Financial market research and analysis

Apple

Apple has recorded 5 consecutive quarters of record revenues, but the last time the results were published Apple warned that the first iPhone sales decline was about to strike in 2016.

They also suggested that the expected revenue for the period would be between $50- 53 billion which represent a drop of 10% from the same period last year.

It might be also the first time that Apple will tell us about the Apple Watch sales results – this is unlikely to be bullish for the stock as anecdotal evidence would suggest that these have not gone all that well. The lack of functionality on the watch makes it merely something for the Apple fans to add to a collection and does not represent a game changer.

In the last two years China has been Apple’s major bet, where the company tried to grow, but the slowing of the Chinese economy, and the rising competition from rivals like Samsung, and also the almost saturated smartphone market might be considered among the cause for potentially disappointing results.
Apple’s stock plunged earlier this year on reports that sales of the company’s smartphones had gone relatively stagnant.

Of course the company might be about to reverse their fortunes – but the next  as soon as the next major iPhone model offered will need to stand apart if it is to compete with other companies– we await some details on this and may garner some news on it this evening.. Last month, Apple held a much-hyped unveiling for its latest update to the iPhone family, the iPhone 7 and that will go on sale later this year. Many doubt that this can spark any new sales growth.
The implied volatility on the Apple stock is around 4.5% which would imply a rise towards $110 or a deeper pull back to the $100 per share mark. Given that the fall in iPhone sales may have already been baked into the share price in the past quarter we cannot rule out upside volatility.

Analysts: Out of the 52 analysts 40 rate Apple stock a Buy, 9 rate the stock a Hold and 3 recommend a Sell. With a return potential of 30%, the stock’s consensus target price stands at $136.51.

Twitter

Twitter still has to find a better dimension in the social media market. Co-founder Jack Dorsey came back to lead the company last year and restructured the company with several employee and board changes. Some projects were also dropped in order to prioritize the more.
Disappointing results have so far ensued. The failure to add new users in the previous quarter, and even losing around 1 million active users at one point is just one example of a flailing product. Arguably the most important metric is monthly active user count – borne out by the 11% plunge in the share price after the company reported its user base had shrunk back in February.

Twitter's NFL deal is certainly a positive given the investment. While it may be a draw for some users to the platform, it still does not address the weakness in MAU and engagement. Twitter's stock has been trading below its IPO price for an extended period now and shows no signs of bouncing.

Twitter is also planning to move to China where it’s currently banned, but it appointed its first managing director for the country earlier this month.

Twitter’s stock is currently trading up about 6.2% since reporting fourth quarter earnings, compared to 9.9% for the entire S&P 500. Trading in a sideways range at the moment, the stock needs a catalyst to break from its reverie. The implied average volatility today is 14%  -which could imply an upside move close to $19 or conversely a retreat below $15 per share.

From the analysts: Twitter is trading at $17.24 and lots of rating firms seem to have a target price set on the stock. The median 12-month price target of 37 analysts covering the company is $19, which suggests the stock could still gain more than 10 percent. The highest analyst price target is $39, which implies a gain of 126 percent. And roundups of analyst notes show that 9 are rating the stock a buy while 5 rate TWTR a strong buy. There are 26 equity research firms suggesting a Hold and 2 consider it Sell.