Apple must grow every year or its stock will crash?

[thermal]

I would just like some clarification:

Apple must grow indefinitely, otherwise it's stock value will go down? Does this sum it up?

I wonder if it's possible for Apple to cease trading on the stock market...

 

[powerstrokin]

That pretty much sums it up for every corporation everywhere.

That's the game. Some companies have survived for a very long time IE: IBM but eventually, they'll all fall.

What's your point, OP?

 

[BaldiMac]

I would just like some clarification:

Apple must grow indefinitely, otherwise it's stock value will go down? Does this sum it up?

No. Stock price isn't tied to any single metric. Otherwise investing would be easy.

 

[hansonjohn590]

That pretty much sums it up for every corporation everywhere.

That's the game. Some companies have survived for a very long time IE: IBM but eventually, they'll all fall.

What's your point, OP?

This. Expectations are set so high they even when you do well, investors always think you should have done better. Not just Apple - this applies everywhere.

 

[zipa]

Well, no. They could start paying huge dividends instead, that would keep the investors happy as well.

 

[Appl3FTW]

OMG we're so doom...

 

[CEmajr]

That's the way it works for all companies. Investors want what they invested to grow.

So a company who posts 20% YOY growth is more attractive to invest in over even if their profits are nil compared to Apple who has massive profits but flat growth.

Unless of course Apple increases their dividend payments.

Think about it like a bank account. Would you rather put $100,000 into a bank that's the biggest bank in the world paying a rate of 1.5% or a smaller bank that's paying out at 5%?

 

[BaldiMac]

That's the way it works for all companies. Investors want what they invested to grow.

So a company who posts 20% YOY growth is more attractive to invest in over even if their profits are nil compared to Apple who has massive profits but flat growth.

You are confusing two types of growth. Stock growth and earnings growth.

Unless of course Apple increases their dividend payments.

Yep.

Think about it like a bank account. Would you rather put $100,000 into a bank that's the biggest bank in the world paying a rate of 1.5% or a smaller bank that's paying out at 5%?

I would not suggest that anyone think about a stock investment like a bank account.

Pretty much anyone that invested in Apple anytime other than 2012 is doing pretty darn good with their investment.

 

[powerstrokin]

This. Expectations are set so high they even when you do well, investors always think you should have done better. Not just Apple - this applies everywhere.

While valid, that's not really what I was getting at.

I'm talking about continued growth in general.

You can only grow so much before you reach a peak and begin to fall. Think about the bigger picture.

The consumerism model is flawed. Hence the level of market manipulation- they are trying to keep this sinking giant afloat, globally.

We're on the Titanic and they are telling us that it's unsinkable... we know how well that panned out the last time.

I'm not trying to be a fear monger, just telling it like it is.

 

[carjakester]

if i had a couple g's invested in apple and didn't see improvement i would worry, thus maybe sell my shares.

 

[nox5]

one year they might grow and another they may miss expectations so the stock price will fluctuate not necessarily crash. At lower prices it may be more attractive and it may bounce back, at too high prices investors can sell stocks.

 

[ineel]

stock

Generally a stock's price reflects the company's future earnings potential. This can be anywhere from a quarter to years down the road. If an investor knows that the company is growing and will continue to grow, the stock is more attractive to them and thus the price of it goes up. This is what happened when apple's shares went up to the $700s a while back as investors predicted that apple would continue to grow at or above the pace it was growing. We know no that apple is facing some pressure by the android OS and recent QE reports show slowed growth. When slowed/no growth occurs, a stock price correction occurs as investors try and flee as they now know the stock is over valued. Investors sell their shares, prices go down. More investors get scared and try and sell and then you end up with apples shares bottoming in the upper $300s last year. Knowing apple is a well managed company by Tim Cook, a smart investor would've bought stock during that panic as apple stock tumbled.

 

[ucfgrad93]

No. Stock price isn't tied to any single metric. Otherwise investing would be easy.

Agreed. There are many things that go into pricing a company's stock.

 

[C DM]

Agreed. There are many things that go into pricing a company's stock.

Like majority of complete randomness of the whole stock market that is based on random opinions of (many) different people.

 

[lordofthereef]

OP,

Stocks crashing is not the same as stocks going down.

I point this out because the title of the thread states their stocks crash, but the body states they are going down. Maybe this was a 'clever' attempt to get more views?

 

[zipa]

Like majority of complete randomness of the whole stock market that is based on random opinions of (many) different people.

I doubt that there are many, if anyone just picking stocks to buy and sell at random. The stock market is simply a weighted average of all the opinions of all the players in the market. It can fluctuate wildly in the short term, but the system is self correcting, so the bumps and dips will cancel each other out in the long term.