Here’s Why Apple Investors are Moving to iSell Mode

January 24, 2013

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E = Equity to Debt Ratio Is Strong

The debt-to-equity ratio and balance sheet for Apple are perfect. That’s a rarity.

	Debt-To-Equity	Cash	Long-Term Debt
AAPL	0.00	$29.13 Billion	$0
GOOG	0.09	$45.72 Billion	$2.99 Billion
RIMM	0.00	$2.73 Billion	$0

T = Technicals on the Stock Chart Are Weakening

Apple has had an amazing performance over the past three years. It has outperformed Google (NASDAQ:GOOG) by a wide margin. It has also outperformed Research In Motion Limited (NASDAQ:RIMM), but that should be expected. That said, one of the biggest scares for Apple investors should be the breakdown on the technical side. Many traders rely heavily on technical indicators, and Apple is now looking bearish. It’s a classic fight between TA and fundamentals. In most cases, TA will win for the short to medium term, and fundamentals will win out in the end.

	1 Month	Year-To-Date	1 Year	3 Year
AAPL	-6.52%	-8.78%	14.59%	147.70%
GOOG	3.61%	4.82%	26.63%	34.81%
RIMM	61.78%	48.69%	13.43%	-71.38%

At $461.90, Apple is currently trading below all its averages.

50-Day SMA	536.46
100-Day SMA	593.54
200-Day SMA	593.83

E = Earnings Have Been Phenomenal

If you want to look at a near-perfect picture for earnings and revenue growth on an annual basis, then look at Apple.

	2008	2009	2010	2011	2012
Revenue ($)in billions	37.49	42.90	65.22	108.25	156.51
Diluted EPS ($)	6.78	9.08	15.15	27.68	44.15

We already know what happened this quarter. Now let’s take a look at previous quarters.

	9/2011	12/2011	3/2012	6/2012	9/2012
Revenue ($)in billions	28.27	46.33	39.19	35.02	35.97
Diluted EPS ($)	7.06	13.87	12.30	9.32	8.66

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