Does anyone know a rule of thumb of how long it takes the stock price to recover when a stock goes from being a growth stock to a value stock?
Why does anyone need to classify/categorize a company that can sell 10units/second? And generate cash flows of $1b/week? Especially when market cap less tangible equity is equal to 6yrs of profits at zero growth.
You mean, how long is it going to take before AAPL is considered a growth stock again. Afterall, Apple is selling more iPhones in the US than anyone; far more than last year. And Apple will start selling iPhones through T-Mobile. So, it probably will be after the China Mobile deal is announced.
Sentiment: Strong Buy
I don't think there is any hard and fast rule but DELL is essentially a value stock now and it was roughly a 5 year process. I would say there is usually at least a couple of years of denial by shareholder before it is widely accepted that it is no longer a growth company and I think that AAPL will be the same way.
You cannot assume AAPL has turned into a value stock. In what just 4 months? somehow the entire company has become stupid? Are all their engineers just sitting tight drinking margaritas? They could easily announce two new products with even mild success that will increase earnings and analysts will be pumping up estimates again. Then we will back to the casino.
Sentiment: Buy
It is not 4 months. It has been 3 years since they released something WOW.
The rule of thumb is:
If someone can ask a stupid question, someone will.
There is no magic formula for that. The price action will tell you when to get back in.