Should You Take A Bite Into The Beaten-Down Apple ETFs?

Technology giant Apple Inc. (AAPL - Free Report) logged in its seventh consecutive weekly loss, something the stock hasn't done in the past six years. The broad tech sector turmoil, as well as negative news flow, has taken a toll on Apple shares lately. In fact, the stock is down nearly 20% from its recent peak, indicating that it has entered into the bear market. With this, Apple's value has dropped to about $886 billion from the October highs of $1.13 trillion.

The decline stemmed from investors’ concerns that Apple, renowned for years of innovative technology, will suffer declines in iPhone unit sales over the next couple of years. This is especially true as many Wall Street analysts lowered their iPhone sales estimates following reports of production cuts by Apple's supply chain partners. Apple plans to buy fewer parts from Lumentum Holdings (LITE - Free Report) and Qorvo (QRVO  - Free Report), implying that it will sell fewer iPhones going forward than initially expected.

In particular, Guggenheim Securities stated that increased average selling prices won't be enough to offset slowing iPhone demand and lowered its rating on the stock to neutral from buy. It also removed its prior price target of 245 on the stock. Meanwhile, Goldman Sachs cut its iPhone sales estimate for Apple's fiscal 2019 by 5.5% and trimmed his price target on the stock to 209 from 240, while reiterating the neutral rating. UBS has also cut its price target for Apple and blamed lower phone sales expectations for a dimmer outlook.

Further, on its earnings call, Apple said that the company will no longer break out individual sales numbers for iPhone, iPad, and Mac starting next quarter. The three main product lines will be wrapped into one reported revenue figure. This has spread negative sentiments about the company’s growth prospects and that its largest segment by revenue may be set for weaker growth.

However, per a Reuters’ article, several prominent investors put fresh money into Apple during the third quarter anticipating that the iPhone maker's stock would keep rising as strong growth overshadowed rising trade tensions between the United States and China. Mutual fund giant Fidelity added 7 million shares, bringing its total holdings to 110.9 million shares, regulatory filings, and data from research firm show. Janus Henderson Group added 3.3 million shares for a total of 20.8 million shares and J.P. Morgan Chase & Co boosted its holding to 42.7 million shares after adding 1.3 million.

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Disclosure: contains statements and statistics that have been obtained from sources believed to be reliable but are not guaranteed as to accuracy or completeness. References to any specific ...

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