Just read this article that was published six hours ago, "Wall Street Week Ahead: Big gains, low valuation - why worry?" in which it says,
"Apple Inc (AAPL.O), which has tumbled 16.6 percent this year, is 28.2 percent under its intrinsic value, based on its Friday closing price, while Exxon Mobil Corp (XOM.N) is 23.3 percent under and Bank of America Corp (BAC.N) is 53.3 percent under its intrinsic value."
The link for the article is here: http://finance.yahoo.com/news/wall-st-week-ahead-big-010307323.html
I am not saying that the recent market rally may not continue as long as the Fed will continue to buy bonds and all these large equity firms keep pushing the market up. But recently, 10 year interest rate already started creeping up. I am not saying that AAPL or XOM may not be good stocks to hold long term, but under priced? Give me a break. I will not touch AAPL unless it drops to or below 380. I will rather buy OXY or COP than XOM and I would not touch any banks especially BAC no matter how attractive they may appear. Yes, everybody is saying how great and how undervalued all these bank stocks are. That was why my stock broker recommended me to buy BAC in 2007 because he said it was so underpriced. I fired him because he was an idiot. He soon lost his job after the stock market crashed.
The problem is this recent rally and this article almost smells like a bear trap. I do not believe too many smart individual investors participated and many started selling and sitting on the side line with piles of cash.
Just read some the comments after this article:
"Ahh! another story from reuters, they should all begin, Once upon a time."