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

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Apple (AAPL) closed the most recent trading day at $228.68, moving +0.38% from the previous trading session. This change outpaced the S&P 500’s 0.07% gain on the day. At the same time, the Dow lost 0.13%, and the tech-heavy Nasdaq gained 0.14%.

Coming into today, shares of the maker of iPhones, iPads and other products had gained 17.97% in the past month. In that same time, the Computer and Technology sector gained 8.61%, while the S&P 500 gained 4.34%.

The investment community will be closely monitoring the performance of Apple in its forthcoming earnings report. The company is scheduled to release its earnings on August 1, 2024. The company’s earnings per share (EPS) are projected to be $1.33, reflecting a 5.56% increase from the same quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $83.75 billion, up 2.38% from the year-ago period.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $6.59 per share and a revenue of $386.4 billion, indicating changes of +7.5% and +0.81%, respectively, from the former year.

Investors might also notice recent changes to analyst estimates for Apple. Such recent modifications usually signify the changing landscape of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional 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 last 30 days, the Zacks Consensus EPS estimate has moved 0.24% higher. As of now, Apple holds a Zacks Rank of #2 (Buy).

From a valuation perspective, Apple is currently exchanging hands at a Forward P/E ratio of 34.57. Its industry sports an average Forward P/E of 11.31, so one might conclude that Apple is trading at a premium comparatively.

It is also worth noting that AAPL currently has a PEG ratio of 2.77. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company’s anticipated earnings growth rate. The Computer – Mini computers was holding an average PEG ratio of 2.25 at yesterday’s closing price.

The Computer – Mini computers industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 20, placing it within the top 8% of over 250 industries.

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

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