Apple's Stock has tanked, anyone know why?

Discussion in 'Macworld San Francisco 2008' started by Harthansen, Jan 25, 2008.

  1. macrumors member

    Joined:
    Jul 17, 2002
    #1
    Apple's stock (APPL in NYSE) has plummeted $68 in the last 30 days (from $198 to $130 or 35%) does anyone know what has caused this? Curious...

    -Hart
     
  2. macrumors 6502a

    Joined:
    Dec 7, 2007
    Location:
    Los Angeles / Boston
    #2
    It definately did drop more than all the other stocks out there, i'm curious as well.

    Maybe we were all hoping for...you know, some ACD updates, a tablet, more refreshes, etc >_>
     
  3. macrumors 603

    gr8tfly

    Joined:
    Oct 29, 2006
    Location:
    ~119W 34N
    #3
    MacWorld, quarterly report and market in general. Expectations of MacWorld beyond reality and can't top iPhone. Quarterly report also not up to predictions, most of which were not from Apple. The rest was tracking the market, in general (compare today's chart for AAPL with the Dow).

    Good time to buy, from what I can see. Actually bought more, myself.
     
  4. macrumors 65816

    Cloudane

    Joined:
    Aug 6, 2007
    Location:
    Sweet Apple Acres
    #4
    Not a stock expert, but I do know the tech industry on the whole is suffering a bit of a slump at the moment. Redundancy cometh where I work.
     
  5. macrumors 65816

    Luis

    Joined:
    Jul 19, 2006
    Location:
    Costa Rica
    #5
    It's not only Apple, it's the whole market AFAIK.
     
  6. macrumors 65816

    Muncher

    Joined:
    Apr 19, 2007
    Location:
    California
    #6
    Good time to buy. $$ :D
     
  7. macrumors 68000

    GroundLoop

    Joined:
    Mar 21, 2003
    #7
    The biggest cause of the stock drop was the quarterly earnings report. Essentially iPod sales in the US are flat (~5% growth year over year). That scared a lot of investors into thinking that the cash cow is almost milked dry. Then, on top of that, Apple gave an ultra-conservative estimate for Q2 base on the slowing economy and sales seasonality. Apples estimates for Q2 were WELL BELOW Wall Street's expectations.

    Hickman
     
  8. macrumors 65816

    valdore

    Joined:
    Jan 9, 2007
    Location:
    Kansas City, Missouri. USA
    #8

    The ticker is AAPL, and it's traded on Nasdaq, not NYSE.
     
  9. macrumors 6502

    Joined:
    Dec 29, 2007
    #9
    Apple just released its quarterly, and while it was higher than apple's expectations it did not meet analyst's expectations.
     
  10. macrumors 68000

    GroundLoop

    Joined:
    Mar 21, 2003
    #10
    Not quite. Q1 exceeded everyone expectations financially. But it was the appearance of slowing iPod sales that scared everyone. The reason that Apple made its numbers is because Mac sales were extremely strong and covered the slowing iPod growth.

    That and the very weak guidance for Q2 would scare a lot of investors who thought that Apple was a safe haven.

    Hickman
     
  11. TEG
    macrumors 604

    TEG

    Joined:
    Jan 21, 2002
    Location:
    Langley, Washington
    #11
    Apple reported a great previous quarter, but thinks that the next quarter may see fewer sales due to a perceived slowdown in the US economy (even though anyone with even a gnat's knowledge of economy would know that it is not a big deal). The stock market is a bet on future performance, not past performance, therefore people who have no idea what they are doing [read: most investors] dumped the stock to make their profits. I have 50 shares at a split adjusted cost of $10, so I'm holding on to it for the long run.

    TEG
     
  12. macrumors member

    Joined:
    Nov 15, 2007
    #12
    The aforementioned reasons of poor market and low expectations for the next quarter.

    But what this also indicates is that the wealth effects of the poor market now will especially hurt Apple this year since Apple makes relatively expensive or high-end products. More expensive goods are more elastic; Apple's products are more affected by decreases in (perceived) wealth than cheaper goods. The price tag on the iPhone becomes much more important.

    Hopefully people will see they are going to get a $600 check from the stimulus package and decide they can afford an iPhone after all.

    I second that now may be the time to buy aapl, if the market does not continue to slide.
     
  13. macrumors regular

    Pandaboots

    Joined:
    Nov 19, 2007
    Location:
    Dallas, Texas
    #13
    Basically people are idiots. It's common knowledge that Apple holds the market share on mp3 players by a huge margin. It will take years (if ever) for Apple to lose that position. However, iPod sales should slow as the market becomes saturated. Everyone now has an iPod, except for the handful of Zune owners and off-brand owners who are just plain too cheap or too dumb to buy the real McCoy. At any rate, Apple now has the challenge to maintain their market share and they will do so through innovation and continually improving their product to get all of us to keep upgrading to the latest and greatest iPod.

    I think investors and analysts alike need to now focus their attention more on the iPhone, movie rentals/:apple:TV and the Macs as this is where Apple still has a lot of room to grow. Apple has a real chance to reproduce the iPod through their :apple:TV and I believe that if/when their movie rental/purchase division does take off, it will be more lucrative than their music division. Apple also gained a 20% market share on the smart phone industry in their first 90 days with the iPhone. I feel that when iPhone take 2 is released, sales of that unit will make the 1st iPhone look like child's play. The fact that the Mac consistently gains market share cannot be ignored. Apple really needs to step up here and get the excitement back into their computers, much like they have done with the iPod/iPhone/iTunes.

    Just remember how terrible the 1st generation iPods were compared to the current models and how far it has come. Apple has the opportunity again to do this with iPhone/:apple:TV/Macs --> yes with the Mac too...they need to innovate again with their computers. Not take a computer and make it thinner and lighter with less features, but really innovate here. Create a paradigm shift in how the world uses and thinks about computers, much like they did with music. Unless you think that Jobs and his crew are done and they have nothing left to give then I say buy Apple. Apple has been in existence for 32 years now and is at the top of their game. They have great momentum, a ton of cash lying around and a great management/marketing/engineering team still in place. Hell, I'm kinda glad that Apple's stock is getting negative press lately. With any success always comes the pessimism of "when" will they fall. You know as well as I do, that when Apple shocks us all again with their innovation, everyone's gonna jump back on board and will probably think twice before leaving again.

    So bottom line is this: When Apple starts showing that they are losing market share in all their divisions, start racking up debt and start giving us dull and crappy products to buy (like their competition) then I'd sell and run...until then buy and hold.....What kills me the most is that all of these financial companies who basically created the mess we are in and are writing down billions in losses every quarter are enjoying nice rebounds to their stock prices. People are idiots.
     
  14. macrumors 6502a

    eRondeau

    Joined:
    Mar 3, 2004
    Location:
    Canada's South Coast
    #14
    The people who own AAPL stock are not like you and me. I'd be shocked if they've even heard of Macworld. They don't use or own Apple computers, they just automatically buy whatever hot stock happens to have gone up this week. When it starts going down, they sell off. Tech stocks are especially prone to this kind of short-sighted selling. It's cold in New York, investors are selling in order to go on vacation. Simiple as that.
     
  15. macrumors 6502a

    yeroen

    Joined:
    Mar 8, 2007
    Location:
    Cambridge, MA
    #15
    Because analysts get paid to pull their "expectations" out of their ass.

    It's a pyramid scheme, the lot of it.
     
  16. Guest

    MikeTheC

    Joined:
    Apr 26, 2004
    Location:
    Gallifrey -- Capitol City, Prydonian Sector
    #16
    Much like stupid users, stock market investors are a whole class of people for whom I have not the slightest bit of pity.

    Apple's stock went down basically due to two factors. First, Apple's Stevenote and subsequent quarterly were lackluster. That's under Apple's direct control.

    Second, the market was going down anyhow, so it dragged Apple's stock with it. Yet somehow Apple (or any other company) is supposed to react to this? Why? Because a bunch of fickle-minded simpletons want their money after behaving in a way which helped to contribute to lower stock prices? Yech. Give me a break.

    Yes, I know the economy is in a slump. Er, downturn. Um, recession. Yeah, whatever. Call it what you will. But why companies have this fear-threat knee-jerk reaction to stock price when it has absolutely nothing to do with what they have done (which, again to be clear, is only 50% true here in Apple's case), I'll simply never know.

    I, for one, didn't care for Stevenote '08. I think there should have been other things for Steve to have introduced. And they wouldn't have to be lavishly over-the-top, either. Just good, useful, and desired things. But nevertheless, it's not like I think Apple's leadership suddenly all developed alzheimers' and now *oh my God* the ship's going to run a-ground, oh save us, save us!

    Load of crap, the lot of it.
     
  17. macrumors newbie

    Joined:
    Jan 25, 2008
    #17
    Apple has received a great deal of favorable publicity in the last year as it introduced the iPhone and increased market share in computer sales. Whenever a company gets that kind of publicity, a number of people will buy its stock simply because it was mentioned in the newspapers, without really analyzing whether the stock was actually worth that or not. This halo effect can last as long as six months to a year, but it disappears on the appearance of any bad news, in this case a market downturn.

    Apple was grossly overvalued because of all the publicity, so it was the first stock to be dumped when the market turned down. Now it is probably grossly undervalued. Personally, I stay away from volatility. There are too many people who are trading stocks, as opposed to investing in companies. There is a big difference. One is looking for a quick profit on a short-term change in price; the other is looking for long-term accumulation of value.

    The short-term traders often do quite well and they brag about their successes, but overall their investments do not do as well as if they had put their money in slot machines in Vegas. That is why I stay away from volatility.
     
  18. macrumors 68020

    Joined:
    Mar 21, 2006
    Location:
    Hoosiertown
    #18
    I've lost a bit. :( actually quite a lot. I bought at around 170ish a while ago in prepare for the surge of macworld like last year but am at a bit of a loss right now. I think my avatar shows my recent mood.
     
  19. macrumors 604

    CalBoy

    Joined:
    May 21, 2007
    #19
    Actually Nasdaq is an index, not a trading cite. The NYSE is an exchange (much like one we'd find in London, Tokyo, etc). What Apple is not listed under is the Dow 30 (commonly referred to only as "the Dow" or "Dow Jones Industrial Average"), which lists the 30 largest companies of the US based on industry and importance (current ones include WalMart, GE, CitiGroup, etc).
     
  20. macrumors 603

    gr8tfly

    Joined:
    Oct 29, 2006
    Location:
    ~119W 34N
    #20
    I wouldn't worry. Just sit back and wait a bit. It'll be back. I have some I bought at 26 (pre-split) and some I bought around iDay (146). Not too worried, but I'm in for long haul anyway.
     
  21. macrumors 65816

    valdore

    Joined:
    Jan 9, 2007
    Location:
    Kansas City, Missouri. USA
    #21
    Nasdaq is first and foremost an electronic stock trading medium, but also an index. You needn't elaborate on what the NYSE is, I have a bachelor's degree in finance and work in commodities.
     
  22. macrumors 604

    CalBoy

    Joined:
    May 21, 2007
    #22
    Never knew that. Learned something today. :)

    No need to get huffy about it! ;) :p :D
     
  23. macrumors 65816

    valdore

    Joined:
    Jan 9, 2007
    Location:
    Kansas City, Missouri. USA
    #23

    Sorry... didn't mean to sound huffy. :cool:
     
  24. macrumors 604

    CalBoy

    Joined:
    May 21, 2007
    #24
    I always wondered where "huffy" came from. :p

    [/off topic]

    AAPL will recover, but perhaps not soon. The markets are in a state of confusion right now (I can imagine that this week was one roller coaster for day traders! :eek:), but Apple is a solid company with solid earnings, solid growth forecasts, and a solid roadmap for the near future.

    I mean, it's not as if Apple is taking on suspect mortgages...:p
     
  25. macrumors 6502a

    Joined:
    Sep 6, 2007
    #25
    Nah...

    You should've set a Stop Loss at 180 and now be very happy with a new buying opportunity. I actually used this fiasko for the high risk maneuver of buying base 180 Calls for Apple :cool:
     

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