Apple (AAPL) is scheduled to release Q1 earnings this Monday January 25th, after the market close.
Average analyst estimates for the Mac and iPhone maker are $2.07/share in EPS and $12.05 billion in Revenue. Thirty-eight analysts track the stock with fifteen upward EPS revisions in the last 30 days and no downward EPS revisions in the last 30 days.
Last quarter, Apple beat average analysts expectations by .40/share or 28.2%, 1.82/share vs. 1.42/share.
I always find this a tough period waiting to see if the company is going meet, exceed, or miss their earnings estimates. One thing I have discovered of value is to analyze sentiment moves in a stock ahead of the company’s earnings release. In the case of Apple, I will use the piqqem sentiment index for Apple to see how sentiment has changed in the last quarter, for the months within that quarter, and from the end of the reporting quarter thru today.
I’m looking for moves or changes that may foreshadow the earning release. (piqqem leverages the ‘wisdom of crowds’ by allowing its users to vote on the price direction of a stock and then applies its own propriety factors to calculate sentiment for a security. In their model, -100 is the lowest and 100 is the highest sentiment).
Sentiment for Apple
Source Piqqem
The above chart shows Apple’s sentiment peaking on November 30, 2009 and then dropping a modest 10 pts thru today. Apple remains the number one stock on Piqqem’s Top Rated List and I interpret the recent sentiment drop to overall markets conditions and Apple’s current lofty price. For example, sentiment for the S&P has dropped by over 10 pts from 23 on November 30, 2009 to 12.5 today. The chart also shows an 8 pt decrease in sentiment for Apple from the end of Q1 thru today. This last indicator has historically been the most accurate indicator regarding an earnings surprise, both upside and downside, although I attribute the downward movement more to market conditions and less directly to Apple. On the Piqqem scale, Apple’s sentiment rating of 49.69 is considered a buy and absolute sentiment indicates a very high quality stock. Only Apple knows their actual results, but their current sentiment points to Apple beating estimated earnings on Monday.
Comments
Posted by whatajoke on January 22, 2010 at 10:50am
If sentiment was so strong, why would the stock be so weak?
Posted by LI Chueng on January 22, 2010 at 6:02pm
Corporate investors gaming the market again, just like last time: http://www.benzinga.com/96963/apple-q1-2010-earnings-due-monday-–-“don’t-get-punked-ii”