Thursday, January 24, 2013
Apple (AAPL) Shares Close Down 12 Percent on Slowdown Worries
Apple shares fell 12% by the end of trading on Thursday. Wall Street's expectations were just too ambitious - investors expect too much from this company. Apple was hoping to sell 50 million iPhones, but they only reached 47.8 million. The "lackluster" iPhone sales is one of the primary reasons the stock fell so hard today. However, they only sold 37 million in the same quarter a year ago. According to my calculations, thats an increase of 10.8 million iPhones sold - sounds pretty good to me. I understand falling short of expected iPhone sales can be very disappointing, but investors need to look at the overall health of the company. Apple has 137 billion dollars of cash available. Their profits topped 41.7 billion, a record for any firm outside the oil industry. People keep talking about how the company desperately needs to get their Apple TV out to the market; those people need to relax. In my opinion, they are in good shape whether that happens of not.
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I "invested" in Apple last semester for my Financial Management project and they went down a ridiculous amount. At the beginning it was a steady increase getting above 700 for a little bit but then went down a lot and lost me a lot of money in my project. A lot of it was due to low confidence after the death of Steve Jobs but as this article said a lot had to do with sales as well. Apple TV was a bust for the most part I learned and after reading this it looks as if other sales weren't as high as they wanted either. Such a big company though I would not be surprised to see them climb back up the ladder.
ReplyDeleteWell for me it seems that the threat of the competition is what is making investors hesitant. Products from competitors, especially Samsung are at least on par, if nor superior, technologically and the consumers are starting to pick up on that. The tablet market is also getting saturated with quality products which might further be maing investors hesitant.
ReplyDeleteApple is losing ground in the smartphone market to Samsung. Apple still has a strong hold on the tablet market. Investors know this, but what they don't know, and what they want to know is what the future holds for Apple as an innovator. Creativity is at the core (no pun intended) of Apple as a company. The 12% drop in share value is investors way of showing that they are uncertain of when or if Apple will be the first in the industry to come up with another WOW product.
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