Apple stock may have further to fall before it’s considered a bargain

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AAPL may not be the best investment right now.
Photo: Laurenz Heymann/Unsplash

Apple shares, like the broader stock market, are taking a coronavirus-induced plunge. But when is the right time to buy in order to secure yourself a bargain?

Not right now, claim analysts who spoke with CNBC. Although AAPL is currently down around $70 from its February high of $327.20, analysts think there’s further for it to fall.

“The next big area of support comes into play on this stock about another 10-12% lower from where we are right now, which would get you to about a 20-25% kind of peak-to-trough correction in the stock,” Craig Johnson, senior technical research analyst at Piper Sandler, told CNBC Wednesday.

A 12% decline in Apple would bring the stock down to around $242. Johnson said that, while he believes there’s “no question Apple is a great company,” right now it’s not such a good stock.

Apple stock: Sell, sell, sell?

Nancy Tengler, chief investment officer at Laffer Tengler Investments, told CNBC that AAPL isn’t a good proposition until it declines a bit further. “We’ve been selling prior to this when all the analysts were upgrading and raising their price targets on the stock,” Tengler told CNBC. “I need for it to come back a little bit further to be adding to it.”

Bernstein analyst Tony Sacconaghi meanwhile said that Apple is one of the “most exposed companies” to a potential worldwide recession.

While all of that might sound like a downer, though, both Johnson and Tengler say that Apple has a lot going in its favor. The question isn’t so much whether Apple is a company with some fundamentally great selling points (it is!), but whether it’s going to dip even further before beginning its climb back to the top.

Despite the recent negativity, Apple has enjoyed a great year so far. Its shares have climbed 54% in 2020 alone. That’s way over the S&P 500 average, which is down 2%.

Source: CNBC