Apple shares reached a new all-time intraday high on Tuesday, continuing the rally that led to and followed the stock’s 4-for-1 split.
Ines Ferré for Yahoo Finance:
To date, Apple is up 80%, while the S&P 500 is up around 8%. The move has some analysts on their heels as they aim to explain what is happening to their clients.
In a research note to clients, BofA analyst Wamsi Mohan highlighted possible factors behind the stock’s “exceptionally strong period with better results than the wider market.” A recent “influx of retail investors” suggests momentum as a factor, he said.
“Our conversations with institutional investors suggest that Fear Of Missing Out (FOMO) is not yet at work given the relatively rapid recurrence and concern that fundamentals cannot continue to support upside down,” he wrote.
“Analyzing recent weeks with trading data suggests a strong influx of retail investors, suggesting that MOMO (momentum) is the strongest attributable factor,” he said, warning that “momentum could cut both ways, especially given the risk to September / December qtr. estimates (especially on high-end iPhones). ”Although he noted that” in the short term, momentum can trump valuation. ”
MacDailyNews Take: In the midst of the Apple rally, Mohan raised BofA’s Apple price target to $ 140 while maintaining a “Neutral” rating.