Market Overview

It's Time For An Apple Pullback, Traders Say On CNBC

It's Time For An Apple Pullback, Traders Say On CNBC

With shares up more than 13 percent since the start of August, Apple Inc. (NASDAQ: AAPL) stock could record its best trading month in five years.

The Pros

Matt Maley, an equity strategist at Miller Tabak, and Chantico Global CEO Gina Sanchez shared their takes on Apple during a CNBC "Trading Nation" segment.

Maley Sees Stretched Valuation 

Apple's relative strength index — a tool to analyze if a stock is overbought or oversold — stands near 70, which is the highest it has been since the start of 2018, implying the stock is overbought, Maley said. The stock started the year near the 30 threshold, implying it was oversold.

Another technical analysis tool leads to the same conclusion, he said. The iPhone maker's stock is trading at a 62-percent premium versus its 200-week moving average, a scenario not seen since 2015 and which coincides with the stock's approximate 20-percent pullback.

Investors may want to reconsider "chasing the stock" at current levels and instead consider adding to existing positions on any dips, Maley said. 

Sanchez: Time For A Breather

One of the biggest selling points for Apple stock was that it offered investors the best value within the tech sector, Sanchez said during the CNBC segment. But Apple's stock multiple rose from 14.7 times forward earnings at the end of July to 16 times today, she said. 

"If its best asset was the fact that it used to be cheap, it is less cheap now," Sanchez said. "It is probably due for a breather."

Price Action

Apple shares were up 0.63 percent at $216.41 at the time of publication Thursday. 

Related Links:

Apple Reaches $1-Trillion Valuation: Jim Cramer Shares 10 Takeaways

Cramer Questions Why Apple Trades At Valuation Discount To Procter & Gamble

Photo courtesy of Apple. 


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