SPY Jumps Above 200 Day Moving Average, Getting Bulls Excited

The S&P 500 has broken above the 200 day moving average, and has many bulls excited and believing a large, sustained rally is on its way. Personally, I’m skeptical that a rally will last very long, and believe a downturn will resume within 6 months. Moreover, I would suggest bears have the upper hand so long as the market remains below 410.

In any event, bulls should keep an eye on the fundamentals and price action of many mega cap stocks that drive the value of many large index funds. Below we examine the fundamentals of Apple and Tesla, comparing them against each other. Admittedly, there are some signs of strength here.

A Comparison of the Net Income, Revenue and Gross Margin Growth Rates for AAPL and TSLA from March 2020 to September 2022

Over the past two years, there has been a marked trend in terms of net income for both AAPL and TSLA. As of March 2020, AAPL had a net income of $57.22 billion and TSLA had a net income of -$14.43 million. As of September 2022, AAPL had a net income of $99.80 billion and TSLA had a net income of $1.12 billion.

The growth rate of AAPL’s net income is much higher than that of TSLA as AAPL’s net income increased by 74.71% over the two year period, while TSLA’s net income decreased by…

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About the Author: ndenotto@adammesh.com