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Apple (AAPL) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research

Apple (AAPL) closed the most recent trading day at $244.78, moving -0.77% from the previous trading session. This move lagged the S&P 500's daily gain of 0.47%. Elsewhere, the Dow gained 0.95%, while the tech-heavy Nasdaq added 2.3%.

Prior to today's trading, shares of the maker of iPhones, iPads and other products had lost 23.78% over the past month. This has was narrower than the Computer and Technology sector's loss of 28.18% and the S&P 500's loss of 28.7% in that time.

Investors will be hoping for strength from AAPL as it approaches its next earnings release. In that report, analysts expect AAPL to post earnings of $2.58 per share. This would mark year-over-year growth of 4.88%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $60.25 billion, up 3.85% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $13.40 per share and revenue of $272.50 billion, which would represent changes of +12.7% and +4.74%, respectively, from the prior year.

Any recent changes to analyst estimates for AAPL should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 2.37% lower. AAPL is currently a Zacks Rank #3 (Hold).

Digging into valuation, AAPL currently has a Forward P/E ratio of 18.41. This represents a premium compared to its industry's average Forward P/E of 7.69.

Also, we should mention that AAPL has a PEG ratio of 1.75. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. AAPL's industry had an average PEG ratio of 1.75 as of yesterday's close.

The Computer - Mini computers industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 51, which puts it in the top 20% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

Click to get this free report Apple Inc. (AAPL) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research