Sunday, January 10, 2016

Apple’s long growth rate is slowing:

Back last June 2015 with Apple Inc trading at 128 I observed that AAPL had built a triple top on a point & figure chart. I also commented on the new Dow Jones component jinx because when Apple Inc was added to the DJII March 2015 a move suggesting that Apple was in transition from a growth stock to a value stock. In other words – the great Apple 2001 – 2015 growth period may be over. Some past DJII growth to value stocks - Cisco Systems added in June 2009. Bank of America and Chevron added in February 2008, Intel and Microsoft were added in November 1999. In contrast Honeywell was dropped from the Dow in February 2008 and subsequently has doubled in price.

Our chart – an undated monthly of Apple Inc displaying the progressively shorter stock price growth periods – from May 2003 to Dec 2007 twenty times. From March 2009 to Sept 2012 six times and from August 2013 to May 2015 only two times. In other words in order for Apple to repeat the 2003-2008 growth window the stock price has to go from the current $100 level to $2000 over the next 5-years. Don’t shoot the messenger


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