The market’s been reaching all-time highs as of late, and many stocks are performing better than expected. Today’s trade, Apple Inc. (AAPL), is looking strong in the long term and is perfect for a bullish market.
2014 is looking to be a solid year for the tech giant. After a shaky 2013, AAPL has been rallying and the company released a Q2 report that pleasantly surprised analysts and included a revenue increase of 4.7% quarter-over-quarter. Although there are still risks in this market, AAPL stock has been outshining the rest and has a solid core of fundamental and technical data.
Fundamental and Technical Analysis
In my Turner Analytics ratings, Apple scores as a Buy on the fundamental side, with a score of 48 out of 100, and as a Strong Buy for technical ratings, with a score of 87 out of 100.
As the market is favoring the bulls, it’s a good sign for those looking to invest in Apple; the time-cycle forecast for the company is also bullish for the next 90 days, and the expected move is $40.90, or a 6.5% move off the Friday close of $633. Take a look at the Turner Analytics chart below to see the trajectory for Apple.
I will also advise you to stay conservative with Apple, because the stock volatility is high. Remember, this doesn’t necessarily mean that you should not go in; it just means that there is high risk and also the potential for high pay-off.
Historical Acquisition and Stock Split
On top of all the technical and fundamental signals, Apple has also been making headlines for acquiring Beats Music and Beats Electronics. Apple finalized a deal with Beats in which it will buy the company for $3 billion, a historical acquisition; the agreement was for $2.6 billion in cash and $400 million in stock options. This positions Apple to compete in the Android market with the Beats Music app as well as branching out further into music streaming. After the announcement, AAPL shares rose less than 1% at the following market open.
Apple also recently reached another milestone: the stock price surpassed $600 per share for the first time since October 2012. The company is also scheduled for 7-for-1 split on June 9, potentially making Apple eligible to join the Dow Jones Industrial Average (DJIA). Overall, this is a very strong trade with a combined technical and fundamental ranking of 135. I recommend entering this trade at $622.00 and setting a protective stop at $565.22.
Mike Turner is an engineer turned entrepreneur with more than 20 years’ experience in systems development and enterprise-level software applications and 15+ years in finance and stock market strategies. He is the founder of Signal Investor and Turner Analytics.
Mike’s background in finance, computer science and engineering provide a solid foundation for Signal Investor’s rule based trading approach. Turner Analytics provide members with access to the software Mike created and uses to make his stock, option and trading recommendations. Click here to get Mike’s unique take on stocks through technical and fundamental analysis.