andrew.berg

AAPL in front of earnings

NASDAQ:AAPL   APPLE INC
Recent news:
* Deal with IBM            
* Split 1:7
* Presentation of new iOS 8
* Acquisition of Beats for $2.6 bln + 400 millions of shares

Tendencies and perspectives:
* Smartphones with big screen threaten sales of iPad
* market share of tablets reduced according to research
* Smart home, Apple             Smart-TV, Touch ID, iWatch - these are innovations that investors expect from Apple            
* iPhone 6 with sapphire glasse?
* Rumors: Apple             can acquire Tesla            

What to expect:
* EPS             expectations $1.23 vs $1.07 yoy
* iPhones + iPads = 3/4 of profit
* Analysts upgrades (Barclays, UBS             , JMP: $110, $115, $135 respectively)
* Comments of upper management and Tim Cook on Conference Call about new products coul be catalyst
* I think, numbers will meet expectations

How to trade:
* Hold Call options in front of earnings. I like this idea because it has well defined risk-premium and you wont be caught with gap down.
* Long above $97 resistance
* Long if drop down to support $89.65-$90.00
* Gap up and cover (Buy on rumors, sell on news)
* Open below $92.50-$93.00 - short to bigger support
timwest PRO
2 years ago
Nice overview of all the relevant points. Well done!
+1 Reply
andrew.berg PRO timwest
2 years ago
Thank You, good preparation and plan before event is important to trade well
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