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I recently came across this list on Forbes on the largest 25 tax payers. Forbes does a bit of analysis on each of them. It is probably worth your time to jump over, but I thought I would give the highlights here:

 

Rank of tax expense

Company

Symbol

Effective Tax Rate
1 ExxonMobil XOM 39%
2 Chevron Corporation CVX 43%
3 Apple Inc. AAPL 25%
4 Wells Fargo & Co. WFC 31.2%
5 JP Morgan Chase & Co. JPM 26%
6 Wal-Mart Stores WMT 31%
7 ConocoPhillips COP 51.5%
8 Berkshire Hathaway Inc. BRK 28%
9 IBM IBM 24%
10 Microsoft Corporation MSFT 22.8%
11 Philip Morris International Inc. PM 29.5%
12 Goldman Sachs GS 33%
14 Comcast Corporation CMCS 32%
14 The Procter & Gamble Co. PG 23.5%
15 Johnson & Johnson JNJ 23.7%
16 Intel Corporation INTC 23.6%
17 Occidental Petroleum Corp. OXY 42%
18 UnitedHealth Group UHG 35.9%
19 The Walt Disney Company DIS 32.7%
20 AT&T T 27.8%
21 Oracle ORCL 21.4%
22 The Coca-Cola Company KO 23.1%
23 The Home Depot Inc. HD 37.2%
24 McDonald’s MCD 32.4%
25 Google GOOG 19.4%

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Company name JPMorgan Chase & Co.
Stock ticker JPM
Live stock price [stckqut]JPM[/stckqut]
P/E compared to competitors Good

MANAGEMENT EXECUTION

Employee productivity Good
Sales growth Poor
EPS growth Good
P/E growth Fair
EBIT growth Good

ANALYSIS

Confident Investor Rating Good
Target stock price (TWCA growth scenario) $84.19
Target stock price (averages with growth) $99.84
Target stock price (averages with no growth) $80.08
Target stock price (manual assumptions) $65.73

The following company description is from Google Finance: http://www.google.com/finance?q=jpm

JPMorgan Chase & Co. (JPMorgan Chase) is a financial holding company. The Company is a global financial services firm and a banking institution in the United States, with global operations. The Company is engaged in investment banking, financial services for consumers and small businesses, commercial banking, financial transaction processing, asset management and private equity. JPMorgan Chase’s principal bank subsidiaries are JPMorgan Chase Bank, National Association (JPMorgan Chase Bank, N.A.), a national bank with the United States branches in 23 states, and Chase Bank USA, National Association (Chase Bank USA, N.A.), a national bank that is the Company’s credit card-issuing bank. JPMorgan Chase’s non-bank subsidiary is J.P. Morgan Securities LLC (JPMorgan Securities), the Company’s the United States investment banking firm. In June 2012, the Company’s asset management business created a new unit.

 

Confident Investor comments: At this price and at this time, I think that a Confident Investor can confidently invest in this stock.

If you would like to understand how to evaluate companies like I do on this site, please read my book, The Confident Investor.

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CNET recently put out an article discussing the most profitable US corporations. The article shows that even with Apple’s disappointing quarter that caused a major drop in stock price, Apple is still had more income than anyone else. The issue is that the analysts thought that the results were going to be even better, so the analysts were disappointed. When you disappoint analysts, they punish you by saying bad things. I am borrowing the great CNET chart below.

 

Apples disappointing quarter in context chart

 

To this analysis, I would like show how cheap these stocks really are. While I try to not compare the P/E ratio of non-competitors, I think it is valid for this one exercise.

If we look at the P/E and EPS of these companies, it is quite telling how cheap Apple really is among this peer group.

 

Company

Symbol

P/E

EPS

Apple Inc.

AAPL

9.78

44.10

Exxon Mobil Corporation

XOM

9.17

9.69

Microsoft Corporation

MSFT

15.39

1.82

Pfizer Inc.

PFE

22.36

1.26

International Business Machines Corp.

IBM

14.57

14.41

JPMorgan Chase & Co.

JPM

9.64

5.20

Wells Fargo & Co

WFC

10.85

3.36

The Procter & Gamble Company

PG

19.76

3.90

General Electric Company

GE

17.08

1.39

 

It might not be obvious from looking at the above table of values. Looking at P/E as a chart shows that Apple is one of the cheapest stocks by comparing its price to the earnings of the company.

Apple's PE compared to the most profitable companies

 

It really becomes obvious then by looking at the earnings per share in chart format!

Apple's EPS compared to the most profitable companies

 

So if you think that Apple’s days are done, you may want to think again! In fact, the biggest complaint that you can say about Apple is it seems that they are not getting enough shareholder value! 

If you think that IBM is fairly priced for its earnings then it would be realistic that Apple could increase its share price by 50% if you focus on P/E! By looking at Microsoft, you could say that the price could go up 60%! This means that it is likely that Apple has more upside potential than downside risk.

My disclaimer on this site consistently says that I ‘might’ be long any stock I talk about. In this case, I am long on Apple as I write this article. However, as I consistently point out in my book, The Confident Investor, I didn’t pay for those shares! My current Apple holdings are all free.  If you want to know how to get free stock in great companies, I suggest that you read my book. You can purchase my book wherever books are sold such as Amazon, Barnes and Noble, and Books A Million. It is available in e-book formats for Nook, Kindle, and iPad.

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Company name JPMorgan Chase & Co.
Stock ticker JPM
Live stock price [stckqut]JPM[/stckqut]
P/E compared to competitors Good

MANAGEMENT EXECUTION

Employee productivity Good
Sales growth Poor
EPS growth Good
P/E growth Poor
EBIT growth Good

ANALYSIS

Confident Investor Rating Fair
Target stock price (TWCA growth scenario) $123.41
Target stock price (averages with growth) $140.35
Target stock price (averages with no growth) $94.01
Target stock price (manual assumptions) $65.49

The following company description is from Google Finance: http://www.google.com/finance?q=jpm

JPMorgan Chase & Co. (JPMorgan Chase) is a financial holding company. The Company is a global financial services firm and a banking institution in the United States, with global operations. The Company is engaged in investment banking, financial services for consumers and small businesses, commercial banking, financial transaction processing, asset management and private equity. JPMorgan Chase’s principal bank subsidiaries are JPMorgan Chase Bank, National Association (JPMorgan Chase Bank, N.A.), a national bank with the United States branches in 23 states, and Chase Bank USA, National Association (Chase Bank USA, N.A.), a national bank that is the Company’s credit card-issuing bank. JPMorgan Chase’s non-bank subsidiary is J.P. Morgan Securities LLC (JPMorgan Securities), the Company’s the United States investment banking firm. In June 2012, the Company’s asset management business created a new unit.

 

Confident Investor comments: At this time, I think that a Confident Investor can cautiously invest in this stock as long as the price is correct. Most of the fundamentals of this company are good but there are some concerns. I am going to leave the stock on my Watch List since the biggest reason the stock has dropped to Fair is the slower growth of sales in the last several years. If sales increases with a healthier economy then it is likely that JPM will be even stronger.

 

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Company name JPMorgan Chase & Co.
Stock ticker JPM
Live stock price [stckqut]JPM[/stckqut]
P/E compared to competitors Good
MANAGEMENT EXECUTION
Employee productivity Fair
Sales growth Good
EPS growth Good
P/E growth Good
EBIT growth Good
ANALYSIS
Confident Investor Rating Good
Target stock price (TWCA growth scenario) $215.16
Target stock price (averages with growth) $184.93
Target stock price (averages with no growth) $108.68
Target stock price (manual assumptions) $50.62

The following company description is from Google Finance: http://www.google.com/finance?q=jpm

JPMorgan Chase & Co. (JPMorgan Chase) is a financial holding company. JPMorgan Chase’s principal bank subsidiaries are JPMorgan Chase Bank, National Association (JPMorgan Chase Bank, N.A.), a national bank with United States branches in 23 states, and Chase Bank USA, National Association (Chase Bank USA, N.A.), a national bank that is the Firm’s credit card-issuing bank. JPMorgan Chase’s principal nonbank subsidiary is J.P. Morgan Securities LLC (JPMorgan Securities), the Firm�s United States investment banking firm. The bank and nonbank subsidiaries of JPMorgan Chase operate nationally, as well as through overseas branches and subsidiaries, representative offices and subsidiary foreign banks. The Company’s activities are organized into six business segments: Investment Bank, Retail Financial Services (RFS), Card Services (CS), Commercial Banking (CB), Treasury & Securities Services (TSS) and Asset Management (AM).

Confident Investor comments: At this price and at this time, I think that a Confident Investor can confidently invest in this stock.