Zacks upgrades Apple stock to ‘Strong Buy’

Zacks Equity Research has recently upgraded Apple stock to a Zacks Rank #1 (Strong Buy) which essentially reflects an upward trend in earnings estimates, one of the most powerful forces impacting stock prices.

Zacks Equity Research:

A company’s changing earnings picture is at the core of the Zacks rating. The system tracks the Zacks Consensus Estimate — the consensus measure of EPS estimates from the sell-side analysts covering the stock — for the current and following years.
The change in a company’s future earnings potential, as reflected in earnings estimate revisions, and the near-term price movement of its stock are proven to be strongly correlated. That’s partly because of the influence of institutional investors that use earnings and earnings estimates for calculating the fair value of a company’s shares. An increase or decrease in earnings estimates in their valuation models simply results in higher or lower fair value for a stock, and institutional investors typically buy or sell it. Their transaction of large amounts of shares then leads to price movement for the stock.
For Apple, rising earnings estimates and the consequent rating upgrade fundamentally mean an improvement in the company’s underlying business. And investors’ appreciation of this improving business trend should push the stock higher.

MacDailyNews Take: It’d be nice to see as Apple remains woefully undervalued currently!
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