Another Day, Another All-Time High for Apple
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The comment section of the Barron’s report where that information was published, if you can believe it.
Some people were extremely bullish or being overly bullish with a sense of humor… some were cautiously conservative… and some were downright bearish.
Because the predictions of what will come next for Apple ranged from:
- The stock price trading for $400 in the next 12 months.
- The stock price trading sideways or slightly down and hitting $185.
- The stock price tanking as much as 15% by the end of July.
But aside from entertainment… they also can serve as a tool to help you spot winners and avoid adding potential losers to your portfolio… so long as the prediction is more than just a “guesstimate.”
Within TradeSmith, there exists such a tool.
With incredible computing power and AI at our fingertips, the TradeSmith team embarked on the most important research project in our company’s history… one designed to ramp up your gains on stocks — while slashing the potential for risk and mistakes.
We call this incredible system An-E, which provides price predictions in our suite of Predictive Alpha services.
And because Apple just notched this new all-time high, I thought it was the perfect time to deploy An-E to see what was next in the month ahead for Apple.
Plus, we’ll also use some of our other investing tools to paint as detailed of a picture as possible of what to make of Apple as an investment in this moment.
Apple Under the TradeSmith Microscope
The Apple culture of “people not knowing what they want until you show it to them” remains strong, with the Apple Vision Pro headset hitting shelves in early 2024.If any company can make you want a $3,500 headset that blends the virtual, augmented, and real world, it will be Apple.
And in terms of how the company operates, we can assign a quantifiable number through our Business Quality Score.
It rates every company based on a composite of four broad quality metrics:
✅ Growth: This metric measures changes in a company’s finances such as sales, profit, return on equity (ROE), return on assets (ROA), and cash flow over the past five years.
✅ Profitability: This metric measures a company’s current level of profitability relative to its assets, sales, and shareholder equity.
✅ Safety: This metric measures a company’s financial strength (debt burden, credit risk, etc.) and its stock’s historical volatility versus the overall market.
✅ Payout: This metric measures how much of what a company earns benefits shareholders via dividends, net share buybacks, and debt repayment.
✅ Profitability: This metric measures a company’s current level of profitability relative to its assets, sales, and shareholder equity.
✅ Safety: This metric measures a company’s financial strength (debt burden, credit risk, etc.) and its stock’s historical volatility versus the overall market.
✅ Payout: This metric measures how much of what a company earns benefits shareholders via dividends, net share buybacks, and debt repayment.
Our algorithms first calculate the current quality score for each stock compared to its history and all other stocks in our database. They then average those scores for each stock and rate the stock on a quality scale from 0 (lowest quality) to 100 (highest quality).
With a score of 99, Apple operates a stellar business.
That isn’t a surprise — the company has consistently rewarded long-term shareholders for nearly the last 20 years because of its execution of creating products people love:
But with a short-term outlook, now may not be the best time to start a position or add to a current position in Apple.
Our Health Indicator is designed to let you know immediately if a company is in a healthy and investable state, and Apple is currently in our Red Zone — marking it as a stock to stay away from.
We can also turn to our AI-powered stock picker for expectations of where Apple could trade over the next month (please note that An-E is always analyzing data and this information is of the time of this writing).
When Apple hit its latest all-time high, An-E did not see much upside ahead.
It gave Apple a “Neutral” rating, with a price prediction of $188.45 by July 26:
Putting everything together, Apple runs an incredible business and is an expert at showing people “what they want.”
With a long-term outlook, it’s hard to find a company that could reward a shareholder as much as Apple.
But when a stock price is hitting all-time high after all-time high, with a short-term outlook, it’s good to take a step back and put a critical set of eyes on the situation. From its status in the Red Zone to An-E’s price prediction, everything shows this may not be the time to start a new position in Apple.
Armed with that information, if you have been feeling a twinge of FOMO (fear of missing out), our tools can help you keep that feeling in check and not act on it.