“Apple Inc. could be on the verge of a rebound based on a technical analysis of the trading chart,” Michael Kramer writes for Investopedia.
“Shares have come under pressure recently, as investors turned negative on the iPhone super-cycle, and the broader market force turned negative, dragging the stock lower,” Kramer writes. “But despite the recent declines, Apple is showing that it could be putting in a trading bottom, and may be set to rise over the coming weeks.”
“Market volatility has been intense over the past couple of trading sessions, with the S&P 500 falling by over 4% since January 18. But, Apple has fared even worse, falling by nearly 9%, and by roughly 13% at its lowest point during the same time. However, the technicals are suggesting it reached oversold levels,” Kramer writes. “Even from a fundamental standpoint Apple now has a one-year forward price-to-earnings ratio of 12.4, which given the stock has roughly 14% year-over-year earnings growth, makes the shares of the stock relatively cheap — given the stock has a PEG ratio of less than 1.”
Read more in the full article here.
MacDailyNews Note: In premarket trading this morning, AAPL is up slightly 0.60% to $160.50 per share.
[Thanks to MacDailyNews Reader “David E.” for the heads up.]
“technical analysis of the trading chart”. As I’ve gotten older I’ve began to realize how much the stock market is similar to Astrology – bunk and hokum.
Considering Apple is probably one of the most profitable companies around, with probably one of the lowest P/Es of any major tech stock and certainly having the most repatriated cash of any company on Wall Street… I definitely think Apple stock SHOULD recover better than most stocks.
However, I’ll bet Apple will recover much slower than any FANG stock, Microsoft, NVidia, VMWare, and Tesla. All of the companies I mentioned have P/Es two and three times higher than what Apple’s P/E is. Seriously, only wusses are holding Apple stock and as soon as they hear some unconfirmed story about how iPhone sales are weakening, then look out below. Those gutless “investors” will be dumping more Apple stock like there’s no tomorrow.
I’m not sure what the next negative catalyst will be to send Apple stock down further but I’m sure a bunch of analysts is already planning another Apple blitz when they show their ugly mugs on CNBC. There is always so much doom and gloom news being tossed in Apple’s direction, it’s hard to comprehend that a company that successful has so many things supposedly wrong when it comes to running their business.
Yeah, I bought at $10, price adjusted. I’m a real wuss. I’ll continue to hold Long, thank you very much!
Stock Market 101: Wall Street doesn’t control, decide or “set” the price of a stock. Nor does it “reflect” the state of the economy, let alone the state of any company represented.
For example, the success of Apple (or lack thereof) has no direct effect on the price of Apple’s stock. Rather, when traders are (in general) more interested in selling it than buying it, the price of a stock declines. The opposite is also true.
If you “Play” the stock market (trade) you quickly discover the only way to make money on a rising stock is to be among the first to buy it (when it is still low). And the only way to avoid losing money on a declining stock is to be among the first to sell it (when it is still high). The net result, folks, is traders don’t watch the company behind the stock. They are watching each other. If a few start selling a stock, the rest rush to sell it, too. If they hear some news (or some analyst’s comments) that they think will cause other traders to react, they will try to be among the first to so react. Thus they become a self-fulfilling prophecy.
Investors, on the other hand, are interested in the company. They buy and hold for the long term. For them, it’s a savings account with (hopefully) a better return. But because of this, Investors don’t influence price changes in any way.
Wall Street is not smart, stupid or clueless. People who cry, “They just don’t understand Apple,” don’t understand the market. It’s a mob-mentality, pure & simple. They don’t care about you, me or Apple. They only care about each other and any “skill” they may have is simply the ability to predict what other traders might do before they do it.
In other words, “traders” are like sheep… If a few suddenly start to run, they all run and in the same direction. Only afterward will analysts attempt to figure out why.
What’s the solution for Apple? Minimize their reliance/exposure to traders. So, you begin share buy-backs and bond issues – with an eye toward reducing your risk (from traders) or perhaps one day eliminating it! (Get out of the stock market and go private. All they’d really need is lots of money to fund themselves! Hmmm.)
I’ll get off my soap-box, now.
To reduce significant shares floating, Apple got to accelerate shares buybacks, Down to two or one half billion shares. Right now Apple has 5.07 billion shares, way too many.
Apple will bounce back because anything that drops that dang fast has got to bounce eventually… I might, like, RIGHT THERE where the drop stops being a drop. The problem is, you don’t know if a drop has stopped being a drop until… you know, the dropping stops.
To reduce significant shares floating, Apple got to accelerate shares buybacks, Down to two or one half billion shares. Right now Apple has 5.07 billion shares, way too many.