We used reverse valuation by DCF model with price level of $185 as base on Apple Inc. At the current price, AAPL should grow its earnings by 37% annually for the next 10 years with terminal growth of 3%. Now the question is - can it grow by 37% annually? With 90% probability, I guess it is not possible. In Technology business, continuous and successful innovation is the life blood. Apple is all about a vision to innovate in common man's life. It is all about some collective people's dream. So here the key managerial person is the whole heart and soul of this company. With all these points in mind, we strongly believe that this business can't grow at much. 

Having said that, we cannot predict Mr. Market's manic behavior. He would go on with more valuation to Apple. But based on fundamentals, the current price of $200 is not justifiable. Hence I would go long short on apple.

Click here to see our report on AAPL and Click here for valuation model