A look at past declines in Apple’s stock indicates this rout has further to go

“In the past three downturns, says analyst Toni Sacconaghi, Apple’s share price bottomed only after sell-side EPS estimates had bottomed,” Philip Elmer-DeWitt reports for Apple 3.0. “From a note to clients that landed on my desktop Wednesday:”

Before this most recent swoon, Apple’s stock had materially underperformed the market only three times within the last decade: (1) the iPhone 5 cycle from late 2012 to 2013; (2) the iPhone 6S cycle in early 2016; and (3) the first half of the iPhone X cycle…

Apple’s stock price has historically bottomed only once sell-side EPS estimates have bottomed… Sell-side estimates have only been revised downwards by -0.8% so far, and history suggests that the stock is unlikely to inflect until estimates stop coming down.

Read more in the full article here.

MacDailyNews Take: Watch the lemmings. They’re predictable.

When the lemmings, er… ‘analysts’ start their upgrade parade, then you’ll know the bottom has been found. — MacDailyNews, November 26, 2018

RBC cuts Apple price target citing ‘data points around soft iPhone demand from supply-chain and others’ – November 27, 2018
Apple rout worsens after President Trump suggests the U.S. could place a 10% tariff on iPhones and laptops made in China – November 27, 2018
Is Warren Buffett adding to Apple under $175? – November 26, 2018
Explaining the recent Apple selloff, and why the stock looks undervalued – November 23, 2018
Apple is no longer worth anywhere near one trillion dollars – November 23, 2018
Apple to lower iPhone XR pricing in Japan in order to boost sales – November 23, 2018
Why the bad news on Apple keeps on coming – November 23, 2018
In the darkest hour of Apple’s ‘white-knuckle period,’ some investors are loving it – November 21, 2018


    1. Gee, 3 out of 4 commenters above offered valuable insights and something other than psychotic repetition of their previous hundreds of scrawlings. Guess which one didn’t!?

      The drooling, dribbling “Ishkabibble Von Tink! See what benefit you can pluck from his oft repeated meme:
      “Just looking at the feckless and uninspiring CEO tells investors that this route has a long way to go. Down.”
      Thanks for nothing; again, and again and again and…….

  1. Assuming that past performance of a stock is a meaningful indicator of future performance is asking for trouble.

    There are many factors governing how a particular stock will perform in the future, but previous history, shapes of graphs or patterns in tea leaves are amongst the least accurate ways to predict future performance.

  2. In other words: The stock price is likely to keep going down until it starts going back up, and estimates will go down until they start going back up, and there is no predictable point at which any of this will happen, based on all previous models.

  3. “the stock is unlikely to inflect until estimates stop coming down”
    Which is nonsensical garbage given that the analyst estimates are typically trailing indicators.

    “Apple’s stock is “typically anticipatory of estimate declines”
    Totally contradicts his other statement. He says the stock will decline until estimate revisions stop, but then he says the stock anticipates the estimate decline. Which one is it?

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