What an amazing year so far for the markets beloved Apple stock. Many factors are working together to drive this stock up to amazing levels day after day. Apple is the leader of this market and will continue to trend up until this story changes. The story is not changing, they are continuing to innovate and dominate. With the fundamentals solid as a rock now all we can do is trade the chart, manage our risk, keep thinking clearly and enjoy the ride. This is not a mania yet, it is a real company with real sales and real earnings that has finally received the respect it deserves with proper valuations. I do not call single digit up moves daily ‘parabolic’, a true mania drives stocks up 20% to 50% in a day, that is wild speculation, mania, or a parabolic move.
During the Dot Com boom of the late nineties there were real companies with real growth along side all the speculative madness of the internet: Cisco and America Online.
Apple is the real deal of our time, and here are twenty forces working to drive this stock up for now.
- It’s a bull market: stocks go up in bull markets not down.
- When every person that has every bought Apple and held it is showing a profit there is little reason for them to sell.
- Last quarter earnings up +116% and sales up +73%.
- Money flows to stocks with growing earnings exceptions.
- Analysts upgraded price targets, they just keep getting higher.
- Blow out sales for the New iPad.
- Small investors understand the company because they hold the products in their hands and love them.
- Apple is a CAN SLIM stock for the O’Neil disciples.
- Even value investor’s love the P/E versus the cash flow.
- Day traders love to trade it long creating intra day support.
- Option traders love the liquidity in the options.
- This is Steve Jobs company, the man was a cross between Thomas Edison and Willy Wonka.
- Apple is dominating the world of communications much like Ma Bell did for most of the last century.
- Apple grows through consuming other industries through innovation.
- Many traders have a simple trading plan: go long Apple.
- Apple investors are holding Apple for the long term and have no interest in selling.
- Everyone is waiting for the stock split and want to be holding when announced.
- Everyone expects a dividend with Apple’s tens of billions in cash.
- Traders are jumping in early in expectations of a run up to earnings in April.
- The trend is your friend, people are riding it until it ends.