In the latest trading session, Apple (AAPL) closed at $214.10, up +0.4% from the previous day. The company’s stock price outperformed the S&P 500, which was up 0.09% on the day. Elsewhere in the market, the Dow rose 0.09% and the tech-heavy Nasdaq added 0.3%.
Prior to today’s trading, shares of the company, which makes iPhones, iPads and other products, had gained 12.07% over the past month, outpacing the Computer and Technology sector’s gain of 6.18% and the S&P 500’s gain of 3.38% in that time period.
Apple’s upcoming earnings release will be of major interest to investors, as the company is expected to report EPS of $1.33, up 5.56% from the year-ago period, while our latest consensus estimate is calling for revenue of $83.46 billion, up 2.04% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings per share of $6.59 and revenue of $385.99 billion, which would represent increases of +7.5% and +0.71%, respectively, from the prior year.
It is also important to note that analyst estimates for Apple have been changed recently. These recent revisions tend to reflect changing near-term business trends. With this in mind, we believe positive estimate revisions indicate optimism about the company’s business outlook.
Our research has demonstrated that these estimate adjustments are directly correlated to impending stock price movements, and we developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate revisions into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an outside-audited track record of outperformance, with #1 ranked stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.17% higher. Apple currently has a Zacks Rank #3 (Hold).
In terms of valuation, Apple is currently trading with a Forward P/E ratio of 32.38. In comparison, its industry has an average Forward P/E of 11.63, which means Apple is trading at a premium to the group.
Additionally, AAPL currently has a PEG ratio of 2.59. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes into account a company’s expected earnings growth rate. The average PEG ratio for the Computer – Mini Computer industry was 2.23 as of yesterday’s close.
The Computers – Minicomputers industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of #48, putting it in the top 20% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by determining the average Zacks Rank of the individual stocks that make up the groups, and our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
More information on all these metrics, and much more, can be found on Zacks.com.
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Apple Inc. (AAPL) : Free Stock Analysis Report
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