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Apple Overview
Apple Inc. AAPL closed the week at $335.22 on Friday, May 20, 2011 and was down -1.55% for the week, is down -4.26% for May, is up +3.92% for 2011, and is up +303.34% from the market cyclical low on March 9, 2009. AAPL set an all-time closing high of $363.13 on February 16, 2011 and is -7.69% below this peak.
Benchmark $348.48 Apple continues below the then all-time closing high of $348.48 of January 14, 2011 and has remained below for 8 consecutive trading days. This was after testing this benchmark price for 13 consecutive trading days. That all-time closing high was on a Friday and Apple Inc. announced the next Monday, January 17, that Co-Founder and CEO Steve Jobs was taking a medical leave of absence. We are watching this benchmark price of $348.48 as an indicator of buyer conviction and confidence in AAPL with Steve Jobs absent on medical leave.
S&P 500 By comparison, the overall market, the S&P 500, at 1333.27, was down -0.34% for the week, is down -2.22% for May, and is up +6.01% for 2011. SPX is up +97.07% since the March 9, 2009 market cyclical low. SPX closed at a multi-year closing high of 1363.61 on Friday, April 29, 2011, the highest close since the June 9, 2008 close of 1404.05, and is now -2.22% below that peak. AAPL is outperforming the overall market long-term since the March 9, 2009 market bottom, outperformed the market in 2010, and is now under-performing the market in 2011. A review of the S&P 500 is here [S&P 500 Continues Below 20-Day Average (Chart) *Down 3 consecutive weeks*].
Apple Fundamentals Apple reported near-record calendar Q1 2011 financial results on Wednesday, April 20. This was after Apple reported calendar Q4 2010 financial results on Tuesday, January 18 which were a record and legendary. Calendar Q1 is historically the weakest quarter for Apple. These financial results are reviewed and analyzed on this blog.. Current Apple financial data, charts, and review is at the Apple Financial Performance page, updated for the latest calendar Q1 2011 results reported on April 20. A review and analysis of the Q1 2011 earnings call has been posted at the Apple Earnings Conference Call page. Our updated valuation and target price of AAPL stock is posted at the Apple Stock Valuation page. International sales accounted for 59% of revenues for Q1 2011, down from 62% in Q4 2010 and up from 52% in Q3 2010.
Apple Product News 2011 A summary & review of 2011 & 2010 major announcements are posted on this blog.
Apple Fundamentals Apple reported near-record calendar Q1 2011 financial results on Wednesday, April 20. This was after Apple reported calendar Q4 2010 financial results on Tuesday, January 18 which were a record and legendary. Calendar Q1 is historically the weakest quarter for Apple. These financial results are reviewed and analyzed on this blog.. Current Apple financial data, charts, and review is at the Apple Financial Performance page, updated for the latest calendar Q1 2011 results reported on April 20. A review and analysis of the Q1 2011 earnings call has been posted at the Apple Earnings Conference Call page. Our updated valuation and target price of AAPL stock is posted at the Apple Stock Valuation page. International sales accounted for 59% of revenues for Q1 2011, down from 62% in Q4 2010 and up from 52% in Q3 2010.
Apple Product News 2011 A summary & review of 2011 & 2010 major announcements are posted on this blog.
Economic and Market News Information about the USA and world economies plus the USA financial system are posted at Boom Doom Economy, Financial Controls, and Baidu Planet. Additional current commentary on both the overall stock market and economy is posted at Matrix Markets.
Apple Daily Chart
Apple Daily Chart Below is the AAPL daily chart since January 3, 2011 to illustrate recent price interactions.
Noteworthy Closing Prices
Current Close: $335.22
2011 and All-Time High: February 16 $363.13
2011 Low: January 21 $326.72
2010 High: December 28 $325.47
2010 Low: February 4 $192.05
YE December 31, 2010: $322.56
YE December 31, 2009: $210.73
Cyclical Low: January 20, 2009 $78.20
Apple Chart Review
Intermediate Term Trend slightly ascending 25d sma less than descending 50d sma, neutral/bearish
Long Term Trend AAPL greater than 10 month ema = 318.27, bullish since April 2009
Key Resistance 50d avg 342, 100d avg 344, 20d avg 345, benchmark 348.48, benchmark 350
Key Support 330s in general, recent closing low 327, 325
Moving Averages below 20d, 50d, 100d avgs, above 200d avg
Uptrend Line closed above since 9-2-10, pinned through 4-18-11 and 5-17-11; line from 1-20-09 closing low 78.20 up thru 2-4-10 192.05
Downtrend Line below, been testing since 4-21-11; line from 2-16-11 all-time closing high 363.13 to 3-4-11 peak 360.00
RSI 14 Day = 35.32 is oversold, descending
RSI 28 Day = 52.44 is reasonable, descending
MACD (12,26,9) = -1.27, continues descending
Volume low 12.1M latest day, 50 day avg = 15.5M
Price Earnings Ratio (ttm) very low 15.98, historically in low 20s
Conclusion An explosion at a Foxconn plant in Chengdu, China which produces the iPad 2 sparked a sell off and dip by AAPL on Friday, May 20. The extent of the manufacturing disruption is unknown. There already has been concern the demand for iPad 2 is much greater than Apple's production abilities. Cirrus Logic earlier reported production problems with an audio device and 50% of its business is supplying components to Apple. Components of the iPad 2 (at least five) from Japanese suppliers may be delayed due to the March earthquake. Overall there are no serious concerns about Apple except for the component supply issues regarding iPad 2. The fundamentals of Apple continue amazingly strong with Q1 2011 near-record total revenues and earnings per share, total assets of $94.9 billion, and cash and investment reserves of $65+ billion. The remainder of 2011 looks positive for Apple, with Q2 outperforming Q1, Q3 outperforming Q2, and the holiday Q4 quarter setting another peak. Total assets should exceed $100 billion this calendar quarter, Q2 2011. Quarterly total revenues should reach $30 billion by Q4 2011. The fundamentals of Apple Inc. have been stellar, as discussed above and reviewed on this blog. Our AAPL target price short-term remains $370 - 375. The intermediate-term trend indicator continues neutral/bearish and the long-term trend continues bullish.
Disclosure We are long AAPL.
About Apple Inc.
Apple Inc. achieved a milestone the week of January 7, 2011 when total market capitalization surpassed $300 billion. Previously, the week of May 24, 2010, Apple surpassed Microsoft in market capitalization to become the largest technology company, and second overall largest company, in the USA. Apple Inc. has managed to continue above $300B market capitalization after the announcement of Steve Jobs' medical leave of absence. AAPL's market capitalization is #2 at $310.00 billion, compared to #4 Microsoft's of $206.52 billion. #1 Exxon leads with $401.82 billion (Exxon surpassed $400 billion in market capitalization for the first time the week ending February 4, 2011). Apple reported calendar Q1 2011 total revenues of $24.67 billion and net income of $5.99 billion. Microsoft reported calendar Q1 2011 total revenues of $16.43 billion and net income of $5.71 billion. Current Apple financial data is at the Apple Financial Performance page. Current Microsoft financial data is at the Microsoft Financial Performance page. Apple is now 11.90% of the NASDAQ 100 index, as measured by the PowerShares QQQQ ETF portfolio holdings, weighted by market capitalization, but rebalanced effective May 2, 2011. AAPL is one of the most traded stocks in the USA. Per the SEC Form 10-K, Apple had 46,600 full-time employees and 2,800 temporary full-time employees and contractors as of September 25, 2010.
Apple's Mission Statement and as described in press releases, "Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork, and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple reinvented the mobile phone with its revolutionary iPhone and App Store, and has recently introduced its magical iPad which is defining the future of mobile media and computing devices."
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