The only thing that has come remotely close to challenging Apple's is Google's Android. For a long time, Apple had been fairly lonely in the smartphone space and no one came close to offering a similar look and feel of the iPhone, until the Motorola Droid came out. Using Apple's own words, "it changed everything." In my opinion, the Android platform is not as slick as Apple's iOS, but it does have advantages that are not insignificant. For example, its latest version of the OS is able to support Flash on its browser. You can easily use tethering on it. It is also available on phones from many manufacturers. People like choice and this may be Apple's only disadvantage, that it can only come out with a few products because it is still just one company. This is the only place where I see weakness in Apple's moat. Keep your eyes on this one because it's going to be interesting!
So, Apple at $306 is still underpriced, but not enough for us to start buying with a 50% margin of safety. If you think the EPS growth will be higher than 20%, say 23.5%, the entry price would be just above $306. If you feel comfortable making that assumption, you're good to go!
Apple's stock is probably fairly priced or a little underpriced, but not with a huge safety margin. I'll give the MOS score a 6 out of 10.
From what I read and hear about Steve Jobs, he is arrogant and somewhat of a control freak and perfectionist. Regardless, I don't think anyone can doubt that he is a brilliant man. It is by all of these traits that he's been able to steer Apple in its recent trajectory. However, a few years ago, Jobs was diagnosed with pancreatic cancer. He underwent surgery and returned to health. Several years later, he took a leave of absence and had a liver transplant. As of late, his health seemed to have returned again, but he is still very thin. His health is definitely a risk for shareholders, particularly because he has been so influential to the company itself.
If Jobs were healthy, I would definitely give Apple a score of 9 or 10, but because of his health concerns, I rate it a score of 8.
The Human Right's Campaign, a pro-homosexual group, rates Apple very highly in its "Corporate Equality Index". It basically means that Apple recognizes homosexual unions as equivalent as heterosexual marriages and provides benefits. This is one issue that I have struggled with myself. Although our Catholic faith tells us that homosexual acts are sinful, we are called to be compassionate and accepting to homosexuals. I have absolutely no problem with this. However, when a company claims to be tolerant by recognizing homosexual unions, is that a compassionate action or is it actually endorsing in homosexuality? I don't want to discriminate against homosexuals, but is speaking out against homosexual unions a kind of discrimination? For now, I don't believe it is discrimination. First, I do not believe that marriage should be redefined. It has for millennia been defined as a union between a man and a woman. To illustrate my point, I will use an analogy. It is similar to a chair being defined as something you sit on that has legs, and usually not higher than waist height. Now, a group of NBA players who are taller than 7' have come together and started using tables as chairs. Because of their height and size, tables are more suitable furniture to be used for sitting. So, they ask that we change the definition of chair to include tables as well. Therefore, when benefits are not given to homosexual unions, it is not because they are being discriminated against, but rather, it is just not accepting the re-definition of marriage. For now, I will maintain this stance. So, Apple gets some points docked for endorsing in this re-definition of marriage.
Lastly, let's return to "Antenna-gate", the iPhone 4 antenna issue. Clearly, there has been a design flaw with iPhone's antenna. If there weren't, Apple would not have given away free bumper cases to consumers who bought the phone. However, I felt that Apple dropped the ball handling this incident. Instead of just saying, yes, we made a mistake, period, Apple started releasing videos of how other phones would lose reception if gripped in a certain way. They had missed the point, which was this: many people were complaining about iPhone 4's reception (including Consumer Reports), much more than any other manufacturer. Instead of admitting the fact, they tried to create an illusion that the issue really wasn't that bad, "just" 1.7% of the phone were affected. By the way, HTC claims that only 0.016% of owners complained about the Droid Eris' reception (about 100 times less than iPhone 4).
These ethical issues, although I may have made them to sound fairly bad, are actually quite minor. When you compare these issues to the issues surrounding Johnson and Johnson, you will quickly notice that Apple is probably not that bad. In any case, Apple's business itself is good for our society. It has brought incredible innovation and has made life more enjoyable. Can you imagine a world without touch screens that let you swipe to go to the next photo? or using 2 fingers to zoom in and out of a page? or iTunes? or iPads?