Why Apple (AAPL) Dipped More Than Broader Market Today

Apple (AAPL) closed the most recent trading day at $319.97, moving -2.51% from the previous trading session. This change lagged the S&P 500's daily loss of 0.38%. At the same time, the Dow lost 0.51%, and the tech-heavy Nasdaq lost 0.29%.

Heading into today, shares of the maker of iPhones, iPads and other products had gained 5.06% over the past month, outpacing the Computer and Technology sector's gain of 2.81% and the S&P 500's gain of 2.08%.

The upcoming earnings release of Apple will be of great interest to investors. The company is expected to report EPS of $1.98, up 7.03% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $112.84 billion, up 10.12% from the prior-year quarter.

AAPL's full-year Zacks Consensus Estimates are calling for earnings of $8.85 per share and revenue of $477.42 billion. These results would represent year-over-year changes of +18.63% and +14.72%, respectively.

It is also important to note the recent changes to analyst estimates for Apple. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.01% lower. At present, Apple boasts a Zacks Rank of #3 (Hold).

In the context of valuation, Apple is at present trading with a Forward P/E ratio of 37.07. This signifies a premium in comparison to the average Forward P/E of 25.21 for its industry.

It is also worth noting that AAPL currently has a PEG ratio of 2.8. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. By the end of yesterday's trading, the Computer - Micro Computers industry had an average PEG ratio of 1.66.

The Computer - Micro Computers industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 45, this industry ranks in the top 19% of all industries, numbering over 250.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.

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This article originally published on Zacks Investment Research (zacks.com).

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