Last Thursday, ExxonMobil, a multinational oil and gas company from the US, handed over the most valuable company title to Apple Inc. Apple's stock was up around 17% since the tech giant reported its second quarter earnings. However, analysts said that the stock still looked like a bargain.

Apple's profit and earnings per share growth rates were slowing down, but with launching new generation of iPads and iPhones, Apple's rate is expected to boost up again. Apple analysts anticipated that for the next five years, Apple would grow its earnings per share by 18.3% yearly.

Analysts computed that if Apple would grow its earnings per share by 3% in proportion to the inflation rate for the next ten years, a cut-rate cash flow valuation would yield a fair value. Analysts added that Apple shares could be US$619 each by using 10% discount rate.

However, venture capitalists would not want to purchase a company at a fair value since they would always leave room for error. Fortunately, the company trades today at around 25% discount to US$619. This would provide investors a margin of safety. They concluded that a company that could release new products, draw the attention of every consumer and trade at a discounted price would be an excellent buy.