Why Apple Stock Bounced Higher Today


What happened

After suffering a bad case on Mondays yesterday, like pretty much every growth stock on Earth, stocks of Apple (NASDAQ: AAPL) rebounded on Tuesday, rising to 2.2% and ending the day up 1.4%.

You can thank Wall Street for that.

Image source: Getty Images.

So what

In separate reports, investment banks Piper sandler and Bank of America gave two reasons for investors to remain bullish about Apple despite yesterday’s massive sell-off. In its semi-annual “Taking Stock with Teens” survey which has just been completed, reports StreetInsider.com, investment bank Piper sandler found that the Apple brand retains strong popularity among young Americans. In particular, out of 10,000 teenagers surveyed, 87% said they had an iPhone.

Think about this staggering number for a moment. 10,000 children. Randomly chosen. 8,700 of them own not only smartphones, but also iPhones.

And the news is improving. 88% of those kids said they plan to buy an iPhone as their next phone, and 22% specifically plan to upgrade to iPhone 13 before the end of the year. Piper Sandler concluded her report with this observation: “The results of the investigation [confirm] Apple’s place as the dominant device brand among teens. “

Now what

And how! Of course, that makes it more important than ever that Apple delivers its iPhones to the masses in a timely manner. And in this regard, the report from Bank of America Securities is encouraging. In a separate note on StreetInsider, the stock valuation news site quotes BofA as saying that “our tracking of iPhone ship dates on Apple’s website and on various carrier websites indicates that lead times are improving, especially in the US ”.

Although it takes a little longer than Apple would like to ship the iPhone “13 Pro and Pro Max” models, BofA has found that the availability of the “iPhone 13 and 13 Mini” is very good, especially if you buy your phone from an operator rather than an Apple store (where waiting times are “longer”).

The only bad news you can find in this report is BofA’s observation that “current delivery times are not indicative of significantly higher demand compared to last year”, but rather due to “Ongoing supply side challenges” due to component shortages and production slowdowns in China.

Overall, however, the news is still more good than bad for Apple today, and that is why the stock is on the rise.

This article represents the opinion of the author, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are heterogeneous! Questioning an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.

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