Sign InApple Stock Shows Potential for Growth Despite Overbought Conditions
Summary
Apple Inc.'s stock may potentially increase in the next trading day and week ahead due to positive sentiment from strategic business moves and acquisition news, although caution should be exercised due to the stock being overbought and the potential for a downtrend.
Market Overview
Apple Inc. (NASDAQ: AAPL) closed at $189.70 as of September 5, 2023. On this trading day, the stock experienced a minuscule change of $0.24 (0.13%). The day's stock price oscillated between $187.61 (Low) and $189.98 (High), falling a little short of its year high of $198.23. Headquartered in Cupertino, California, the tech giant holds an impressive market capitalization of about $2.97 trillion.
Trading volume for the day was 44.50 million shares, lower than the average volume of 54.98 million shares. From a technical standpoint, RSI14 stands at 71, suggesting that the stock is currently in the overbought territory. Furthermore, the company's 50-day moving average ($186.71) and 200-day moving average ($163.41) indicate an upward trend in Apple's stock price.
Technical Indicators
Apple's MACD (3-month) stands at -4.79. A negative MACD indicates that the stock might be on a downward trend. The Average True Range (ATR), which measures market volatility, is 1.63, indicating the stock has been moderately volatile. Also, Apple has a support price of $184.92 and a resistance price of $193.13.
Apple's stop-loss, which can help investors limit their losses, is estimated at $181.85.
Fundamental Analysis
Apple's earnings per share (EPS) is $5.96 with a price-to-earnings ratio (PE) of 31.83. The number of shares outstanding is 15.63 billion. Moreover, the company's Discounted Cash Flow (DCF) is valued at $191.15, slightly exceeding the last closing price. This may suggest the stock is undervalued.
An assessment of company targets shows a high target of $240 and a bearish low estimate of $110. The consensus target is set at $186.76, lower than the last closing price, while the median target is $192.50. Furthermore, most analysts rate Apple as a buy, with 24 buys and 8 holds. There is only one sell rating, and no strong sell recommendations.
Upcoming Calendar Events
The next trading day for Apple is September 6, 2023. The tech giant is set to announce its earnings on October 25, 2023.
Recent News
Apple continues to make strategic acquisitions, as recent news suggests the company acquired the Swedish record label BIS Records. This move should enhance its Apple Music Classical and Platoon music services. Another significant update is a new long-term deal with Arm for chip technology that extends beyond 2040.
Stock Prediction
Considering the technical and fundamental metrics, as well as recent company activities, Apple's stock price may potentially increase over the next trading day and week ahead. Its stock may possibly ride on the positive sentiment created by strategic business moves and acquisition news.
However, investors should be cautious since the RSI14 suggests that the stock is currently in an overbought condition, which often precedes a sell-off. Also, the negative MACD may signify a potential downtrend.
Final Evaluation
Apple Inc.'s position is evaluated as a 'Hold' considering the observed conditions. While the stock is likely overbought and could see a short-term pullback, Apple's strong fundamentals and business prospects in the foreseeable future make it a worthwhile holding for the long term. In addition, the company's strategic acquisitions and the new long-term deal with Arm signals potential growth in the future. Hence, it could be an attractive buy for patient, long-term investors on a price dip. The above analysis and recommended course of action are based on the data provided and are not personal investment advice.
