Apple, McDonald's Headline Earnings Wednesday
At www.ValuEngine.com we show that 41.4% of all stocks are undervalued, and that all 16 sectors are overvalued. Here are the latest sector readings. Note that 12 sectors have elevated trailing 12 months price-to-earnings ratios.
Among today's nine companies one is rated strong buy, five are rated buy and three are rated hold, five are undervalued by 0.5% to 32.0% and four are overvalued by 6.1% to 9.1%. Only two are down over the last 12 months, and all seven of the winners show double-digit gains of 15.0% to 41.6%.
All are expected to be higher 12 months from now with projected gains of between 3.3% and 12.2%. The trailing 12 months P/E range from 10.4 to 24.4. We show 5 of 9 above their 200-day simple moving averages reflecting the downside risk of a reversion to the mean.
Reporting before the open on Wednesday McDonald's (MCD) ($92.26) is expected to earn $1.33 per share. MCD set a multi-year high at $102.22 on Jan. 20, 2012, then a 52-week low at $83.31 on Nov. 16 with the stock above its 200-day SMA at $90.37. The daily chart shows an overbought condition and the weekly chart is positive with the five-week modified moving average at $89.77. The stock has a buy rating with my monthly value level at $80.05 with a weekly pivot at $92.56 and semiannual risky level at $96.07.
Reporting before the open on Wednesday United Technologies (UTX) ($86.95) is expected to earn $1.02 per share. UTX is approaching its 52-week high at $87.50 set on March 15, 2012 after setting a 52-week low at $70.71 on June 5, 2012. UTX is above its 200-day SMA at $78.17. The daily chart shows an extremely overbought condition and the weekly chart is positive and will be overbought this week with the five-week MMA at $82.79. The stock has a buy rating with my quarterly value level at $80.70 with a weekly pivot at $87.72 and annual risky level at $88.74.
Reporting after the close on Wednesday Apple (AAPL) ($500.00) is expected to earn $13.47 per share up from $13.43, the estimate posted last week, which is surprising given recent share price weakness. Apple set an all time high at $705.07 on Sept. 21 then traded as low as $483.38 last week with the stock below its 200-day SMA at $594.45. The daily chart is negative with the weekly chart oversold and with the five-week MMA at $530.09. The stock has a buy rating with a weekly value level at $473.95 with my annual pivot at $510.64 and monthly risky level at $604.86.