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For the longest time, Apple shares were having an extraordinary 2018, becoming the first company in history to reach a market cap of $1 trillion in August before hitting an all-time high of $233 at the start of October.

Cut to the first week of 2019 and, after a galling final quarter, it found itself at $142 for the first time in 18 months. Apple shares now sit at a current trading price of $153.86.

The company’s last update actually had a lot of positives. Earnings rose 41% to $2.91 per share, a decent way ahead of the forecast $2.78, while revenue jumped 20% to an estimate-beating $62.9 billion. That increase in revenue was achieved through a higher average iPhone selling price of $793, compensating for the iPhone sales miss of 46.89 million units versus the 47.5 million expected. Services revenue, meanwhile, was up 27% to $9.98 billion.

Perhaps the most notable element of the report, however, was news that going forwards Apple would not be revealing individual sales numbers for the iPhone, iPad and Mac, a way for the company to take back the narrative after years of investors getting hung up on units shipped.

A surprise letter from Tim Cook in early January then revised the company’s Q1 forecasts, cutting its revenue estimates from $89 billion to $93 billion to a comparatively rubbish $84 billion due to problems in China. Earnings, meanwhile, are expected at $4.16 per share.

What could be more important is its guidance for Q2, given reports it has cut iPhone production for the January to March quarter by 10%.

Apple shares have a consensus rating of ‘Hold’ alongside an average target price of $195.74.

This article is brought to you in association with Spreadex. All opinions expressed in this article are from the author and do not necessarily represent the opinions of The Armchair Trader. You can find out more about Spreadex products and services here, or find more articles from Connor Campbell here.

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Connor Campbell

Connor Campbell

Connor joined Spreadex in 2014 as part of a newly expanded financial analyst team after graduating from the University of Southampton with an MA in English. His focus is on providing Spreadex's customers with up-to-date and informative news, and is responsible for the market analysis found on the Spreadex website.

Connor produces three daily market updates, a daily stock earnings preview, a weekly financial market preview piece every Friday, a round-up of all the big financial stories making the weekend press every Monday morning and regular stock market features.


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