Apple's Historical Stock Price Moves from Christmas to January 31

Apple’s shares are down 8% from the Monday prior to Thanksgiving and down almost 12% from the Monday after Thanksgiving.  This is the worst performance for the stock since 2008 when it sold for under $100.  Below is a table of Apple’s stock price starting with the Monday before Thanksgiving to January 31^st of the following year for the past five years.

The weakness in the shares is due to multiple factors including concerns about declining gross margins, earnings cuts by Street analysts and tax gain selling to capture lower tax rates before the end of the year.  However, there are a number of industry analysts that are seeing strong demand for the iPhone and iPad.

The following table shows how the stock has performed from the Monday prior to Thanksgiving through January 31st of the following year.   It is down 8.1% over the past five weeks vs. the past three years when it has increased 4.7% on average.  I would not expect the shares to rally before the end of the year and that it will probably not until earnings are announced (possibly January 22 if it follows the same pattern of the past few years).

While the shares have done well from the day before Christmas to the end of January, there have been wide fluctuations and even beating guidance by a wide margin does not insure gains in the stock.  In January of this year the company beat revenue guidance by 25% and EPS guidance by 49% and the shares would up 13.2% higher than December 24 of the prior year.  In January 2010 the company beat revenue guidance by 35% and EPS by 109% and the shares were down 8.1% from December 24 of 2009.

One major caveat is that one shouldn’t invest based on past stock patterns.  While a pattern could repeat itself, understanding the fundamentals is more important.

Disclosure: My family and I own Apple shares.