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TheStreet Open House

Time to Double-Dip Apple Shares

NEW YORK ( TheStreet) -- Wall Street analysts remain cautious on Apple (AAPL) and have lowered price targets. For example, Goldman Sachs (GS) recently picked Apple off its prestigious "Conviction Buy List" and lowered the stock's price target to $575 from $660. At ValuEngine, Apple has maintained its buy rating and remains one of the best value plays in the stock market today.

Wall Street prefers Google (GOOG) and there are many articles on the Internet that try to justify a $1,000 price target for this stock. At ValuEngine we disagree, as Google remains hold rated with the stock extremely overvalued.

Meanwhile, Amazon (AMZN) remains sell rated according to ValuEngine, but the stock remains above its 200-day simple moving average (SMA) at $248.69.


Apple remains the best Value Stock: Traders and buy-and-trade investors could have bought Apple at my annual value level at $421.05 on March 3/4 and the stock rebounded to $469.95 into March 25, providing a gain of more than 10%. This rebound approached my semiannual pivot at $470.21. Last Friday was an opportunity to double-dip at the $421.05 annual pivot.

Chart Courtesy of Thomson / Reuters

Apple still has a buy rating with fair value at $555.64, which makes the stock 23.2% undervalued in the computer & technology sector which is 9.0% overvalued. Apple has a 12 month trailing P/E of 10.11, and a 12 month forward P/E of 9.07. The weekly chart profile remains oversold and if the stock breaks below $419.00 the risk is to this week's value level at $406.75 with the 200-week simple moving average (SMA) at $371.43. For Apple to swing back to mojo status, the stock needs a weekly close above the five-week modified moving average (MMA) at $445.10.


Sustaining $800 has been a problem for Google: After setting a record high at $844.00 on March 6, Google briefly dipped below $800 on March 28 with a low that day at $793.30. On April 1 the stock dipped slightly lower, but by the close was back above $800. On April 2, the stock failed below its 21-day SMA at $817.51 and on April 5 was below its 50-day SMA at $797.21 and on Monday Google traded as low as $768.40. It appears that as soon as Wall Street raised targets, the stock made a u-turn and could not hold $800.

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