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Mister October? Why Apple’s Stock Is Like Reggie Jackson

Tuesday, 2 Oct 2012 | 6:37 PM ET

Shares of Apple have been pummeled in recent weeks, but at least one pro thinks they are the market's "Mister October" and ready for a rebound.

Reggie Jackson in the 1977 World Series.
Reggie Jackson in the 1977 World Series.

Apple's stock typically surges during October as investors bid up the shares on better-than-expected sales figures from its latest iPhone and expectations for a strong holiday season.

Apple has jumped by 10 percent, on average, during the month over the last nine years, according to a bullish note by Topeka Capital analyst Brian White. (The only down October over that period was during the financial crisis in 2008.)

Apple is “Mister October,” said White, referring to Reggie Jackson’s nickname for his legendary postseason performances for the New York Yankees during the late 1970s.

October: The Best Month to Own Apple?
The Fast Money traders and CNBC's Herb Greenberg discuss how to play Apple this October.

“Taking into consideration the October seasonality, the attractive valuation, the overwhelming demand for the iPhone 5, the growing cash payout potential and other new opportunities on the horizon such as the iPad Mini, we continue to believe it will be difficult for investors to justify not being overweight the stock through the holiday season and into 2013.”

(Read More: Is This What The iPad Mini Will Look Like?)

The world’s most valuable company has its work cut out for it to live up to the 10 percent historical benchmark. The stock fell more than 1 percent Monday, continuing a six percent decline from an all-time high hit on Sept. 19. Some of the sell-off has been attributed to disappointment over the new maps application installed in the iPhone 5. (Read More: What Every Apple Investor Should Know.)

“The gains seen typically during October may have already occurred,” said Jon Najarian, co-founder of TradeMonster.com. “Just like in July, we’re seeing a mini-correction in the stock to flush out the weak longs.”

A late launch of the iPhone may also be working against Apple this year. The September high occurred just before the Sept. 21 launch date of the iPhone 5. The iPhone 3G and iPhone 4 were all launched in June, allowing Apple to announce a full third quarter of sales of the new devices during its October earnings report.

When Apple announces earnings for last period on Oct. 15, the results will only include 10 days of iPhone 5 sales.

Still, many traders agree with White that Apple is still primed to hit it out of the park in October.

“Apple is a great buy at this level,” said Stephen Weiss of Short Hills Capital. “On a percentage basis, the movement is relatively insignificant and is only following past patterns of selling off after a product launch.”

For the best market insight, catch 'Fast Money' each night at 5 p.m. ET, and the “Halftime Report” each afternoon at 12:00 ET on CNBC. Follow @CNBCMelloy on Twitter.



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