Barron's Summary (AAPL, S, AVT, UA, )

Barrons’ “The Trader” column discusses Apple (AAPL), whose shares are down 35% in a month. At 130, shares trade at 20.7x forward earnings, the cheapest in a while. Stripping out its big cash stash, the stock trades at about 13x FCF. While the Street frets about slowing iPod sales, it's easy to forget Apple’s range. Mac revs grew 47% last qrtr. Unit sales are expected to increase at a pace more than double the industry's 11.6%, and Apple continues to gain share in the computer and phone mkts. Investors moaning about the 4m iPhones sold so far forget that Apple had no mobile-phone presence just a yr ago. Margins near 35% should improve with cheaper component prices, and Apple is rolling out its new operating system and iPhones overseas. In fact, Apple's knack for packaging aspiration and creating things ppl feel compelled to own will stand it in good stead in a spending slowdown. The new "MacBook Air," for instance, has inspired lust among existing laptop owners, and the buzz among young media types means consumer magazines will pant after it in print for mo’s to come. If history holds true, profit taking in Apple will exhaust itself about 21 days after the earnings report. Last week, Citigroup analyst Richard Gardner called the sell off "overdone." Deutsche Bank analyst Chris Whitmore has a 225 price tgt.

Barron’s cover out saying that the downdraft in the market may not be over, but some stocks already look inexpensive and worth a long-term bet. "These are some of the best opportunities that I've seen in the past seven yrs," says Mark Boyar, of Mark Boyar & Co. Co’s worth a look include: BAC, WB, WFC, C, PFE, LIZ, HOG, DOW, MET, TWX, CBS, FNM, GCI, IACI, CB, COP, FCX, BA, GE, CMI, DIS, MO and MOT.

Barron’s Roundtable members like WMI, ROH, INTC, XLNX, EUM, FXP, SCJ, FIS, HAFC, BAC, LNC, PAY, CHK, HIG, DVN, ESV, AVT, ROST, ZINC and ELRN. Shorts include: XLY, FXI and DRYS.

Buyers of Chinese IPOs beware. A research house finds many of these US-listed issuers still offer poor governance and accounting, as well as lower-quality earnings. "The results are quite striking," says Victor Germack, of RateFinancials. "And these are from the documents of record, b/c Regulation FD says they have to reveal public information through their filings. This is what investors rely on, not puff pieces from the co." The five are GA, LDK, NPD, YGE and GRO.

If Systemax's (SYX) high gross margins have been fattened by failure to pay out manufacturer rebates, then an end to that alleged behavior might crimp profits, and the share price. "Having a business model that heavily involves rebates, there's nothing inherently wrong in that, as long as you play it fair," says Matthew R. Wilson, a class-action lawyer who's suing TigerDirect and Systemax in a NY federal district court.

The shares of Helmerich & Payne (HP), up nearly 45% since the start of 2007, look poised to climb by at least another 40%, even as rivals with older gear are punished. "What we are seeing is an opportunity to take market share...in a softer environment, because there is such a need for reinvestment and retooling,'' says CEO Hans Helmerich.

According to “The Trader” column, Dan Frascarelli, of Lord Abbett, thinks the 1990 slowdown, with its troubled banks and anemic capital ratios, offers a better comparison than 1998. Then, it took yrs for banks to rebuild their balance sheets. While cyclical stocks do well when the Fed cuts rates, he thinks it's "too early" to take an aggressive stance, partly b/c "we haven't seen the worst of the economic data yet." Frascarelli favors PG, CL, CVS, K, KFT, ABT, JNJ, MRK, FPL and D.

“Follow Up” section highlights Under Armour (UA), saying that the selloff has given long-term investors a chance to snap up a quality, fast-growing sports-apparel franchise at its lowest price in more than a yr. Barron’s thinks the potential reward outweighs the risks. But if its foray into non-cleated footwear is a hit, Under Armour's stock could move back into the low-40s within a yr. The co has made its pricey apparel and football cleats must-haves among young jocks, and bulls think it can work similar magic with cross-training sneakers. Cross-trainers could add $40-50m in rev beginning in the 2Q, and eventually $1bn of sales and more than $2 a share of profits. Says Matt Powell, of SportsOneSource. "I wouldn't be surprised if Under Armour takes a 10% share of the cross-training mkt in the first yr."

“Plugged In” column discusses Apple’s (AAPL) iPhone sales. Last week, AT&T (T) revealed that as of yr-end it had only 2m or so active Apple subs. That's a disconnect b/c Apple just announced with great fanfare at MacWorld that is has sold more than 4m phones. Considering that 3.75m units were sold through Dec31 and assuming about 350K of those were sold in Europe, that leaves about 1.4m US iPhones missing in action, says Bernstein analyst Toni Sacconaghi. "We were anxious about inventory b/c Apple was so reticent about it," Sacconaghi told. Unaccounted inventory "was a little bigger than we thought," he says. There are two things that can account for the missing handsets: carrier inventory and unlocked phones. iPhone owners who didn't want to use AT&T or Apple's European wireless carriers have cracked open the phones to use with unauthorized networks. Nobody knows how big this number is except for Apple and the carriers. Sacconaghi ests that about 20% of all iPhones sold are improperly unlocked, which, he says, means at least 670K iPhones are sitting on the shelves of AT&T and the euro-carriers.

“Technology Trader” highlights Avnet (AVT) that sells thousands of products to more than 100K customers. That makes Avnet a canary in a coal mine for IT spending, semiconductors and hardware. Still, the stock seems to discount any coming weakness. Distributors don't carry high multiples; as CEO Roy Vallee notes, they tend to have relatively low margins and no patents or intellectual property. But Avnet seems to be an underappreciated growth machine. For 7 yrs, he says, it has been increasing its return on capital and cash flow, then using the cash to do "value-creating acquisitions," which boost rev and profit growth. It's also strengthened "core operations, improving scale and scope as we go." But Vallee complains that the Street gives the stock zero respect. Avnet trades at a PEG ratio around 0.5. It trades at a P/E of less than 10x estd ‘09 EPS, and fetches just 0.3x last yr's sales. Says Vallee: "The Street is either not getting our story, or not believing it yet." For tech investors, not a bad place to hide.

“Technology Trader” also discusses Sprint Nextel (S), which has some very valuable unused spectrum, which it intends to use to build out a wireless broadband network. And now Sprint has a new, attractive feature: a stock down 31% this yr. The rumor mill is spinning wildly. The co has often been rumored to be an acquisition tgt for Comcast (CMCSA), but that's a long shot. A more intriguing notion has the co cutting a deal with Google (GOOG), which is currently playing a key role in the 700 MHz bandwidth auction under way. Some think that Google could take a significant equity stake in Sprint, which would be a lot cheaper than building a new service provider. Another theory: Sprint could be bought out by private-equity investors. In Nov Sprint had rejected a proposal from SK Telecom and Providence Equity Partners to invest $5bn in the co and to install Sprint's former chmn, Tim Donahue, as CEO. That was with the stock north of $15. Now it's barely over $9. But the spectrum gets only more valuable over time, the current auction will provide a good gauge of what it's worth. The stock, in short, is simply too cheap to ignore.