Apple Stock Price Hits Lowest Levels Since 2011, Falls Below $400

[lildimsum7]

I think there's a higher chance that earnings are lower in the next 5,10 years. If 60% chance earnings are 20% lower than 2012 (44*0.8) and 40% of the chance earnings are same (44), normalized earnings would be (44*0.8*6+44*4)/10 ~ $39/share. 15x might be ok if you look at this number as a coupon for a risk free bond, so $585/share could be fair. But then the smart buyers would wanna buy close to mid 300s for a margin of safety. I think Apple would buyback at $350-$380.

I hope I'm way off and the conditions are way better than I expect. Maybe earnings never go 20% lower than 2012 and the odds are not what I expect. I could be too pessimistic.

 

[the-seeker]

Secretive works when you have the performance of a Steve Jobs. When you don't produce all the secretive approach gets you is a vacuum, rumors, a stock price cratering, and shortly FIRED.

Exactly. I think the problem right now is, the market (me too) is not convinced that there is a visionary in the Apple campus. If it were Steve Jobs at the top, this silence would be sending the stock price up.
Instead, people now suspect if anything is happening, and questioning if what happens is the right thing.
I can't even imagine how Tim Cook and his gang would handle an antennagate if it were to happen now. A well crafted apology letter??

J Ive might be "that" visionary, but, we haven't seen anything yet....

 

[Captnroger]

Cut your losses now and get out. What you will continue to see is a steady decline. Wall Street has lost it's Apple fever, and unless the company can continue to show the innovation in new products that was demonstrated when Jobs was in office, it will fall back to pre-Jobs levels.

I'm a supporter of the company and the OS, but Jobs brought the company back from the brink, and I'm not alone in thinking they will lack the leadership to continue to launch innovative new products. They will ride on Jobs vision until it's dead, then they will be what they were pre-Jobs.

 

[Apple Corps]

Cut your losses now and get out. What you will continue to see is a steady decline. Wall Street has lost it's Apple fever, and unless the company can continue to show the innovation in new products that was demonstrated when Jobs was in office, it will fall back to pre-Jobs levels.

I'm a supporter of the company and the OS, but Jobs brought the company back from the brink, and I'm not alone in thinking they will lack the leadership to continue to launch innovative new products. They will ride on Jobs vision until it's dead, then they will be what they were pre-Jobs.

That is another way of expressing my concerns as well. I believe they have some tangible innovation roadmap BUT under Tim Cook can't execute their way out of a wet paper bag. Perhaps Cook's confidence was shattered over the maps fiasco and he is more and more tentative. Perhaps he knows he is in over his head.

 

[Bubba Satori]

Wow if only Cook and Ive were smart enough to change the aesthetic of the iPhone we'd have $270B back market value.

Lets see...the Galaxy S4 looks just like the S3 which looks just like the Note 2.

And then of course we have the Nokia N9, Lumia 800 and 920....all so radically different, aren't they?

The way I look at it is when a company thinks they have a good design they don't go changing it just for the sake of changing it. One of Dieter Rams principles of good design is that its long lasting:

Good Design Is Long-lasting : It avoids being fashionable and therefore never appears antiquated. Unlike fashionable design, it lasts many years – even in today’s throwaway society.

Are you familiar with the saying, whistling past the graveyard?

 

[Tinmania]

Are you familiar with the saying, whistling past the graveyard?

Perfect!



Michael

 

[Silvereel]

Yes - but the owners / market are screaming LAUNCH - eonugh of this in the pipeline / cooking - that is what is cratering the stock.

Cook & Team do not appear able to execute.

Yeah, I'm sure that launching a half-done product would do the stock lots of good... I'd rather have a late product than a crappy one.

 

[kas23]

"year-over-year, Verizon's iPhone activations grew by 25%"

Also, don't forget that a lot of people knew T-mobile was going to make an iPhone announcement well before the March 26th date. It's possible a lot of people held off buying to see what T-mobile's deal was going to be.

Hence I wrote "slowing of growth", not "no growth".

 

[pirg]

Hence I wrote "slowing of growth", not "no growth".

Just making sure I got this right...

The holiday qtr where they sold the most iPhones in their history was a fail because they failed to beat wall street estimates

This past qtr where wall street estimated 3.5M iPhones at Verizon, they sell 4M but that doesn't matter now because growth "has slowed"

If they don't meet the overall wall street consensus on April 23rd, the wall street estimate WILL matter again.

So...

Do street estimates matter or not? Or are you just preaching gloom and doom no matter what?

 

[iSunrise]

Cut your losses now and get out. What you will continue to see is a steady decline. Wall Street has lost it's Apple fever, and unless the company can continue to show the innovation in new products that was demonstrated when Jobs was in office, it will fall back to pre-Jobs levels.

I'm a supporter of the company and the OS, but Jobs brought the company back from the brink, and I'm not alone in thinking they will lack the leadership to continue to launch innovative new products. They will ride on Jobs vision until it's dead, then they will be what they were pre-Jobs.

Indeed.

It needs a whole lot of dedication, visions, dreams, passion, arrogance and a lot of strength and intelligence together with a working mix of talented people that can either produce something great or shift the market around and focus on things we already have, but make them practical, efficient and all together a lot more convenient to use.

Steve (Apple) has brought the whole industry a couple of years ahead in a very short time and contenders like Samsung and Microsoft that were basically sleeper agents now seem to have woken up. If it continues like it is now and all signs do point towards it, Samsung and Microsoft are going to be even more aggressive and copy to steal marketshare or go with the "take the ideas and make something better" approach. They are not going to let Apple play this game alone again.

Apple needs some new ideas fast, be very secretive about it and steal the show again. It doesn´t look very promising right now though. And if there´s nothing promising, you should sell and buy back if signs arise that would signal a drastic change, it´s as easy as that.

 

[nylonsteel]

re original article

ah - time to nibble on some aapl now

 

[iGreed]

Nothing to be worried about here, guys. Just another Wall Street speculators attacking the stock before the earnings.

 

[Dmunjal]

I don't see how a new iPhone or iPad is going to change the momentum of the stock. There are two things that could. They need to announce a TV (or at least an upgraded Apple TV) with agreements with all the TV networks. Or they need to raise the dividend appreciably. They can't do the latter because of current corporate tax law.

 

[Apple Corps]

Yeah, I'm sure that launching a half-done product would do the stock lots of good... I'd rather have a late product than a crappy one.

No - the market is demanding a well done product now. Can't understand why some thread participants keep making this non-sensical response.

Fast and right are not mutually exclusive. And much of what Apple is missing, if launched today, would be considered fast. They can't deliver the pipeline.

----------

Nothing to be worried about here, guys. Just another Wall Street speculators attacking the stock before the earnings.

So what will you be saying on Tuesday when earnings miss?

It is damn well time to be worried if you are an investor.

 

[flux73]

Hence I wrote "slowing of growth", not "no growth".

This is the quote from some other poster you were rebutting:

iPhone sales at Verizon actually grew over this period last year.

He didn't say anything else. You argued it as if it were wrong.

Regardless, growth of 25% is still nothing to sneeze at. It's growth. And if it's accurate across all the other carriers, that'd be GREAT news for Apple. The current decrease in Apple's stock price suggest the market thinks they will experience a decrease in revenue/earnings. Now and many quarters into the future.

----------

No - the market is demanding a well done product now. Can't understand why some thread participants keep making this non-sensical response.

Fast and right are not mutually exclusive. And much of what Apple is missing, if launched today, would be considered fast. They can't deliver the pipeline.

----------



So what will you be saying on Tuesday when earnings miss?

It is damn well time to be worried if you are an investor.

Mmm...I don't think the market is demanding anything. I think nervous investors like you are. Apple usually has something in March so when March blew by without a word, people with a lot of money in Apple will of course get worried.

But I just can't get all that worked up. Not saying that Apple is a perfect company. But you don't really think they're just behind the scenes twiddling their thumbs? It'll be done when it's done. 9 women can't produce a baby in 1 month. Nice thing about all this secrecy is that it's not like the rest of the industry is innovating. They're ALL waiting to see what Apple comes out with next.

In the meantime, enjoy the fire sale. I am - I've picked up more shares at $390 and will continue to do so as long as it keeps dropping. The current trajectory downward is about as sustainable as their ascent to $700. So with a company that is still projected even by the most bearish analysts to grow by double digits, at some point there will be an inflection point where even the short sellers will start bailing because it becomes impossibly cheap.

 

[Goratrix]

People were saying years ago that this point will come. Apple has saturated the US market and needs to expand worldwide. There is a potential market of billions of people who are still on dumbphones in the world. However, very few of these people want to buy (or can afford to buy) what is essentialy a luxury item, as their first smartphone. Why would anyone expect someone in a developing country to buy a $900 iPhone when they can buy a $200 android giving them the same functionality? Apple is, and alwyas was, extremely US-centric in their product selections and now it came back to bite them.

 

[Steve121178]

Nothing to be worried about here, guys.

 

[HelveticaRoman]

Sell gold and buy Apple, or is it the other way around?

 

[Rogifan]

Cut your losses now and get out. What you will continue to see is a steady decline. Wall Street has lost it's Apple fever, and unless the company can continue to show the innovation in new products that was demonstrated when Jobs was in office, it will fall back to pre-Jobs levels.

I'm a supporter of the company and the OS, but Jobs brought the company back from the brink, and I'm not alone in thinking they will lack the leadership to continue to launch innovative new products. They will ride on Jobs vision until it's dead, then they will be what they were pre-Jobs.

Why do people keep spewing this BS? My god Apple went 6 YEARS between the iPod and iPhone. And then another 3 YEARS before the iPad came out. It was 3 YEARS between the iMac and iPod. It hasn't even been 2 years since Steve Jobs died. I'm curious to know what innovative new products Apple would have released in 2012 if Steve Jobs hadn't passed away. Care to list them?

----------

Up 20% yoy = good news - something Apple needs badly.

Go put your money in Microsoft then. I don't think you're being forced to invest in Apple.

 

[cat3600]

Are you familiar with the saying, whistling past the graveyard?

If you look at the screenshots both Win 8 and Android look way better than iOS. As I have stated in a few of my posts how boring iOS has become, it looks like its stuck in 2007.

Had every version of iPone including 5, switched over to Nokia Lumia 920, it eats iPhone for lunch, interface is very smooth, the product is miles ahead, sure there are quirks and the App Store is catching up, but really do people even need more then say 10 important apps on a daily usage?? I WAS a total Apple person sadly they are extremely boring now!

People have to use other products to realize what the competition is doing, the camera on the Lumia 920 is the best available, I can see the screen clearly even in direct sunlight, extremely smooth interface, can use the phone with gloves on, very durable as well. Again my family only uses apple products, I for one like to try innovative new stuff.

I have stood in line on launch days for the iPad 1 & 2 was the first person amongst my friends to get one, it was a device I was exactly looking for and everyone was laughing what a flop it would be, look where this kind of device has taken off. But sadly the competition is offering so much more that unless Apple does something drastic and innovative even a die hard fan as me will not go back to their product.

I should not perhaps be using the word fan but I am an Engineer and fascinated by new technology and other companies including google and Microsoft are delivering more now!!

 

[Goratrix]

but really do people even need more then say 10 important apps on a daily usage??

No, but out of those 10 apps people need, 5 or so are usually Google apps. Which are not available on WP8. Which makes the whole platform irrelevant. I'm one of those people desperately looking for a new phone to replace my 3-years old one, and would buy a Lumia in a heartbeat, but without Google Maps, Gmail, Talk and Now, forget it.

 

[kas23]

Just making sure I got this right...

The holiday qtr where they sold the most iPhones in their history was a fail because they failed to beat wall street estimates

This past qtr where wall street estimated 3.5M iPhones at Verizon, they sell 4M but that doesn't matter now because growth "has slowed"

If they don't meet the overall wall street consensus on April 23rd, the wall street estimate WILL matter again.

So...

Do street estimates matter or not? Or are you just preaching gloom and doom no matter what?

You don't seem to have a good handle what goes into determining a stock's price. It is not solely profits or units sold. Most important is potential for future growth. Investors want to later sell their shares for more than they bought them, not the same price. Apple doesn't pay any meaningful dividends, so investors rely on capital gains from the stock price, which heavily rely on future growth.

For example, let's suppose AAPL is $400 per share. For the next 20 years, they make $10 billion profit per quarter. No less, no more. Those are profits most companies would kill for. But, does the stock price rise/grow? With no dividends being paid out, are investors likely to buy or sell? And how will this affect price?

As for "wall street estimates", I have no opinion on them and never made any assertions on them, so don't know why you brought them up.

 

[AidenShaw]

Or they need to raise the dividend appreciably. They can't do the latter because of current corporate tax law.

You mean that Apple *won't* do that because they don't want to fulfill their obligation to pay the taxes due on their profits.

 

[Stella]

What goes Up *must* come down. At some point.

Having SJ of course was good for Apple, but its a double edged sword.. he dominated Apple too much - he "was" Apple.

When Apple start releasing more products again I'm sure the share price will rise. iPhones are still popular, Macs are still out performing the PC market etc.

If the new mobile processors were released in March like previous years we'd see new Macbooks by now and the product lull wouldn't seem as bad. No Time Machine update - waiting for the next iteration of Wifi standard.

Unfortunate timing.

The Sky is not falling.

 

[TallManNY]

Couldn't they also hold them for future employee options rather than destroy and later re-issue?

Yes, and companies do that. But I think the shares are sort of inactive when they are held by the company. Again having the company vote its shares to tell itself what to do doesn't make sense. It also doesn't make sense if the company issues a dividend and then that dividend goes back into the company. But sometimes if a company knows it is going to need shares fairly soon, when it does a buyback it holds them. Apple might do this since it can use the shares as part of the compensation for certain employees.

Remember, the company can issue shares whenever it wants. So it isn't buying shares off the market so it can have shares. It can make new ones just like it issued the millions of shares earlier. You buy shares off the market so that the remaining shares are less diluted. This concentrates the ownership position of the remaining outstanding shares.