Apple Inc. (AAPL) or Research In Motion Limited (RIMM)? A Technical Analyst’s Perspective

Apple Inc. (NASDAQ:AAPL) has declined quite a bit since eclipsing $700 a share last fall, and it is within $35 of giving up its entire 2012 appreciation. While it remains to be seen if this will happen, it’s important for investors to consider all forms of analysis before making an investment decision. Most value-based theorists have had egg in their face thus far, and at 7.9 times forward EPS and a PEG near 0.5, they’re likely frustrated by the stock’s decline. Still, with three straight quarters without a true earnings blowout, it’s hard to expect otherwise.

Apple Inc. (NASDAQ:AAPL)

With that being said, it’s also important to consider the opinion of technical analysts, who for the most part have been bearish on AAPL over the past few months. On CNBC earlier today, Dan Wantrobski of Janney Capital Markets was on air discussing Apple’s prospects versus Research In Motion Limited (NASDAQ:RIMM). On the subject of Apple Inc. (NASDAQ:AAPL), Wantrobski had this to say:

“Well Apple has been declining for quite some time, you know, the damage has been done on the charts [...] quite frankly we think for Apple to get back on track as a stock [...] it would have to surge back above $500. So, this gives traders on a short-term basis a lot of leeway to play some oversold trades.”

Wantrobski also said that “if it [Apple Inc. (NASDAQ:AAPL] cannot hold this, we’re looking at a $390-$395 handle for secondary support on the stock,” adding “it’s no longer a market leader” from a return standpoint.

Getting to RIM, Wantrobski says that its chart “is basically the inverse of Apple,” and that “RIM has been under accumulation for a long time now.” He also mentioned that:

“The only thing we would caution against is that on a short-term basis RIM shares look overbought here [...] but quite frankly we think that chart is bullish above $15 support, and we think that could charge higher into the low mid $20s on an intermediate term basis.”

To conclude, Wantrobski said “we’d be buyers of one and we’d fade the other basically, we’d underweight Apple at this point.”

What are your thoughts about this analysis? Would you be comfortable initiating a long/short position with RIM and Apple Inc. (NASDAQ:AAPL)? Let us know your thoughts in the comments section below, and for more related coverage, continue reading here at Insider Monkey:

Apple iPhone Market Share Data, 2012

A Bearish Look Back at 2013 with Apple

These Hedge Funds Have Been Killed by Apple’s Selloff

Disclosure: I have no positions in any of the stocks mentioned above

Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The Best B-Boy Movies

Most Awesome Hip Hop Documentaries

Foods That Stain Your Teeth

Richest Doctors in the World

The Best Movie Sountracks Ever

The Highest Grossing Musicals on Broadway

The Most Successful Reality TV Stars

Cheapest Cities to Visit in the US

Most Expensive Summer Camps

Most Expensive Animals in the World

Most Expensive Specialty Crops in the World

Movies That Took Ages to Make

The Longest Hollywood Films Ever Made

Most Expensive Concert Stages

The Richest Bands of all Time

10 Most Corrupt Countries 2013 List

10 Countries with the Highest Quality of Life Index

Most Expensive Mattresses in the World

5 Smallest Countries by Land Area

The Ultimate Heartbreak Songs

Richest Teenagers in the World

10 Most Haunted Places in America

10 Best Places to Retire in Florida East Coast

Top 10 Places to See Before You Die

Top 8 Countries in the World Where Justice Prevails

10 Richest States in America

15 Wealthiest Countries in the World

Richest Singers in the World

Most Expensive Tasting Menu in New York City

Most Expensive Baby Items in the World

Most Expensive Hotel Suites in Vegas

Most Expensive Brunch in New York City

Most Expensive Beef Cuts in the World

25 Best Colleges to Get a Job

Top 10 US Supermarkets

The 25 Most Dangerous Cities in the World to Visit

Most Expensive Xbox Games

Top 11 Cities Where Billionaires Live

Top 10 Most Charitable Companies in America

Most Expensive Seafood in the World

The 10 Wildest Conspiracy Theories

The 10 Best Job Markets in the US

Top 10 Accounting Scandals of All Time

The 25 Biggest Cities in the World

Top 10 Best Paying Virtual Jobs

Most Expensive Leather Shoes in the World

Top 6 Things to Buy in March

The 10 Most Stressful Jobs in America – 2014 List

Top 10 Jobs for Introverted People

Top 10 Honeymoon Destinations in the World

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!