As the trading days continue to pass by, Apple Inc. (NASDAQ:AAPL)‘s fundamentalists increasingly appear to be in a vis-a-vis position with technical analysts. On one side of the aisle, shares of the tech giant are obviously attractive, trading at below-average valuation metrics, from the P/E to the P/C ratios. From a chart-watcher’s perspective, however, AAPL is slowly treading into bearish territory, nearing the dreaded “death cross” (see Should You Trade Apple Near the Death Cross?), in addition to seeing high volume on down days, a classic “sell” signal.
In the midst of this debate, though, investors may have missed one very important piece of information coming from notable Apple analyst Brian White of Topeka Capital Markets. White is known for having one of the most bullish AAPL price targets on Wall Street; he currently holds a $1,111 target on the tech company.
As originally reported by Barron’s this morning, White reported a massive uptick in his “Apple Monitor” last month. According to Barron’s, the Apple Inc. (NASDAQ:AAPL) Monitor “looks at sales by Taiwanese electronics manufacturing firms that supply Apple, as a sort of proxy,” and on a monthly basis, the index rose by 16% in November. This spike is notable, because it is “three times the average increase over the past seven years.”
From White’s standpoint, the above-average gain “is driven by the strongest new product ramp in the company’s history,” but what does it mean for investors? Well for starters, it did predict Apple Inc. (NASDAQ:AAPL)’s disappointing earnings in the company’s fiscal third quarter this summer. In June, one month prior to the release of Apple’s Q3 results, the Monitor dropped by 13%.
Obviously, it’s impossible to know what Apple’s top line will be until it reports its first quarter results in late January, but if supplier sales are any indication, we may be in for a positive surprise. On the Street, the consensus revenue estimate is $54.8 billion, which would mark an 18% increase year-over-year. At Apple Inc. (NASDAQ:AAPL)’s current valuation, it seems clear that if the stock were to receive such a positive growth driver, a significant portion of the recent selloff could be erased.