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12-03-2022|Business

Apple is on set for its longest losing streak since May, as tech stocks plummet.

Apple Inc.'s stock dropped on Friday, marking the company's worst weekly losing streak since May.

In a sweeping selloff of technology stocks, the stock sank 2.4 percent, ending at its lowest level since November. It fell 5.2 percent for the week, marking the fifth consecutive week of losses, and has lost more than 10% in that time. The Nasdaq 100 Index fell 2.1 percent, marking a 3.9 percent weekly loss.

This year, tech companies have been under pressure due to fears that growth may halt as the Federal Reserve begins to raise interest rates. The group has also been pulled down by Russia's invasion of Ukraine, which prompted commodity prices to spike and heightened inflation fears.

So far this year, Apple has been a relative outperformer. Its decline of approximately 13% is less than the Nasdaq 100's 18% decline. It has attracted investors as a safe haven, but it hasn't been enough to counteract the macroeconomic concerns that are projected to continue to weigh on the sector.

"Investors are seeing macro factors that hint to a slowdown, and Apple is getting swept up in that broad selling," Jordan Kahn, chief investment officer of ACM Funds, said. "I don't think tech is in a position to recover quickly, but given the stability of its profitability and the growth of its services sector, Apple shouldn't experience any multiple compression from here."

Apple has a future price-to-sales ratio of 6.2, which is higher than the five-year average of 4.6. The forward P/E ratio is 24.5, which is higher than the long-term average of 20.3.

This valuation is "more neutral than appealing," according to Kahn, whose fund owns the stock. "It does make it something of a safety play, given there are sections of tech that experienced bubble-like multiples and should continue to see compression," he said.

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