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A parallel pummeling in the shares of Apple (NASDAQ:AAPL) and Best Buy (NYSE:BBY) caught my attention over recent months. After having spent a great deal of my life analyzing stocks, and while always discerning market anomalies and economic developments, I could not help but to notice an interesting tie between Apple and Best Buy.

The two have notably underperformed the S&P 500 over the last three months, as seen in the chart below, but have nearly mirrored one another. As a result, and because of similar factors firing for each company, I believe an alignment of fates will lead each company's shares to recover in coming months. My reasoning for this double-long call has not been discussed much in the media or voiced prevalently by Wall Street. Thus, when improved operating performance is reported for each for the current quarter as I expect, this reasoning should prove a forceful alpha driver for each company's shares over the next few months.

Chart forBest Buy Co., Inc.

Apple's recent decline, with the shares dropping 28% from their 52-week high marked intraday on September 21, has been argued to be the result of several possible factors. Many of the issues facing Apple also stand against the entirety of the market, including Best Buy. Those include the fiscal cliff fiasco and the potential for lightened consumer spending in 2013 as a result.

Apple also faces factors that do not influence Best Buy shares. For instance, some theorize that investor concern about potentially unfavorable changes to capital gains tax law in 2013 could have investors selling the capital gain rich shares in 2012 to lock in profits at lower tax rates. Also, disappointment about Apple and its missing the holiday shopping season without a Smart Television product is believed by your author here to be a failure against market expectations. Any time a company misses expectations, its shares decline if those expectations are believed to be priced into the valuation of the stock. I discussed the importance of an Apple Television introduction in October.

The Common Denominator

One reason for AAPL's share decline seems to be as important in explaining the slide in BBY. Best Buy's shares are down 38% from their intraday high on September 21, the day AAPL also marked its 52-week top. The common denominator between the two companies is of course the common Apple products each sell.

The rise of Apple over the last ten years has certainly benefited the electronics retailer as well. The Apple iPod, iPhone and iPad have at minimum served as draws of customer traffic into Best Buy stores, and at best resulted in increased sales of those today mutually critical goods. Apple's market share grabs have intensified its importance to electronics retailers. Thus, when Apple introduces new products, Best Buy's performance is impacted, and timing can matter a lot in this business.

Over the last five years, discount retailers and online operators seem to have benefited even more than Best Buy. This is at least partly in evidence in the outsized rise of Amazon.com (NASDAQ:AMZN) versus BBY and other brick and mortar operators. Also, the brand strength of Apple goods dictates that when shoppers go searching for them, price will determine their destination while sales assistance will play a smaller role. This fact has only intensified with time and as new versions of existing products replace old now well understood i-gear.

What Had Happened Was

Over the last three months, AAPL and BBY appear to have been especially closely tied, obviously due to the hot electronics the one makes and the other sells. The cause of issue in simultaneously sour stock performance appears to me to be greatly due to the timing of new product launches at Apple. You see, when an Apple introduction is expected, sales of legacy gear slow ahead of it. It's sort of like how the ocean first drains out before a tsunami strikes the shore. Potential buyers put off purchases and wait until the newest and latest version of the iPhone, iPad and/or iPod become available.

The latest such lull occurred in the third quarter ended September due to the launch of the company's iPhone 5, new iPod touch and iPod nano at the back end of the quarter, and also on the introduction of several products all bunched into October or Q4, including the new and hot iPad Mini.

Initially announced in October, Best Buy reported on November 20 that its fiscal third quarter ended November 3 saw a significant softening. Before restructuring charges, its non-GAAP net earnings from continuing operations were just $0.03 per share, versus $0.47 for the prior year period. Within its press release, Best Buy said, "The company believes that tablet and notebook comparable store sales were negatively impacted by slower consumer purchasing in anticipation of major product launches." The company's performance was a huge disappointment to shareholders. Best Buy obviously has other issues, especially in meeting its competition online, but Apple's product launch timing was likely the main driver of the shortfall, in my view.

Apple's share slide had begun before it reported its fiscal fourth quarter results in late October. While the company reported strong year-over-year growth at the top and bottom lines, it still missed analyst expectations. Thus, its shares built in more skepticism about the company's ability to remain atop the hill, given increasing and improving competition in its established markets. Certainly its profit margins would be threatened at minimum.

Apple's FY Q4 EPS of $8.67 represented 23% growth over the prior year quarter, but analysts had their hopes at $8.75 according to data compiled by Yahoo Finance and partners. Apple reported 26.9 million iPhones sold in the quarter representing 58% unit growth, but it also saw a 19% unit sale decline in iPods ahead of important new product introduction.

Once all the new gear became available, save the long anticipated Apple smart television, we expect sales activity improved for both companies through the holiday season. I anticipate that the insider interest in Best Buy, with its founder seeking to take the company private, reflects that view. It's my belief that Best Buy management feels the same way, given its interest in putting off consideration of the founder's interest until after it reports its fiscal fourth quarter and holiday results. Furthermore, I'm a big fan of Best Buy's email and web sales strategy, and its sales growth online ($431 million revenues in Q3 and +10% growth) reflects its increasing ability to compete on the medium.

I've discussed Apple's valuation several times over the past year, most recently highlighting the value enhancement I see possible in AAPL through the introduction of an Apple Television product. I've also noted the positive and negative reasoning for and against an AAPL stock split. As the year turns over, capital should find AAPL again, and when the company reports its fiscal first quarter, I expect a better reception than it found in its FY 2012 Q4. I'm also anticipating the smart television finally finds a market in 2013, and that should be an exceptional driver for the stock in my view. Thus, I remain supportive of AAPL at this point, and especially after its recent weakness. After 2013 and beyond, I respect the challenges this maturing company faces without its visionary.

Best Buy is an especially appealing value play for the start of 2013 in my view, though it faces its challenges over the longer term as well. Still, the stock is on sale now after its most recent disappointment, and I expect a reversal in price trend on the benefits of those Apple introductions bunched at the close of year. The stock's numerical value, with a P/E of 5.5X the heavily penalized FY 2014 (Jan.) consensus estimate of $2.12, is appealing. I expect that EPS estimate, now down 29% from where it stood 90 days ago, might have been overly hedged by the analytical community (it's a rare occurrence except when it's late). If the company can restore any sense of stabilization and better incorporate its online business, as I expect it can, capital is likely itching to fund it. At least near-term, with the prospect of a private equity interest arising as well, the stock should have significant upside as a value play in early 2013.

If the fates of these two companies are indeed tied over the near-term, then each should benefit from the product introductions that found hungry hands in the final calendar quarter of 2012. Considering that each stock has suffered on the heels of a soft summer season on anticipation of those introductions, I think the odds are in favor of a turnaround here. Thus, I recommend the purchase of both AAPL and BBY on this shared alpha driver.

Source: The Fates Of Apple, Best Buy Are Tied