“Zabitsky, who founded his research firm Active Communications Integration in 1997 to consult the telecom industry and institutional investors, believes one of the most-favored stocks on Wall Street will decline nearly 50 percent because of competition from phones using Google’s Android software and because of a double dip in the American economy that will hit luxury brands as a consumer and government debt bubble bursts,” Melloy reports. “‘Apple is a luxury brand and in the past has correlated very well with LVMH Moet Hennessy and Christian Dior,’ said Zabitsky, who is based in Toronto, in an interview today. ‘America didn’t get rid of the bad debt, the government just took it over and consumer credit is trending down.’”
Melloy reports, “To put his $126 target in perspective, the average forecast from Wall Street analysts is $300.”
For what it’s worth, Zabitsky declined to reveal his models that get him to the $126 figure, but said it was based on much lower iPhone prices hitting margins. The increasing capabilities of phones made by HTC and the end of the AT&T exclusivity contract will be the catalyst for that plummeting profitability. When the iPhone came out it was grossly different,’ added the analyst. ‘Apple has raised the bar on what’s normal, but other phones are easily narrowing the difference because web technology is easier to program.'”
Full article here.
MacDailyNews Take: Oh, happy day! Our search for the new Laura has finally ended! Eddie, you’ve been iCal’ed with a bullet!
In the full article, Pete Najarian, co-founder of OptionsMonster.com and TradeMonster.com, said it best, “If he is right and economic circumstances cause Apple to drop to $126, we’ve got much bigger problems to worry about than that.”
How can these people call themselves ‘analyst’ if they are not able to analyze properly. This guy does not understand Apple.
Najarian is spot on.
And there ARE other things to worry about CLEARLY.
The Greek debt crisis is likely to spread and may drive the euro down further which only makes sales for Apple in Europe (there’s already a 25% price bump for the ipad in the UK) worse.
The commercial real estate market is just about to get hit with all the credit default swap paper that’s been in the wings the last couple of years which is NOT good.
But…these are ultimately just parts of the longer cycle…so hang in if you can.
And this is what the Fed regulators should be looking at…jeez, a sleep at the wheel.
If Apple Drops to 126.00 the Market as a whole will be so far down that everything is going to be basically worthless, including Google, Microsoft, Adobe and all the rest. But, when a company is doing good everyone wants to use it to get their 15 mins of fame.
let’s see….no debt, $40+Billion cash on hand, more coming in every month….I will take any shares being offered at $126
126 is too high. Think of all the mistakes Apple has been making lately. The iPhone is barely selling anywhere. And the iPad intro was met with a yawn. And they have noooo coherent content strategy to speak of — it’s just a patchwork of false starts (ie iTunes music and TV and movies). This guy should be hung for not going low enough.
@Pink
Wow…that’s almost as amusing as our compatriot ZuneTang’s silly ramblings!
I’m going chalk your post down as a weak attempt at satire.
“‘Apple is a luxury brand and in the past has correlated very well with LVMH Moet Hennessy and Christian Dior,’ said Zabitsky.
Odd to say. From autumn ’08 through early ’10, while so many luxury brands were down, Apple sales kept pushing substantially higher. The most common description of the company has been “recession-proof.”
For an analyst looking for attention, this may seem like a clever call, but won’t look so good after while when MDN pulls up the iCal.
@PR Thank you for that ringing endorsement of my POV!
Our society is fundamentally broken at it’s core. The reserve banking system has made it so more dollars are owed than exist in the world. they are running out of financial bubbles to inflate and pop… one day it will all fall down.
it’s been a good run, but this century will see the end of this cycle of humanity. And that, IMO, is a good thing. whatever is next has to be better than what we’ve been doing as a species up to now.
Until then, I’m gonna just enjoy my Apple products and not worry.
He’s Canadian right? Probably heavily invested in RIM right? Just sayin’.
@Zaphod Now that’s the kind of thinking that made Apple the company it is now. You know, that never die attitude. Ahh, like a breath of fresh air in the current climate.
“There is really nothing you must be. And there is nothing you must do. There is really nothing you must have*. And there is nothing you must know. There is really nothing you must become. However, it helps to understand that fire burns, and when it rains, the earth gets wet…”
*We can all be Zen once we have our (cough, cough) Apple products.
Apple haters are everywhere, I’ve gotten pretty expert at tuning them out completely. Too bad the stock will be hit but it has more to do with global economics than yet another Nokia lawsuit or some comment from Nintendo. They can’t beat the innovation and design expertise so they clog up the courts. Whatever.
The best thing about being integrated into the Apple tech ecosystem is that stuff works. It’s not like these things will stop working when the stock fluctuates.
Can you say “buying opportunity” ??? lol If AAPL drops that much, I’ll be looking to buy as much as I can afford.
As the future and health of the American economy will be increasingly reliant on the Apples and innovators of this World (which means mainly Apple) then if it hits that price Obama or his successor will be flying off to China in their re-commissioned Airforce One Dakota to beg a rescue package while shitting themselves in fear wondering if they have enough juice to overfly the waiting Somali pirates on route.
I’m guessing Kreskin of Wall Street called the great meltdown of 07-8 before it happened and called the bottom of the market. No?
Didn’t think so- not many did.
Someone needs to tell Junior that Apple is solid on the fundamentals, has no debt, has a full pipeline of future product and has the leanest supply chain in the business. Well I guess Kreskin didn’t know/consider all of that.
Ladies & Gents- this effing Wall Street troll is precisely the kind of leech that is destroying American enterprise:
1 He produces nothing of value.
2 What he does produce is pulled out of his ass and is wrong.
3 At the end of the day he gets paid even when he guides you wrong.
He works in Toronto, ON, Canada.
Living at The Center of the Universe does funny things to the cognitive functions.
You wouldn’t laugh and point at a special needs child on the short bus. Please show some semblance of decorum.
1. Work hard for your money and don’t join collectives that artificially inflate the value of your work beyond all semblance of reason. You weld together cars. You don’t deserve a summer lake house. You should have studied in school like the smart kids.
2. Stop reproducing if you’re a stupid fsck and especially if you’re married to another stupid fsck. Go rent Idiocracy instead.
3. Eliminate most government entitlements and artificial subsidies, they’re wrecking the economy, stifling innovation, killing families, etc.
4. Give generously to charities. They make the most effective aid to those who cannot help themselves, not government. Government is inefficient and corrupt.
5. Get some morals/restore society’s ability to castigate. It is not okay to have babies out of wedlock. It is not okay to suck off government programs if you can provide for yourself. It is not okay to eat like a pig, get heart disease and expect your neighbor to pay your hospital bills. Etc., etc. etc.
6. Deport illegal aliens. They are illegal. Enforce the law.
7. Secularism and government dependency will kill America as surely as it’s killing Greece today.
“the end of the AT&T;exclusivity contract will be the catalyst for that plummeting profitability.”
WTF?!?!?!?!??!?!?!?!?!?!?!?!?!?
I think Mr. Zabitsky forgot who he was writing about.
Secularism is what made America great. The breech of the wall of separation between state and church by Bush is what started this horrible decline.
There are no “investors” in AAPL. Only opportunists. As soon as they think Steve has run out of the next magical gadget, they will sell. Get ready.
If Steve would publicly and honestly commit to the future of the Mac, that might change things. But, instead, he has declared that Apple is a “mobile device company” so what you see is what you get. And, you don’t see new Macs or new OS to run them.
The problem is too much regulation. All you Left Wing pinkos want to do is give money away and regulate the free market. If you let people make billions of dollars on the stock market then all this money will trickle all the way down to the rest of us and even the homeless folks and we’ll all live in prosperity. The American Dream. It’s all about the Free Market. For a Market to be free, it must be totally unregulated.
In the day of rumor and innuendo the neanderthal is king.
Even the foolish analysts agree that the end of the AT&T;exclusivity will enhance iPhone sales. See the experience in Canada, Europe, etc.
@ Swing Geezer: I can’t wait to be homeless and wait for those billions to make their way down to me. A true free market is one where there is true competition without oligopolies.
Master investor Peter Lynch said it well when he explained that the market value (price) of a stock will always track the company’s earnings – eventually. There is not a day-to-day correlation. But eventually, if you look at a historical chart of a stock’s price INCLUDING a chart of the stock’s earnings, the two lines will correlate. When the price dips beneath the earnings line, it creates a buying opportunity.
(NOTE: I am NOT a technical trader. I believe in fundamentals only, not hocus-pocus of “teacup handles” and other flights of bizarre fantasy. But a chart can provide a follower of a company’s fundamentals with a useful look at how a stock performs versus its earnings.)
With Apple, you have to also factor in that the company has no long-term debt, as well as its large amount of cash. This reduces the price to earnings ratio of Apple stock considerably.
Unfortunately, for a day or so, idiots (or mean-spirited short sellers like this bozo, who actually appears to be both) get to unduly influence some market sentiment. But it is earnings more than anything else that establishes the value of a company’s stock. And that cannot be denied by jerks like this dork. Eventually, he will be proven wrong.
In short, be patient. You will be vindicated, and this idiot, after there is a margin call on his short-selling activity, will be in full retreat.
Stuff like this makes my head hurt.
@swing
Another poor satire? If not, please name ONE country in the world (in the history of the world) in which unregulated free market policy has produced a libertarian utopia.
Greece/Portugal/Spain/Ireland are all very close to insolvent. But not all western european countries with social safety nets are in economic despair. Denmark is in no danger, Germany’s unemployment is less than 5%. Why are these countries better off than their peers? They never bought into the ridiculous free trade/free market ideology their peers adopted. And they have strong unions to to protect wages and thus create demand in their markets.
MDN Magic Word: research
Why do people pay attention to these idiots?
Sounds to me like this moron Zabitsky, bought at the wrong time and is trying to influence the stock & recoup some losses.
I hope that he loses his shirt.
Poor guy doesn’t have a clue.
EDWARD ZABITSKY
Another target on the Tard Radar Screen.
Where do these nitwits come from?
Reminder: Apple is one of the few companies to not only be profitable, but to be consistently GROWING at an historic rate during the ongoing Bush Depression. Therefore, it’s stock is going to halve. Cue the jibbering village idiot.
I am typically on the side that says that Apple is over priced right now. Apple is big, but it’s not the second most valuable company in the world.
That said, $126 is a ridiculous price. Honestly I would put them at around $200. I know the iPad is selling well right now, but it’s no iPhone.$230 seems high to me, $126 is ridiculous. I’ld say $200 for AAPL.
When you’re asleep at the terminal all day looking at porn, you may find it difficult to put two and two together; that one day after a 900 point drop on the dow, a 50 point kick down in a well managed tech company with a 20 minute reversal to the upside, there is a man outside the shores of America calling for Apple to go to the 120’s.
This, with what has to be the greatest phone ever to be released coming in about 4 weeks. How much porn can you be watching not to see the that something is up? Surely it can’t be S.E.C.S, oops, the SEC.
A market that has zero regulation is simply criminal.
Everything needs regulation.
Civilisation is what regulation is usually called.
We regulate ourselves so that we dont go to excess.
You want a free-for-all? Go to some bar and start a drunken brawl.
Free market? Doesnt exist – never has, never will.
@ Wrong again
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Well… your name says it all: Wrong again
@ Dallasm
the price is actually an indicator of future expectations beyond the iPad, i.e. where Apple is going to be a few (or many) years from now. Also, the value is based on Apples performance compared to other companies, hence 200 would be a gross underestimation.
“The iPad is no iPhone…”
No, it´s the new computer (as in replacing everything that came before it). For most consumers it will be just that.
I just have to write a few more lines
@Wrong again
“If Steve would publicly and honestly commit to the future of the Mac…”
If Steve would honestly commit to the floppy disk and not scare us with all those new things that force us to learn new stuff… and alter existing production lines… then we could call him a visionary!
The future is – obviously – a place where everyone have huge boxes on their desktops (like the crt monitors used to be). No one wants to have his/her data with them when moving away from the desk…
—
You can´t plan the future of computing (or anything else for that matter) based on listing – and keeping – what you THINK are features, but actually are nothing but physical restrictions of today/yesterday (desktop, floppy, usb…)
Those are the things you (should) want to get rid of.
Whatever shape or form it may take, one thing is certain:
the future Mac WILL BE a mobile device.
Steve is very much committing to the future of the Mac – it might just be beyond your present comfort zone.
HAHAHAHHAHAHAHAHAAHAHHAAHHAAHAH
It never ends!!! These know nothing anylists are making me rich!!
Clueless doofus. Monday 5/10, pre-market ,Apple is trading up $12 a share at $247 from Friday’s closing price of $235. People know this one’s a bargain.
Maybe Katy has some competition!
It’s now Jan 26, 2012. Let’s see how Zabitsky did with his prediction. He advised selling AAPL short on May 7, 2010. I track the closing price of AAPL. The minimum it closed at from May 7, 2010 to today was $235.86, which was the closing price on May 7, 2010. In other words, AAPL NEVER closed below its closing price for that day. Today, it closed at $444.63, an 88% increase and 252% above his prediction of $126. Zabitsky should take up another career, perhaps holding the Stop-Slow sign at road construction sites.
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