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Oppenheimer’s Worth: Apple’s Chart Is ‘So Bad That It’s Good’

By Dan Weil   |   Tuesday, 12 Mar 2013 10:57 AM

Apple’s 38 percent plunge from its September high makes it a buy in the eyes of at least one analyst — Oppenheimer Asset Management chief technician Carter Worth.

“We are buyers here,” he writes in a commentary obtained by CNBC. “A terrible chart, which we believe, is ‘so bad that it’s good.’”

Apple’s drop since September is “mature in terms of magnitude and duration, leaving the stock right back at the level where the euphoric, parabolic move of 2012 got under way,” Worth says.

Editor's Note: How You Lost $85,000 During the Last Decade. See the Numbers.

Apple stood at $438 early Tuesday. It reached a record high of $705 Sept 21. Apple climbed to that level from $420 on Jan. 24, 2012 — a 68 percent move in about nine months.

Now “[Apple] shares have expunged a great deal of the exuberance and hubris of the past year,” Worth writes. The drop in the last 5 ½ months has driven out the “fast money” that dove into the stock starting in January 2012.

Apple now rests further below its 150-day moving average than at any time since the stock market dive of 2008 and 2009, Worth points out. That could presage a move back up to $525, he says.

Morningstar stock analyst Brian Colello has a $600 fair-value estimate for the stock.

“Apple's strength lies in its experience and expertise in integrating hardware, software, services and third-party applications into differentiated, premium devices that provide superior functionality and ease of use for the end customer,” he writes on Morningstar.com.

But the company faces intense competition, Colello notes.

Editor's Note: How You Lost $85,000 During the Last Decade. See the Numbers.

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Apple’s 38 percent plunge from its September high makes it a buy in the eyes of at least one analyst — Oppenheimer Asset Management chief technician Carter Worth.
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