October 26, 2016, 4:15pm EST

As of the end of last week, 78% of the companies that have reported earnings for the most recent quarter have beaten estimates.

That’s on about a third of S&P 500 companies that have reported thus far. Remember, FactSet says on average (the five-year average), 67% of companies in the S&P 500 beat their analyst expectations. And they beat by an average of 4%.  So the numbers in this earnings season are running a little hotter, albeit on a lowered bar.

We’ve talked quite a bit in the past week about the run up to Apple earnings, which came in yesterday after the market close.  The earnings number beat expectations.  But it was by a slim margin.

The stock was lower on the day.  Still, on the second quarter report, this past July, Apple was a sub $100 stock (trading at just above $96).  Today it will close above $115.  That’s 20% higher in the span of one quarter, and it was on a report that was very much in line with the report we heard yesterday.  And the report included only a few weeks of the new iPhone7 release.  And it doesn’t reflect implosion of Apple’s competitor, Samsung.

As the media and analyst tend to do, especially when the macro news front is quiet and market volatility is quiet, they picked apart and speculated on the future of Apple today as a company that may have peaked.

Let’s just take a look at the stock, and not pretend to have better visibility on the future of the company than the people do inside — the same one’s that put a transformational supercomputer in our pockets.

The stock still trades at 13x earnings.  The S&P 500 trades at 16x.  Apple trades at 13x next year’s projected earnings.  The S&P 500 trades at 16.5x. Clearly it’s undervalued compared to the broader market.  What about Apple’s monster cash position?  Apple has even more cash now — a record $237 billion. If we excluded the cash from the valuation, Apple trades at 8.6x earnings. Though not an apples to apples (pun), and just as a reference point, that valuation would group Apple with the likes of these S&P 500 components that trade 8 times earnings:  Dow Chemical, Prudential Financial, Bed Bath & Beyond, a Norwegian chemical company (LBY), and Hewlett Packard Enterprise.  It’s safe to say no one is debating whether or not Hewlett Packard is at the pinnacle of its business. Yet, if we strip out the cash in Apple, AAPL shares are trading at an HPE valuation.

Apple still looks like a cheap stock.

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