Data: Apple primed to beat earnings estimates

Published Tue, Jan 26 20165:00 AM ESTUpdated Tue, Jan 26 201611:15 AM EST

Apple's shares are down more than 16 percent the last three months versus an approximately 10 percent decline for the S & P 500 and Nasdaq as investors and analysts lower their expectations for the company's earnings report Tuesday evening. Many investors are betting the tech giant may actually surprise with an earnings per share beat, according to Estimize , a crowdsourced financial estimates platform, where more than 16,000 people provide their own guesses. Estimize claims its earnings consensus is more accurate than Wall Street's average estimate 76 percent of the time and revenue estimates are more accurate 71 percent of the time. Source: Estimize This bodes well for Apple as Estimize's December quarter earnings per share consensus (blue line) is $3.27, which is above the Wall Street consensus (black line) of $3.23. Source: Estimize The tech giant often trades more on its sales figures. And the bar has definitely been lowered there with analysts slashing expectations significantly. Estimize's December quarter revenue consensus (blue line) at around $77 billion is ahead of the Wall Street consensus (black line) at a little more than $76 billion. "We believe that (Apple) expectations have come down enough and the stock has been battered enough that the bad scenario is already priced in to the stock," Leigh Drogen, Estimize's founder and CEO, wrote in an email. Source: Estimize Also helping the bullish trade setup is the fact March quarter estimates were cut even more dramatically than December's. The Wall Street average sales estimate for Apple's March quarter went from $60 billion to just under $56 billion in the last two months, according to Estimize. Read More Pro Uncut: Full interview with Goldman's Gary Cohn The lowered March numbers mean any decent forecast could rip the stock higher. "The numbers Apple provides around last quarter's iPhone sales and its guidance for this quarter are going to have a huge impact on what happens to the share price. If either number is well above what analysts are projecting, then you could see a major upswing in the share price, but it's hard to see Apple providing numbers that are below the pretty pessimistic forecasts analysts have been pitching," Jackdaw Research's Jan Dawson said in an email. Read More Santoli: Frightful January plunge not scary enough? To be sure, some on Wall Street think Apple will still miss the lowered sell-side estimates. But that might not mean there's no chance for a rebound. "We believe sell-side estimates are still too high. Buy-side expectations have come down significantly though and are likely well below the sell-side. If March guidance is at least in line with buy-side estimates, then the stock should hold," Pacific Crest's Apple analyst, Andy Hargreaves, wrote in an email.

An Apple store employee with a customer in Chicago.

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Apple's shares are down more than 16 percent the last three months versus an approximately 10 percent decline for the and Nasdaq as investors and analysts lower their expectations for the company's earnings report Tuesday evening.

Many investors are betting the tech giant may actually surprise with an earnings per share beat, according to Estimize, a crowdsourced financial estimates platform, where more than 16,000 people provide their own guesses.