Strong iPhone Demand Can’t Help Apple Stock (AAPL)

It’s that time of year again.

aapl-apple-stock-splitWhile many associate September with the beginnings of school or fall or football season, another notable event should be marked on your calendar: The annual Apple (AAPL) event, during which the latest Apple iPhone is expected to be revealed. 

With the event less than a week away, predictions are cropping up quicker than a pundit can say “Apple TV.” And investors in AAPL are unsure of the right response to it all, desperately searching for a signal within the noise.

This morning, for instance, the new CEO of Japan Display, Mitsuru Homma, referenced strong demand from its “biggest client,” foreshadowing strong iPhone orders pre-launch. This originally sent shares higher, and should, in theory, be bullish for Apple stock.

Homma told Reuters:

“They’re coming to us with more orders, saying ‘give us more, give us more’. They keep increasing,”

Since the original bump on the news, though, shares of Apple stock have reversed and AAPL is in the red as of this writing. This is perhaps because the CEO’s optimism was in a way just more reassurance that the Chinese smartphone market isn’t going to weigh on Apple stock — reassurance investors already got last week in an unprecedented note from Tim Cook:

“I get updates on our performance in China every day, including this morning, and I can tell you that we have continued to experience strong growth for our business in China through July and August.”

The reaction was similar then, though, with AAPL stock originally rallying on the news before investors decided it wasn’t that great and headed for the exit again. Apple closed down almost 3% that day.

That indecisiveness — aside from being part of the broader market vibe — could also come from the fact that there is already so much noise around next week’s event … and it’s only bound to get louder.

Just a super quick sample shows Fortune recently suggesting that the reveal of the latest device (which will be either the iPhone 6s or iPhone 7) should offer some relief for investors, and has MarketWatch eyeing a new and improved Apple TV and perhaps even a larger iPad.

Put another way, this is just another headline for the pile.

One thing’s for sure, though, Apple stock could indeed use some release. AAPL hit a high just over $132 in July, but fell along with the broader market in the months to come. Up until last week’s upward momentum, shares were actually sitting in the black year-to-date.

AAPL stock has moved 38 basis points higher since the year started, remaining below both short- and long-term moving averages. On the upside, that puts Apple stock at a price just 11 times its expected 2016 earnings — not too shabby compared to the 14% long-term growth on tap, or the fact that the broader market is sporting prices 20 times earnings.

But between Thursday’s “good news” from Japan Display, the apparent gains for AAPL stock and subsequent reversal, show that the company — despite being a good value — has a lot of work to do before investors pile in again.

Alyssa Oursler is based in San Francisco and writes about technology, investing, gender and entrepreneurship. Her work has appeared on Forbes, Business Insider, MSN Money and more. You can follow her on Twitter here or check out her personal site hereAs of this writing, she was long AAPL.

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