Apple Stock Looks Cheap Here Based on Strong FCF - Shorting OTM Put Options Has Worked

Core Viewpoint - Apple, Inc. (AAPL) stock has shown resilience amidst a tech sell-off, with potential for a 17% increase based on strong free cash flow (FCF) and margins [1][3] Financial Performance - AAPL stock price is currently $277.90, reflecting a slight increase of 2.785% from $270.37 a month ago [1] - The FCF margin for Q4 was 25.85% of sales, with a full fiscal year margin of 23.74%, averaging nearly 25% [4] - Analysts project revenue of $452.93 billion for fiscal 2026 and $481.18 billion for the following year, leading to a next 12 months (NTM) revenue forecast of $460 billion [4] Free Cash Flow Analysis - Applying a 25% FCF margin to the NTM revenue forecast indicates potential FCF generation of $115 billion [5] - The current market cap of Apple is $4.144 trillion, resulting in a trailing 12-month (TTM) FCF yield of 2.383% [6] Market Valuation - The expected market value could rise by 16.5% from the current $4,144 billion, with stock buybacks potentially contributing an additional 0.5% increase, leading to an overall expected gain of 17% [7]