Should You Follow Bill Miller Into This Tech Giant? Apple Inc. (AAPL), Research In Motion Ltd (BBRY)

That being said, it’s not as if Apple is struggling. The company still booked 45% revenue growth year over year in fiscal 2012.Apple Inc. (NASDAQ:AAPL)’s growth is a clear operating advantage over Research In Motion Ltd (NASDAQ:BBRY). Unfortunately for BlackBerry, its struggles are well-known and it is unclear if the new device will right what is wrong with the company. The company suffered mightily from declining market share, particularly in the enterprise market, which was its bread and butter. In December, Research In Motion Ltd (NASDAQ:BBRY) reported that third-quarter revenue fell a whopping 47% year over year. Diluted net income per share came in at a miniscule $0.02, compared to $0.51 per share in the same quarter the year prior.

A compelling valuation

Miller is a noted value investor, and as a result it shouldn’t be a big surprise that he believes another catalyst for Apple is its extremely cheap valuation. If you back out Apple’s cash on its balance sheet, the stock trades at just 7 times its trailing fiscal 2012 diluted earnings per share.

Miller finds it interesting, as do I, that Google Inc (NASDAQ:GOOG) and Apple are likely to report similar earnings per share this year. Amazingly, Google trades above $800 per share, while Apple currently trades for around $430 per share. This underscores the profound difference in the valuation multiples the market is awarding each stock.

To be sure, Google is a spectacular business with demonstrated growth. The company’s full-year 2012 revenues soared more than 30% year over year, and have more than doubled since 2008. Diluted earnings per share clocked in at $32.31 per share. That means that Google is trading for more than 25 times its trailing earnings.

However, Apple had better revenue growth than Google in 2012, and it also offers investors a dividend, which Google does not. As a result, is it right that Google trades for almost twice the price that Apple does? Miller seems to think not, and I’m inclined to agree. I believe that Google deserves its valuation, and that Apple deserves a comparable one.  At some point, the market’s irrationality will fade and the stock will be rewarded as an innovative marvel.

The article Should You Follow Bill Miller Into This Tech Giant? originally appeared on Fool.com and is written by Robert Ciura.

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