Apple (AAPL) shares are already in a bear market, dropping from $130 a share last summer to $100 prior to Tuesday's fourth-quarter earnings report. Michael Parness, author of The Art of Trend Trading, said the technology giant's stock is headed back to 2011 levels -- around $45.
"We look at it as a hardware company, and if you base your view on that, then it's not that cheap," said Parness. "If you look back in history, you see Hewlett Packard and Compaq, and where are they now? Hardware companies don't hold these valuations."
Wall Street analysts forecast Apple to post revenue of $76.6 billion and earnings of $3.23 per share in the fourth quarter. Last year, Apple reported $74.6 billion in sales with per-share earnings of $3.06.
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Parness is also bearish on Oracle (ORCL) , which has seen its stock slide 2% year to date and 22% in the past year. Parness said he expects the entire S&P 500 (SPY) to fall due to a lack of growth prospects. In his view, Oracle has gotten most of its growth inorganically by rolling up other companies, so it is primed to fall even further.
"You are looking at a stock that technically is broken. It's in a bear market. And with the market the way it is, I think you have to be short the stock," said Parness.
Deutsche Bank (DB) is another troubled company Parness suggests shorting. The bank's shares have plummeted 42% in the past three months alone, and last week announced a record 2015 net loss of $7.26 billion. The stock recently traded above $18 per share, but Parness sees it heading to single-digit territory.
"They have the largest derivative book in the world as far as banks go, at $75 billion or so, and they are going to have to write down a lot of that because they are in emerging markets, commodities and China," said Parness.