In a recent note, BofA’s Michael Hartnett identified two risks to the market.
The first was China (which is an oft-discussed threat/issue) and the second one was … Apple.
In fact, he even put up a version of this chart (via ZeroHedge) to show how freakishly large the stock had become.
Basically, Hartnett’s point is that this stock is getting so large that it alone poses a risk to the market.
Earlier this week, Doug Kass posted this chart comparing Apple to Google right before the market peak in 2007, which of course preceded the crash of 2008.
Photo: Doug Kass
It should be noted that Apple actually cooled off a bit this week, and also that from a metrics point of view, the stock is famously un-bubblicious. Its PE ratio is basically right in line with the market, while its pace of growth is still remarkable.
Still, the unease about this stock that goes straight up, commanding so much market cap-share and attention is obviously growing.
UPDATE: Twitterer @Ktr8der sends us this chart showing the PE ratios of Apple and Google going back before the last crisis. As you can see, Apple’s PE ratio is nothing like Google’s nosebleed PE ratio of 50 before the market collapsed.
Click the image to enlarge