Is The Apple Inc. (AAPL) Stock Selloff Warranted?

Share

Shares of Apple Inc. (NASDAQ:AAPL) continue their downtrend this afternoon, breaching support in the $110 area, as sellers seem to be piling on. While the company continue to fire on all cylinders, rumors of possible cuts in Apple’s (NASDAQ:AAPL) supply chain may indicate a slowdown in iPhone sales. With that said, even if the numbers reported by several analysts, who supposedly have information from Apple’s suppliers, are correct, that would only indicate an EPS for the quarter approximately 10-15 cents lower than expectations. In the whole scheme of things, this should hardly move the stock, but perhaps investors are worried that the iPhone may have peaked.

Regardless of this information, Apple is currently trading at a PE ratio of just over 12, and has over $206 billion in cash on their balance sheet. At some point value investors should be entering the stock. The stock is down 1.21% or $1.34 following the news, hitting $109.15 per share. Approximately 26.50M shares traded hands. AAPL shares have declined 12.32% since May 13, 2015 and are currently downtrending. It has underperformed the S&P500 by 8.64%.

From a total of 29 analysts covering Apple Inc. (NASDAQ:AAPL) stock, 26 rate it a “Buy”, 0 a “Sell”, and 3 a “Hold”. This means that 90% of the ratings are positive. The highest target price is $200 while the lowest target price is $125. The mean of all analyst targets is $150.07 which is 37.49% above today’s ($109.15) stock price. Apple Inc. was the topic of 91 analyst reports since July 21, 2015 according to the firm StockzIntelligence Inc. Barclays Capital maintained shares on December 14 with a “Overweight” rating. Mizuho maintained shares with a”Hold” rating and a $125 target share price in their report from an October 28. Goldman Sachs upgraded AAPL stock in a recent report from November 18 to a “Conviction Buy” rating. Oppenheimer maintained the rating on October 28. Oppenheimer has a “Buy” rating and a $125 price target on shares. Finally, Macquarie Research maintained the stock with a “Buy” rating in a report they issued on an October 28.

The institutional sentiment increased to 1.18 in Q2 2015. It’s up 0.22, from 0.96 in 2015Q2. The ratio is positive, as 103 funds sold all their Apple Inc. shares they owned while 854 reduced their positions. 102 funds bought stakes while 1032 increased their total positions. Institutions now own 3.20 billion shares which is 1.58% less than the previous share count of 3.25 billion in 2015Q2.

Compton Capital Management Inc Ri holds 45.15% of its total portfolio in Apple Inc., equating to 113,694 shares. Raiff Partners Inc owns 100,000 shares representing 32.27% of their total US portfolio. Moreover, Rfg Advisory Group Llc has 25.06% of their total portfolio invested in the company, equating to 70,558 shares. The New York-based Independent Investors Inc has a total of 23.66% of their portfolio invested in the stock. Dock Street Asset Management Inc, a Connecticut-based fund reported 269,584 shares owned.

Since March 6, 2015, the stock had 0 insider buys, and 8 selling transactions for a total of $20.59 million in net activity. Maestri Luca sold 2,908 shares worth $325,347. Williams Jeffrey E sold 46,873 shares worth $5.18 million. Riccio Daniel J. sold 24,085 shares worth $3.01M. Ahrendts Angela J sold 44,789 shares worth $5.90 million. The insider Levinson Arthur D sold 70,000 shares worth $9.20 million.

Apple Inc. designs, manufactures and markets mobile communication and media devices, personal computers, and portable digital music players, and a variety of related software, services, peripherals, networking solutions, and third-party digital content and applications. The company has a market cap of $609.45 billion. The Company’s services and products include iPhone, iPad, Mac, iPod, Apple TV, a portfolio of consumer and professional software applications, the iOS and OS X operating systems, iCloud, and a variety of accessory, service and support offerings. It has 11.87 P/E ratio. The Firm also delivers digital content and applications through the iTunes Store, App StoreSM, iBookstoreSM, and Mac App Store.

COMMENTS: