'Nightline' Looks at Apple's Woes as Stock Declines 20% from All-Time High

[TheHateMachine]

Originally Posted by Tankmaze

can't understand how the stock market works.
all i see is a great lineup for the holiday and the stock plummet

Growth is slowing, decreasing margins, supply chain issues, brand loyalty decreasing, perceived lack of innovation and stale lineup, iPad Mini cannibalization of other products and trader emotional responses.

Lots of things can effect stocks.

[BaldiMac]

Originally Posted by Rodimus Prime

it could be Apple it taking a hit from the fact that so much of their money and income is tied up in the iPhone and time and time again it is losing market share.

"Time and time again." Otherwise known as seasonality. I don't think it is a red flag that Apple has a higher market share in the holiday launch quarter than the quarter right before a new release. If you look at iPhone market share year over year, they continue to gain market share.

[ArcaneDevice]

It's down 20% from being the most valuable company in the world even though Apple now basically only makes phones?

The stock price was stupidly high to begin with considering Apple's output so losing 20% brings it down to more sane levels. It's not as if it's selling at 30 cents a share.

[Moopy Sac]

Originally Posted by dethmaShine

On a different note, where are these articles about google losing more than a 100pts in only two weeks?

Those stories were all over the internet (GOOG is down a little over 13% from its high, not as big of a decline as AAPL which is down almost 22%).

But this is MAC Rumors, so...

[Digital Dude]

It was inevitable that we would see that Tim Cook is no replacement for Steve Jobs and how he ran the company.

[pedromartins]

Originally Posted by Rodimus Prime

it could be Apple it taking a hit from the fact that so much of their money and income is tied up in the iPhone and time and time again it is losing market share.

But they are selling as much as they can make them... Maybe they should make another model?

[Popeye206]

Originally Posted by Rodimus Prime

it could be Apple it taking a hit from the fact that so much of their money and income is tied up in the iPhone and time and time again it is losing market share.

Yeah... the iphone is selling so bad, Foxcomm can't keep up!

[samcraig]

Originally Posted by Hastings101

On the flip side, don't buy and avoid the panic that comes when "expectations" set by analysts aren't met (calling it now) when the holiday quarter ends and having to see all that money you borrowed and saved up shrink . Apple's not dying off, they were just ridiculously overvalued for a company focused around products that are slowly losing consumer interest

Perhaps - but I also think it's market saturation. And also better competition. Which is why Apple is really pulling out all the stops on litigation - especially trying to get products banned.

[iChrist]

Originally Posted by iGrip

This is the greatest buying opportunity I have ever seen.
Everybody should be taking out home equity lines of credit and using the proceeds to buy Apple stock. See if you can refinance your car loan. Take everything out of your 401(k) and IRA accounts. Buy on margin. Buy options. Take next month's rent money. Do whatever you have to, but BUY!

Ha. Yeah everyone listen to this guy.

But please ignore the fact that they have made no software advances in 5 years, their major money maker is getting beat down by Samsung, they are selling very few retina notebooks bc of the insane price, and their new marquee tablet is the 2 year old iPad 2 stuffed in a slightly smaller shell at nearly double the competitors price with the worse screen resolution in the 7" tablet space.

Cash in your kids college savings too. Lol.
.

[JayJayAbels]

Originally Posted by angrynstupid

http://www.youtube.com/watch?v=wdqGS0RWlcw

^ Exactly!!!

For those who don't know... his comments about Apple start at around 3:00.

[baryon]

With the Retina MBP, the iPad Mini and the iPhone 5, what more could you want from Apple? I think these are the best products ever, and I've never seen any other company doing anything like that. Don't see why there would be a problem here.

[nebo1ss]

Originally Posted by JayJayAbels

^ This guy has it right. Really anything under 600 is an absolute steal so long as you have the patience to wait until January... or June of next year.

I see 850 as a great selling point down the line.

When the amateur pundits start buying and recommending a stock you know its time to get out. $400 here we come.

[nick_elt]

Originally Posted by HelveticaRoman

As soon as Apple announce a new Mac Pro you'll see the share price go ballistic ;-)

Once the mac pro is released these forums will go ballistic not the stock price. It is just a tiny fraction of Apple now. Thats why it has almost been forgotten about.

[LordVic]

Originally Posted by Tankmaze

can't understand how the stock market works.
all i see is a great lineup for the holiday and the stock plummet

Stocks is sort of a speculation on future performance of a company, more often than not have less to do with real world performance.

Right now investors believe that Apple will lose a good chunk of something (profit, mojo, who knows), but that the big tying factor that everyone wants is money. Less profits means less dividends paid on stock. And the lower the value.

it's a lot more complicated than that, but a quick jist of it.

There's a lot more to it again than "hey, apple has a good product lineup, so why the negative speculation". the product lineup is secondary. Profit margins, Company goodwill, Perception in the marketplace, expected revenues and costs. There's hundreds of calculations that accountants use to try and estimate if a stock is a good buy or not.

Right now, it looks like the concensus is Apple is going to have some form of lowering of expectations.

I dont entirely blame them. There is a very very long list of items that have investors worried.

I've posted this before (in another thread, and the list has grown)
http://forums.macrumors.com/showthre...4#post16145144

add to this list

Apple lost a lawsuit yesterday and was given a 370 million dollar punishment for patent infringement. They also aknowledged willfully infringing on patents to complete facetime. For a company who's currently suing the world for the same, it's a terrible public perception. this will hurt their goodwill value and lower the company value.

Apple also yesterday put in a new list of devices for a new list of patents they're trying to protect. Apple's image is getting more and more tarnished everytime they do this and the general market is getting fed up.

The UK court ruling was bad enough for them, but their mocking of the judges decision also had negative impact on their public perception. Then their continued mockery by using javascript to hide below the page the actual notice (though I think it was removed).

Rumours that Apple had to help LG with 2 billion dollars means that, while an investment, it's 2 billion less in "profit / cash" available. devaluing the company.

Apple's tablet share has dropped in the last Quarter from 63% to 50%.

Disgruntled users who within 6 months have had their ipad3's replaced with the ipad4's

Ipad mini pricepoint has not sat well with the majority of the market. it's selling well enough, but not what forecasters predicted.

a terrible ipad mini product announcement where apple was forced to do comparisons to another persons device, instead of letting it stand alone and sell itself.

there's not a day anymore that Apple isn't in the news for things outside of their products. This is a terrible thing for a tech company. the news of patents, lawsuits, legal matters seem to outweight the new products, better services and updates by a great margin. Just go look at the news feed from here.

This is why Apple's stock has taken a beating in the last couple months and the original speculation of Apple hitting 1000 / share is a long gone imagination

[tdtran1025]

Human psyche, speculation. The lesson of 2000 was quickly forgotten.

[iphoneclassic]

Originally Posted by flopticalcube

Santa is always good to Apple.

Not this year. Forecast earnings this holiday season below what the Street expected.

http://www.forbes.com/sites/conniegu...ast-live-blog/

[HobeSoundDarryl]

So now, we're a bunch of closet market timers? "Buy at $____ because it won't go lower?" Why can't it go lower? "Best buying opportunity I've ever seen"???

Bearish market analysts are dumb to project against AAPL? But bullish analysts are right on? Or all analysts don't know what they are doing (but the published ones are getting paid to make their best guesses as opposed to those of us certain that AAPL is going to the moon).

2 very simple truths:

1. Every time the revenue curve at just about any company gets overly vertical (hockey stick), the fall is iminent. We've celebrated stronger and stronger revenue charts every quarter. When graphed, we've seen the slope of that growth get higher and higher. That slope can only get so vertical. It always rolls over. AAPLs slope was steep as it roared to 700+.
2. iPod 2001 kicked things off. iPhone 2007 ramped things up. iPad 2010 pushed the accelerator. Where's the <next big thing> 2012? Apple is a "next big thing" company. As such companies get bigger and bigger the pace of launching the next, next-big-thing must accelerate. You see this in the 2001 to 2007 to 2010 pace of launches: about 6 years, about 3 years... What's missing? Apple's "next big thing" in 2012 (about 2 years after iPad) to give the world a new "must have" thing to buy. Apple is now in a place where it needed a next big thing in 2012 and a next, next big thing in 2013, then maybe 2 next, next big things in 2014.

Apple seems to have been in a mode of refining products over the last few years. Then, they simply launch to more markets to set first day/first weekend records (remember when Apple launched only to the U.S., then slowly expanded to more markets around the world over many months?). Of course, with a finite number of markets, this can only work for so long before they eventually launch new products globally on the same day.

What's missing? The next, next-big-thing. The new thing that is not a refinement and iteration of the current 3 legs of the table. Apple needs/needed that thing- whatever it is- to launch in 2012 to keep pace with the growth slope. Instead, we got refinements of existing "legs". That thing better arrive in 2013- probably early 2013- or we may see AAPL continue to feel the pull of gravity.

I won't pretend to know where the share price floor should be (other than I can be certain it can't fall below $0/share). What I will offer is that trailing stop losses can be your friend on rapidly-rising stocks. Put them in place a reasonable distance below the current price and they'll cash you out before you suffer too much of a loss.

If you feel AAPL could fall further but can't bear to sell the stock, buying put options as insurance could be another way to protect yourself if it surprises to the downside (1 put option for each 100 shares of stock you own).

[Gemütlichkeit]

I've always felt Apple has been grossly over valued but still a strong stock (obviously). People are just flipping out because Apple didn't sell as many iPhone 5's as expected. They sold out yet didn't produce the amount they speculated.

Then you have all these people flipping out about the drama going on behind closed doors at Apple.

I'd like to see the stock go down. Maybe hten I could buy 1 or 2 shares lol

[billystlyes]

No doubt, Apple has lost it's shine without Steve Jobs. The product line is also tired. iOS is long in the tooth. And last, but not least, the competition has caught up. And in some cases, surpassed what Apple is doing. So without Steve, I think Apple is just an ordinary company. That is what the stock is reflecting, too.

[Hakone]

I'm sure Apple will post record profit margins for the Holiday quarter. The release of the new iPhone, desktop Macs and refreshed iPad and new mini has almost ensured that. I doubt we'll get back to 700 in the next few months, but I don't think Apple has become a terrible investment.

We'll see?

[sza]

Originally Posted by Tankmaze

can't understand how the stock market works.
all i see is a great lineup for the holiday and the stock plummet

Why people have to buy those products then?

[Rodimus Prime]

Originally Posted by pedromartins

But they are selling as much as they can make them... Maybe they should make another model?

and it is always as short term blip. The problem lies in the fact over 50% of all their profit is tied up in a single product. A product that is lossing market share. Market is growing but the iPhone growth is no longer growing as fast as the market.

That is the problem is so much of Apple profits and money are tied to a single product. If they would diversify and gain a larger chunk of their profit from other things it would help.

Apple products are consumer based money. Consumer market is great for profits but at the same token it is a higher risk as what is hot today can easily turn cold tomorrow. It is not a question of if it will happen but a question of when.

[pedromartins]

Originally Posted by ArcaneDevice

It's down 20% from being the most valuable company in the world even though Apple now basically only makes phones?

The stock price was stupidly high to begin with considering Apple's output so losing 20% brings it down to more sane levels. It's not as if it's selling at 30 cents a share.

Only phones? they never sold as many macs, as many tablets, as many iPod touchs, as many apps, as many music, as many books and films...

you are irrational.

[Spectrum Abuser]

They do need to start innovating, again. The iDevice family is what made Apple in the first decade of the 21st century. They can't rely on this success to last, though. The Apple II made the Apple of the late 70's to the early 80's, but if it hadn't of been for the Macintosh surfacing a few years later the company would of plateaued and declined in market dominance. We'll see how they fair without the original founders at the helm.

[pedromartins]

Originally Posted by Rodimus Prime

and it is always as short term blip. The problem lies in the fact over 50% of all their profit is tied up in a single product. A product that is lossing market share. Market is growing but the iPhone growth is no longer growing as fast as the market.

That is the problem is so much of Apple profits and money are tied to a single product. If they would diversify and gain a larger chunk of their profit from other things it would help.

Apple products are consumer based money. Consumer market is great for profits but at the same token it is a higher risk as what is hot today can easily turn cold tomorrow. It is not a question of if it will happen but a question of when.

but they are selling more and more tablets too... They are growing faster than iPhones.

They never sold as many macs...

Same with the rest of the ecosystem.

What are they doing wrong?