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Apple (AAPL) Dips More Than Broader Markets: What You Should Know

In the latest trading session, Apple (AAPL) closed at $192.23, marking a -1% move from the previous day. This change lagged the S&P 500's 0.15% loss on the day. At the same time, the Dow lost 0.4%, and the tech-heavy Nasdaq 0%.

Coming into today, shares of the maker of iPhones, iPads and other products had lost 10.67% in the past month. In that same time, the Computer and Technology sector lost 5.26%, while the S&P 500 lost 1.27%.

Investors will be hoping for strength from AAPL as it approaches its next earnings release, which is expected to be February 7, 2019. The company is expected to report EPS of $4.76, up 22.37% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $91.94 billion, up 4.13% from the prior-year quarter.

AAPL's full-year Zacks Consensus Estimates are calling for earnings of $13.35 per share and revenue of $278.75 billion. These results would represent year-over-year changes of +12.09% and +4.95%, respectively.

It is also important to note the recent changes to analyst estimates for AAPL. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.72% lower. AAPL is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that AAPL has a Forward P/E ratio of 14.55 right now. This valuation marks a discount compared to its industry's average Forward P/E of 15.73.

It is also worth noting that AAPL currently has a PEG ratio of 1.4. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Computer - Mini computers industry currently had an average PEG ratio of 1.74 as of yesterday's close.

The Computer - Mini computers industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 64, putting it in the top 25% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow AAPL in the coming trading sessions, be sure to utilize Zacks.com.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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