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

Zacks Equity Research
·3-min read

Apple (AAPL) closed at $126.85 in the latest trading session, marking a -2.58% move from the prior day. This move lagged the S&P 500's daily loss of 1.04%.

Prior to today's trading, shares of the maker of iPhones, iPads and other products had lost 0.12% over the past month. This has lagged the Computer and Technology sector's gain of 3.67% and the S&P 500's gain of 3.83% in that time.

The company is expected to report EPS of $0.97, up 49.23% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $72.1 billion, up 20.8% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $5.10 per share and revenue of $353.04 billion, which would represent changes of +55.49% and +28.6%, respectively, from the prior year.

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Investors might also notice recent changes to analyst estimates for AAPL. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 13.64% higher. AAPL is currently a Zacks Rank #2 (Buy).

In terms of valuation, AAPL is currently trading at a Forward P/E ratio of 25.51. This represents a premium compared to its industry's average Forward P/E of 18.96.

We can also see that AAPL currently has a PEG ratio of 2.04. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Computer - Mini computers industry currently had an average PEG ratio of 1.69 as of yesterday's close.

The Computer - Mini computers industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 44, which puts it in the top 18% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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Zacks Investment Research