Apple (NASDAQ:AAPL), Sued By E-Book Consumers, Posts Minor Dip

Apple (NASDAQ:AAPL), Sued By E-Book Consumers, Posts Minor Dip

Apple Inc. (NASDAQ:AAPL) designs, manufactures and markets personal computers and related personal computing and mobile communication devices. Its stock came under pressure and fell by -0.90% on May-15 when a United States district court judge dismissed petition by several of the nation’s largest book publishers and Apple to dismiss the class-action lawsuit that accuses companies of conspiring to illegally fix the prices of e-books.

The case was filed on August 9, 2011 by purchasers of e-book who complained that they were forced to pay extra millions of dollar more for their purchases because of substantial price increase by e-book publishers and Apple.

Apple Inc, known for introducing patch breaking products like IPod, I-phone and tablets has been consistently registering 50% growth every year , and can easily overtake Exxon’s (NYSE: XOM) as the largest corporation in a couple of years time. The Company is forecasted to report revenues of $ 162 Billion for the year ending Sept-12 and $ 195.09 Billion for the year ending Sept-13. The Company is expected to report EPS of $ 46.98 for year ending Sept-12 and $ 53.89 for year ending Sept-13

Apple’s stock has delivered an annual return of +62.46% and YTD return of +36.59%. Though over the past five years EPS of the Company has increased at an average compounded annual rate of 65 percent, over the same period the stock price has increased only at an average compounded annual rate (total return before the dividend) of 24.8%. Higher growth rate in EPS as compared to stock price has resulted in drop in price/earnings ratio (P/E) from an average of about 29 to less than 14 today. High growth rate in EPS in the recent quarters along with low P/E ratio as compared to the earnings growth makes Apple a good buy for investors.