How to Buy & Trade Apple Stocks

Apple is a technical giant known in every part of the world. No matter what gadgets you use, you definitely know at least a little about Apple. The company made several revolutions in the tech world, bringing technologies to a higher level. Apple stocks are one of the most desirable investments. If you want to know why, read on.

Apple: Way to the Top

It’s essential to read some of Apple’s history to understand why it's worth investing in its stocks.

In 1976, Steve Jobs and Steve Wozniak established Apple Computer Company. In 1977, it was renamed the Apple Computer Inc. The company made the first revolution bringing PC Apple II to the market. In four years, it became public with a market cap of $1.2 billion. However, both founders left the company in 1985, so its shares plunged to $2.

Apple managed to recover, adding color Macs and the PowerBook laptop. But it had a terrible experience with the Newton tablet and the PowerPC. As a result, in 1997, Mr. Jobs returned to the company. The period leading up to the beginning of the 2000s was successful for the company. Such products as the iMac Power, the Mac G4 Cube, and Mac OS X raised the stock’s value.

But the 2000 tech bubble crash pulled shares to the lows. By 2003, the stock price rebounded. The financial crisis of 2008 made the stocks fall again. Nevertheless, Apple Inc recovered, increasing the stock’s value until 2011 when Steve Jobs left the company due to illness and died several months later. These events led to the stocks’ plunge.

Up to 2020, the price has climbed to about $300.

Apple Stocks: How to Analyze and Forecast

If you are familiar with the analysis of the stock market, you won’t have any difficulties analyzing Apple shares. There are several basic factors that affect stocks of all the companies. Apple is not an exclusion.

To invest in Apple stocks effectively, it’s essential to know how to analyze the market.

Fundamental Analysis

What does it involve? The basic fundamental analysis will include:

• Management. If you read the history of the company carefully, you already know the first factor that affected and will always affect stock’s price of any company. It’s top management. Dismissals, illnesses, and other unpredictable circumstances of senior management lead to a price crash. Thus, to not miss possible price fluctuations, check the names of Apple CEO and read the news regularly.
• Industry news. Apple Inc. relates to the tech industry. Thus, any events that may shake the sector will affect the value of the company.
• Global news. It may seem strange that global news can affect the value of Apple. However, such significant market cataclysms as stock market sell-off or a financial crisis will definitely pull Apple stocks down.
• Earnings report. Quarterly, every US company must provide data on its earnings. It will show a trader or an investor how the company performed for the previous three months. Any decline in the earnings report signals company’s difficulties. Thus, the stock’s price will move downward. If you trade CFD, there is one more option. Check analysts’ estimates and compare them to either previous or actual data.

The factors mentioned above will cover all your needs if you trade. However, if you are an investor, you will need to do in-depth research:

• Price-to-earnings ratio. This ratio will show you how much you would spend to earn $1. To understand whether Apple stocks are over- or undervalued, you will need to compare the ratio with its peers. For example, if the ratio is much higher, the shares are overvalued. Thus, there are odds that they will fall soon. To calculate the ratio, you need to divide the market value per share by earning per share.
• Return on equity. The ROE reflects the return on assets. To calculate it, you should divide net income by the equity of a stakeholder. A low value is a sign the stocks are overvalued.