Los Altos, California - Crowd Technologies, Inc. provider of the stock research site Piqqem, today announced the sentiment results for Apple Computer (AAPL) going into their earnings announcement on Tuesday July 20, 2010. In a stunning turn of events, sentiment for Apple has dropped 15 points to the lowest level in the past 15 months.
The above chart shows Apple’s sentiment dropping by 15 points from the beginning of the quarter thru today. In comparison, sentiment for the Piqqem Technology Index rose 2 points in the same period, which means Apple’s decreasing sentiment was not strongly influenced by market forces. On the Piqqem scale, Apple’s sentiment rating of 34.60 is still considered positive and indicates a quality stock.
This drop in Apple’s sentiment is certainly a cause for concern. Apple has consistently been a top 3 rated company on Piqqem’s top rated list and now doesn’t appear in the top twenty-five. At its peak, Apple had a sentiment rating of 58 at the beginning of the year. Is there any rational for the drop?
In analyzing the sentiment line, I can identify 2 primary issues. On April 29 Steve Jobs wrote his open letter regarding the state of Flash from Apple’s perspective and this corresponded to a 7 point drop in Apple’s sentiment. On June 24, Apple released the iPhone 4 which received some bad reviews and this corresponded to another 5 point drop in sentiment. As of now, both of these events remain more of a PR issue and Apple’s briefing last week about the iPhone 4 should put the company back on track.
Analysts Still Love Apple
Average analyst estimates for the iMac and iPhone giant are $3.10/share in EPS and $14.74 billion in Revenue. 40 analysts track the stock with 15 upward EPS revisions in the last 30 days and no downward EPS revisions in the last 30 days. The 15 upward revisions is a real vote of confidence for the expected performance in the third quarter. Last quarter, Apple beat average analyst expectations by $.88 per share, $3.33/share vs. $2.45 per share. Apple’s share price also remains strong with Friday’s close of $249.90 being at 78% of its 52 week price range.
Apple’s Sector, Hardware & Networking, Remains Strong
Apple is also part of the Piqqem Technology Sentiment Index which tracks sentiment for 28 technology stocks in the Hardware & Networking, Software & Gaming, Internet & Mobile, and Semiconductor Sectors. Apple is part of the hardware and networking sector and it has shown growing strength and remains the strongest of the four technology sectors. So this is positive for Apple.
Previous Sentiment Results Ahead of Apple Earnings
| Quarter End | Release Date | Sentiment Before Release | Sentiment Trend in Quarter | Sentiment Indication | Earnings Result (EPS) |
| 31-Mar-09 | 21-Apr-09 | 33.56 | Neutral | Positive | Positive- 16.40% Upside |
| 30-Jun-09 | 21-Jul-09 | 44.50 | Rising | Positive | Positive - 71.80% Upside |
| 30-Sep-09 | 19-Oct-09 | 53.09 | Rising | Very Positive | Positive - 95.10% Upside |
| 31-Dec-09 | 25-Jan-10 | 49.69 | Neutral | Very Positive | Positive - 75.60% Upside |
| 31-Mar-10 | 20-Apr-10 | 50.10 | Neutral | Very Positive | Positive - 35.90% Upside |
| 30-Jun-10 | 20-Jul-10 | 34.60 | Falling | Neutral | ? |
Sentiment has proven to be a good indicator of upcoming earnings. In the above table, sentiment has remained positive to very positive in the previous 5 quarters for Apple. This positive sentiment has correctly forecasted the general earnings result. Last quarter sentiment for Apple predicted a great quarter and the company delivered a great quarter.
Q3 Earnings – What Does it All Mean
The financial analysts remain bullish on Apple and the stock price closed Friday in the upper 25% of its 52 price range. Apple’s recent product releases of the iPhone 4 and the iPad have had phenomenal success. But even with this momentum, something has changed. In the end, only Apple knows their actual results and current sentiment points to the iMac & iPhone giant delivering good results on Tuesday, but there may be clouds forming for the future – a future where Apple is no longer the darling underdog, but the 700 pound gorilla that everyone else is gunning for.
About Piqqem Sentiment
Piqqem uses a -100 to 100 scale and leverages the wisdom of crowds and its own proprietary algorithms to capture and calculate sentiment. Any sentiment rating above 25 is considered positive, below 0 is considered negative, while 0-25 is considered neutral. Changes in sentiment are also crucial in understanding and interpreting a company’s sentiment ahead of an event like earnings. Finally, market forces need to be considered to make sure overall market sentiment changes are not overly influencing a stock’s individual sentiment.
About the Author
Jett Winter is CEO of Crowd Technologies, Inc. a company that develops applications that leverage the wisdom of crowds. Their first major application is Piqqem which captures, processes, and presents sentiment data on the future price and price direction of publicly traded securities. Copyright (C) 2010 Crowd Technologies, Inc. All Rights Reserved. Apple, and the Apple logo are registered trademarks of Apple Inc. in the U.S. and/or other countries.
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Jett Winter
CEO
Crowd Technologies
650-619-9000
United States
jett@piqqem.com
Comments
Posted by Josh on July 19, 2010 at 6am
This is an incredibly stupid metric.
Posted by Oliver on July 19, 2010 at 6:12am
I will add your firm's name to those companies whose analysis and comments are worthless. Just wait till the earnings come out, and then wait another 3 to 12 months to see what the "sentiment" about Apple is. How do you guys stay in business?
Posted by Paul Whitmore on July 19, 2010 at 6:16am
Its easy for them to stay in business as their only overhead is their mom. They are in the basement she is upstairs.
Posted by Harry Magooslum on July 19, 2010 at 6:56am
About Piqqem Sentiment - "Piqqem uses a -100 to 100 scale and leverages the WISDOM OF CROWDS and its own proprietary algorithms to capture and calculate sentiment."
Ahhh, "wisdom in crowds". Now you see the flaw in this (sheep have little intelligence). I'd say that the index reports the overall effect of consumers ability to be influenced by the jackals called "the media".
Full disclosure: heavily invested in AAPL since early in this decade. Lucky me? No, it is better to be smart than lucky is my way of thought.
Posted by iPhoned on July 19, 2010 at 7:01am
Wow, I'm glad Crowd Tech wasn't around and people didn't trade on "Sentiment" twelve years ago after Steve came back.
AAPL wouldn't have gone from $4 to almost $300. *WHEW*
More B.S. Stock Manipulation from know-nothing, nobody geeks.
Where's the FTC?
Posted by Eric on July 19, 2010 at 7:36am
Good thing Piqqem is nonsense, or otherwise this report might mean something.
Posted by Pembina on July 19, 2010 at 7:55am
Looking at the stock's response, the sheep sold out. Got sheared, fleeced, skinned, ahh he!!, you get the idea.
Posted by steffenjobbs on July 19, 2010 at 10:50am
Apple stock doesn't need any report data help to drop. It's already fallen into the toilet today. Apple shares are so weak, it's pathetic. The slightest rumor can run this stock down $5 on any given day.
Posted by Nelson Montz on July 19, 2010 at 1:32pm
Glad sentiment is low. AAPL is near the 200-day moving average. Let 'em sell a tad more, and believe I will take a little ride tomorrow. It doesn't take analysts to speak for the "Mac Crew." Consumers tell all the story you need to know. Satisfaction! Luv my MacBook Pro. The jealous make something about NOTHING! If perfection counted- neither Verizon or Microsoft would be in business!
Posted by best. quarter. ever. on July 20, 2010 at 3:35pm
"Posted by steffenjobbs on July 19, 2010 at 10:50am
Apple stock doesn't need any report data help to drop. It's already fallen into the toilet today. Apple shares are so weak, it's pathetic. The slightest rumor can run this stock down $5 on any given day."
"Posted by Pembina on July 19, 2010 at 7:55am
Looking at the stock's response, the sheep sold out. Got sheared, fleeced, skinned, ahh he!!, you get the idea."
Perfect commentary.
Posted by Oliver on February 11, 2013 at 2:30pm
I'm sorry, he's