In midday trading Monday, Apple shares fell through a key support level, cutting below its 50-day moving average price line. Apple stock was down more than 1%, near 565. Shares had been down as much as 2.9% earlier in the day.
Apple stock fell eight out of the previous nine trading days. The stock hit an all-time high of 644 on April 10.
As Apple announces its 2012 second fiscal quarter earnings on Tuesday, some analysts think the stock price could hit $1,000 and the company reach $1 trillion in market capitalization. I have no idea where Apple's price is going or what's in its secretive product pipeline, but I suspect that even with strong recent earnings, it will eventually fall from the tree it's on now.
Apple Inc. (NASDAQ:AAPL) shares are rebounding slightly and was recently up 0.42% at $575.39, well above its intra-day low of $556.62. The stock has been under selling pressure ever since it made an all-time high of $644 on April 10, 2012. The stock lost almost $88 or 13.50% after today’s intraday low.
The recent fall was largely followed a hefty gain throughout this year as the stock had jumped over about 60% for this year before the correction started. Moreover, the recent fall could better be describe as pre-earnings sell off as the company is slated to report its earnings on tomorrow after the closing bell.
There are strong expectations from the iPhone maker, with analysts are estimating the company to report a profit of $9.89 a share, up from its year ago profit of $6.40 a share. Revenue is estimated to grow by 47% to $36.27 billion, from $24.67 billion a year ago. The company guided $8.50 EPS on $32.50 in revenue.
Last week, analyst at Canaccord Genuity slashed his FQ3 and FQ4 estimate for iPhone with fiscal Q3 sales of iPhone at 29.34 million units and 26.11 million units in Q4, well below its previous forecast of 33.58 million and 33.58 million respectively.
Analysts polled by Thomson Reuters expect Apple to earn $10.02 a share, up 57% from the year-earlier quarter, on sales of $36.69 billion, up 49%, for the March quarter. For the current quarter, analysts are forecasting Apple to earn $9.91 a share, up 27%, on sales of $37.34 billion, up 31%.
However, despite the recent correction, the stock is still up over 41.50% so far this year and the recent rally made Apple Inc., the world’s largest company by market value.
Mid March, the company introduced a much awaited third and the upgraded version of the iPad. Following the announcement of this new launch, several analysts raised their price target on the stock with a couple of brokerage firms setting the price target of over $700, reflecting a potential gain of at least 17% from the current price.
Also, the company announced a quarterly dividend of $2.65/share to begin in FQ4 of this year (July 2012) as well as a buyback program of up to $10 billion.
It would be interesting to see if the company’s earnings would impress its investors once again and the stock would be able to rebound after the recent correction.
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