Apple stock has been rising ahead of the consumer electronics giant's March-quarter earnings release as investors bet on a better-than-expected report.
The Cupertino, Calif.-based company plans to post fiscal second-quarter results late Thursday.
Analysts polled by FactSet predict Apple will earn $1.43 a share, down 6% year over year, on sales of $92.9 billion, down 5%. It would be the second consecutive quarter of declining sales and earnings as Apple faces weak demand for Mac computers and iPhones.
Wall Street is hoping for positive news from Apple sales in China and India as well as continued services growth.
Apple Stock Is Outperforming S&P 500
Year to date, Apple stock is up 30.6%. That compares with an 8.6% rise for the S&P 500.
In a recent note to clients, Morgan Stanley analyst Erik Woodring called Apple "the best house in a challenged neighborhood." He rates Apple stock a "top pick" with a price target of 180.
On the stock market today, Apple stock rose 0.8% to close at 169.68.
Woodring predicts Apple will post in-line results but guide analysts lower for the June quarter.
However, he sees several catalysts for Apple stock in the months ahead. They include the rumored introduction of a mixed-reality headset at the company's Worldwide Developers Conference in June.
Other catalysts could include re-accelerating services growth in the June quarter and easing foreign-exchange headwinds. Plus, Apple should see a pickup in handset sales with the launch of the iPhone 15 series this fall, Woodring said.
Apple's Quality Earnings, Strong Balance Sheet
Deutsche Bank analyst Sidney Ho expects Apple to deliver in-line results and give mixed guidance. He rates Apple stock as buy with a price target of 170.
"Investors are attracted by the company's quality of earnings and its strong balance sheet in an uncertain macro environment," Ho said in a note to clients. "We expect this investor preference to continue."
Apple stock is on the IBD Tech Leaders list. Further, it has an IBD Composite Rating of 92 out of 99, according to IBD Stock Checkup.
IBD's Composite Rating is a blend of key fundamental and technical metrics to help investors gauge a stock's strengths. The best growth stocks have a Composite Rating of 90 or better.
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
