evans
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September 16, 2009
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Apple could rise to $264 per share on new accountancy standards regulation, said Jim Cramer during his Mad Money report last night. (Video Below)

“I'm raising my price target on Apple," Cramer said, saying his $200 price target on the company no longer applies if a new accounting change goes into affect.

Following strong lobbying on behalf of Apple, the Financial Services Accounting Board is considering applying a change in its rules, a change which would enable Apple to recognise revenue from its iPhone and Apple TV products during the quarter in which they are sold.

At present, Apple is required to recognise the money it raises on these products over a 24-month period.

Cramer said if Apple is allowed to recognize all of its true earnings in the quarter, its earnings per share will rocket from $9 to $12. With this in mind he set a new price target for the company - $264 a share.

The stock-picker also urged investors to move fast, explaining that many bigger money managers haven’t yet considered the implications of the accountancy rule change, creating opportunity for smaller investors.

He expects the new rules to come into effect in the next few weeks.

Comments (8)

9to5Mac Noob (not verified) | September 16, 2009 - 5:32am

Wooooooooo!!!!!!!!

AWx (not verified) | September 16, 2009 - 5:50am

THIS IS JUST AN ACCOUNTING MODIFICATION !!!!

Apple is still the same company with the same people. It sells the exact same amount of Mac, iPods and iPhone. It sits on the same pile of cash.

Apple has published both GAAP (current official accounting method) and non-GAAP (the accounting method it is pushing) numbers at every single quarter since the introduction of the iPhone and the corresponding accounting practice.

So, if the price share changes, this is because of people not being aware of the financial reality of Apple since THIS REALITY WILL NOT CHANGE !!!!
So, because of LAME TRADERS, the stock might raise.

Vaganza (not verified) | September 16, 2009 - 6:28am

Didn't he also say Bear Sterns was fine?

9to5Mac Noob (not verified) | September 16, 2009 - 7:03am

I am worried for Apple, Cramer has been so consistently wrong for so long that this is a clear signal to short the stock. I remember his strong buy recomendations for AT&T, MCI, Lucent as they tumbled in value.

9to5Mac Noob (not verified) | September 16, 2009 - 7:49am

Best reason I've heard yet to SELL!
Cramer is a great predictor of the market. Do the opposite of whatever he says!

Polrbear (not verified) | September 16, 2009 - 9:40am

In canada, we don't have jokers like Cramer and the like. In fact, after the economic meltdown and the Cramer vs Stewart showdown (which I loved), I'm surprised he still has any credibility. Do people really listen to him?

AdamC (not verified) | September 16, 2009 - 5:58pm

This guy had lost too much credibility for many of us but he still has his fan base.

The only thing that can propel Apple share price upward is they keep on doing what they have been doing lately viz. innovative and game changing products.

9to5Mac Noob (not verified) | September 18, 2009 - 5:45am

I agree with most everyone. Almost every stock I bought that this idiot
suggested was a buy, i lost money on.
AAPL cannot sustain these high P/E levels.
Sell short!