By Thursday's all-time high close, most Apple analysts had caught the market's drift.
Below: My full list of Apple price targets—now with gap between target and closing price—as accurate and up-to-date* as I can make it. Corrections appreciated.
Click to enlarge. *I rely on TipRanks ($) for the estimates of an analyst who shall remain nameless (long story).
Note on methodology: The average price target jumped when Street-low Jun Zhang left Rosenblatt Securities. It jumped again when I trimmed four analysts I hadn't heard from in more than three months. (Oh Steve Milunovich, Eric Ross, Louis Miscioscia and Erwan Rambourg, where art thou now?)
Finally, courtesy of AAPLInvestors‘ Terry Gregory, the top 30 all-time high closing prices. Dates in green indicate that the closing price was an all-time high the day it was posted.
Sometime last night the Calls sold short were Called away from me. My positions showed my short shares with an astronomical negative value. Selling my long Calls wouldn’t generate the funds necessary to cover the negative value of the short shares. It looked like I was going to have to come up with several tens of millions of dollars to fix this.
I got on the phone with Schwab right away. They did an excellent job of calming me down. They showed how to set up a buy/write order, and also explained that as long as AAPL was trading above $315 (highest top leg strike) I’d be fine letting these go to expiry.
In 15 plus years I have never seen one of my Call Spreads pulled apart like this. The unknown can be scary.
What scared me was that I saw a negative Market Value of several million dollars. Once I saw that I stopped looking at my positions page, had I continued looking I would have seen that several million dollars (enough to cover the negative Market Value) had been deposited in my account.
Lesson learned (happily).
The shares were called away at three different Strikes within seconds of each other. I’m thinking a single investor had bought a whole lot of Calls, over a range of Strikes, and wanted the shares (not the Options profits). What does that person know?
Yikes.
Of the 36 analysts, I keep records on:
* 17 have price targets that were published on January 29 (the day after earnings). It appears these analysts are doing as I and using Luca’s Guidance as to the basis for their targets, though their Investor Sentiment Multiples vary wildly.
* 3 have price targets that are over 130 days old and carry a $204 consensus. My guess is that these analysts are no longer covering Apple.
* 14 have price targets I have grouped as being for May 2020. Their consensus target is $351 with a standard deviation range of $343 – $358.
* 9 have price targets I have grouped as being for August 2020. Their consensus target is $375 with a standard deviation range of $364 – $375.
* The May and August targets align with my own target forecasts using an Investor Sentiment Multiple of 27. Keep in mind that my January target had a range of $285 – $295. Long term accuracy is not a strong suit of mine.
Not to mention, the massive jumps in target prices from notabears, notable bears, Pierre Ferragu and Rod Hall.