From the Wall Street Journal’s “Stock Futures Wobble Ahead of Coca-Cola, McDonald’s Earnings” posted early Wednesday:
Stocks were poised to waver around record highs as investors awaited results from more of the biggest U.S. companies…
Solid quarterly earnings from American corporations have quelled the investor concerns about supply-chain problems, inflation and Chinese economic growth that rattled markets at the start of fall. The S&P 500 is up 6.2% for October and on course for its biggest monthly advance since November.
“Investors got fairly gloomy in September, clearly against the backdrop of all sorts of macro concerns,” said Paul O’Connor, head of the multiasset team at Janus Henderson Investors. “The broader story from results is that companies are managing these dynamics pretty well, and also managing expectations fairly well.”
Money managers still have worries, ranging from the fate of President Biden’s infrastructure and social-spending plans to the potential unwind of Federal Reserve stimulus measures that have goosed markets since early 2020. For now, though, many investors say they are sticking with stocks in the expectation of modest if bumpy returns through the end of the year.
Patterns: Engulfing line (bearish) spotted. Max pain has moved to $147, up from $146 yesterday.
But don’t be fooled! Apple has two things going for it: It gets to continue to buy back cheap stock, and, contrary to the opinions in the peanut gallery, it’s far from done growing.
Add those two facts together and the future looks as bright as ever for Apple longs.
aapl eps 2021 = 5,7
p/e = 29
value = 165
p/e = 40
value = 228
apple looks really cheap at the moment.
“with a multiple of 29 apple looks undervalued compared to microsofts 40.”
If you think AAPL’s multiple is low now just wait until Friday!
AAPL is flat to down and its volume is pitifully low. When’s the last time this happened this close to earnings?
Apple’s revenue and earnings are going to be great, but investors don’t care. There may be a little surge but by Friday the P/E will have contracted due to the huge EPS gain compared to a year ago.
Investors, like folks generally, are just not that smart. They’ll see MSFT at 40 and AAPL in the 20’s and be convinced something is wrong with Apple….
Like I said, we’ve seen this movie before, and more than once.