Tech giant Apple Inc. (NASDAQ:AAPL) is on the move Friday breaking up and out of a two-month consolidation range to challenge highs seen in October. AAPL stock, like many big-cap tech stocks, had been left behind during the post-election Donald Trump rally as investors focused instead on financials, materials and industrials.
Click to Enlarge Some of this was driven by nervousness that Trump’s immigration policies could hit the H-1B skilled visas that many in Silicon Valley depend on for cheap programmers.
But now, with stocks continuing to push to record highs, investors are rounding back to laggards in search of value. As a result, the breakout in Apple stock could be just the start of a protracted new uptrend.
Better Charts, Headlines for AAPL Stock
The breakout takes Apple shares above both their 50-day moving average and their upper Bollinger Band — both indications that a powerful rally is underway.
As a reminder, shares have been under some pressure since the summer of 2015 as iPhone sales slowed amid saturation in the smartphone market and the company’s iPhone 6s and iPhone 7 updated garnered a lukewarm reception. Year-over-year sales declined for the first time ever.
But now, excitement is building for the new form factor iPhone 8 due next year. The Wall Street Journal has reported that a curved body is possible — the kind of major change that brought the company’s success with the larger screen iPhone 6 in 2014. Canaccord analysts note the company has established an installed iPhone base of 570 million users, much of which will drive future replacement sales and earnings.
The company will next report results on Jan. 24 after the close. Analysts are looking for earnings of $3.23 per share on revenues of $77.1 billion.
Edge Pro subscribers enjoyed 171% gain in their Nov $110 AAPL puts during the pre-election selloff.
Anthony Mirhaydari is founder of the Edge and Edge Pro investment advisory newsletters. Free two- and four-week trial offers have been extended to InvestorPlace readers.
