This week's Apple trading strategies (5/23-5/27/22)

A place for Apple traders and investors to share their best ideas.

To get things started, here's Wedbush's Daniel Ives on CNBC during Friday's roller coaster market ride predicting that within 9 months the stock will "have a 2 in front of it."

Below: Apple vs. the S&P 500 last week, normalized…Disclosure: Although I am now an Apple shareholder (see Why I bought a share of Apple, my first), I am in no position to give trading advice. Don’t blame me if you drain your IRA doing something you read about here.

apple trading strategies 5-23-22
See also last week’s trading strategies.

9 Comments

  1. Robert Paul Leitao said:
    Apple fall to $125? It could happen, but I’ll be competing with every smart investor around town (and probably with Scrooge McDuck) for U-Haul reservations. Those moving trucks are advertised to have lower ramps for cargo and we’ll all be schlepping shares up the ramps on the way to safe storage. Every mom, dad, aunt, uncle, nephew, niece, sister, brother, and son & daughter over the age of seven will be put to work. I’ll be clearing out the LA Zoo of their collection of beasts of burden to help with moving the shares. It’ll go down in history as the Madness and Mayhem Moment in America.

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    May 22, 2022
    • Bob Goldstein said:
      I’m not buying at any price but I would be fine with the share price dropping and staying in the $120’s until Apple spends the $105 billion allocated for buybacks. I am thinking of what that would mean for future dividends. I’m all for a $200 + price share but as I don’t sell I am more interested in much higher dividends with $105 billion worth of shares removed at a bargain basement price

      1
      May 22, 2022
      • Robert Paul Leitao said:
        Bob: As I read more and more commentary and analysis, dividends are increasingly coming into the forefront of conversations. Investors are learning ETFs have their benefits, but they aren’t necessarily a safeguard against broad market pullbacks. There’s lots of discussions today on various retirement strategies and current income flows do provide an income stream when share prices head south and, for all investors, a steady stream of receipts available to deploy for opportunistic purchases at very attractive long-term prices. I’ve long believed share repurchases would deliver higher dividends per remaining share sometime “down the road.” We’ve been ten years on this road now, in the range of 40% of the fully diluted share count has been removed from the market, and it’s time as interest rates rise to offer shareholders a higher dividend per share. A higher dividend is apt to keep more investors in the shares long-term while inviting new investors to the party. Buybacks are good. But buybacks, as we are seeing now, also don’t offer as much downside protection as we would like. Buybacks are good. Buybacks plus an ample dividend are an excellent combination.

        1
        May 22, 2022
        • Bob Goldstein said:
          Robert, I know buybacks creating downside protection have been mentioned so many times in comments in this board and in Braeburn Forum. It was a selling point on the forums from day one of buybacks and I have yet to see it.
          I may be wrong but I see that with a 40% share reduction, and possibly more if the S/P remains low for the year, of much higher dividends when Apple decides it is time to change the ratio. One share less that Apple pays out means more money available to state the obvious.
          Share price now does not concern me, I would be very happy if they can use the $105 billion while shares are dirt cheap
          I do have some worries though about what happens when the buybacks are drastically reduced. Will the share price go down without the buybacks propping up EPS?

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          May 22, 2022
          • Robert Paul Leitao said:
            Bob: Buybacks “amplify” the impact of rising net income on earnings per share. In my view, the value of repurchases is directly tied to net income growth. I wouldn’t be concerned about the need for buybacks to prop up eps. I’d be focused more on the pace of net income growth to drive the share price higher. In other words, repurchases are like an “after burner” to push the share price into a higher “orbit” while net income growth is the “primary thrust” that first propels the share price into “space.” In my view, net income growth and anticipated net income growth are the primary drivers of Apple’s share price appreciation. I’m more concerned about the pace of net income growth than the pace of share repurchases. Besides, repurchases will continues for the foreseeable future. Of course, this is just my view.

            1
            May 22, 2022
  2. Michael Goldfeder said:
    I firmly believe that when Warren was buying shares at $150 before it jumped up to the $165 level, that he must now be giddy with the stock in the $135 range. After all, it was Warren who came out and said a long time ago: “Be greedy when others are fearful!” Apple is following that same formula with $180 Billion in buybacks the last two years alone. As Dan Ives said: “Nine months from now this stock will have a “2” in front of it!

    I’m certain that wasn’t a reference to the company with the largest market cap nine months from now!

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    May 22, 2022
  3. David Drinkwater said:
    I’m just gonna say that is sucks (a lot, and without further detail) to be 99% invested after these last 6 weeks.

    I know I’ve just got to ride it out, but it is pretty unpleasant.

    It would b really neat to have cash on hand, but as an investor, rather than a trader .. it is what it is.

    And if I had free cash, I think that WWDC 2022 would be a great place to anticipate (wait for or plan around).

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    May 23, 2022

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