Sign InApple Inc. (AAPL) Shows Potential for Modest Rise Despite Bearish Indicators
Summary
Technical and fundamental analyses indicate that Apple Inc. (AAPL) may see a modest rise in stock price with potential continued upward movement in the following week, making it a recommended 'Buy'; however, investors should closely monitor technical indicators and market sentiment before making a decision. (August 25, 2023)
Technical Analysis
At the last close on August 24, 2023, Apple Inc. (AAPL) was trading at $176.38, down by 2.62% or $4.74 from the previous day. The trading session saw the stock hitting a low and a high of $176.02 and $181.104 respectively. Over the year, AAPL has seen a high and low of $198.23 and $124.17, indicating significant volatility.
The stock's Relative Strength Index (RSI) over 14 days is marginally lower at 39 which represents neither overbought nor oversold conditions. The 50-day moving average stands at $186.77, higher than the current price, suggesting a bearish trend in the short term. However, the 200-day moving average is $162.16, which is lower than the current price, indicating a bullish trend in the longer term. The divergence between these averages could signal a potential opportunity for investors. The MACD, a momentum oscillator, is negative at -6.83, indicating downward price momentum.
The average daily trading volume of Apple Inc is 10.75 million shares, significantly lower than the average volume of 57.36 million shares, indicating lesser trader interest. Apple Inc. is traded on the NASDAQ exchange.
Fundamental Analysis
Apple Inc. holds a significant market cap of around $2.76 trillion, with approximately 15.63 billion outstanding shares. The tech giant flagship reported an EPS of $5.96 with a PE ratio of 29.62, suggesting that the market has high expectations of future earnings growth.
A crucial technique for evaluating a company's intrinsic value, the discounted cash flow (DCF), stands at $177.99, just above the current stock's price, which suggests the stock may be slightly undervalued. Target price estimates range from a low of $110 to a high of $240, with a median of $192.50. The consensus among 33 analysts is a 'Buy' with 24 indicating 'Buy', 8 a 'Hold', and 1 a 'Sell'.
News Impact and Predictions
Recent publications have pointed out that Apple is the most 'under-owned' big tech stock among large investors, suggesting potential upward price movement as institutions correct this underweight allocation to Apple's shares. Another source acknowledged the potential for growth in Apple's monetizable installed base, particularly in markets like China and India. This is a firm indication of the strong investment potential of Apple Inc.
For August 25, 2023, considering both technical and fundamental analyses, currently bearish short-term indicators and slightly undervalued DCF, the stock price may see a modest rise and a potential continued upward movement over the following week.
Final Evaluation
Considering the significant market capital, projected growth, robust earnings per share, and analyst consensus, the recommendation for Apple Inc. (AAPL) is a 'Buy'. However, investors should monitor the technical indicators closely and consider market sentiment before making their moves. The overall investment decision should also take into account their investment goal, risk tolerance, and investment horizon.
