“Apple’s renaissance began with the iPod. This was not evident right away however. The product was unveiled on October 23, 2001 at a time when Apple’s share price had just fallen 70% from year-earlier levels. It was perhaps a good point from which one could expect a recovery to begin,” Horace Dediu reports for Asymco. “It was not to be. One year after the iPod’s launch the stock price had fallen another 20%. Indeed during 2001 the company was in the throes of a “bear market” in its shares. If we measure a time of persistent share price reduction as a bear market, then the one in 2001 was significant. For 154 days, between April 27 and September 28, 2001 the shares fell 38%.”
Dediu then chronicles 13 “bear markets” for Apple stock, beginning on From April 27th 2001 until today.
“Sounds dramatic. The even more dramatic twist is that in this same time frame the share price increased by 576 points or the equivalent of 6,294%. Nevertheless, there were 13 episodes when the shares dropped violently and sometimes persistently for long periods,” Dediu reports. “Apple went from being irrelevant to being too big without passing through being boring. So there is a simple explanation for occasional panic: Apple is not predictable.”
Dediu reports, “At least since the iPhone launched, every dramatic drop in share price was followed by a surge in earnings growth. One could even say the worse the bear, the better the growth… When Apple’s performance is foreseeable the stock moves slowly upward. When its performance is unforeseeable the stock moves dramatically downward. A pithy way of putting it is: No news is good news. Good news is bad news.”
Much more, including the usual excellent explanatory graphs, in the full article here.
[Thanks to MacDailyNews Readers “Dan K.” and “Brian” for the heads up.]
And through it all I keep buying every month. Dollar cost averaging works with a great company.
Deidu and Zaky are Apple’s most credible forecasters as borne out by their track records
Lately, there has been no good news for Apple so Apple must be doing great (internally).
“So there is a simple explanation for occasional panic: Apple is not predictable.”
Apple is very predictable. It the stock trolls er anal….. yst that drive the stock in weird gyrations. OH, only weird if you are not part of the in crowd that sell high and buy low.
Just a thought.
don’t forget: Apple announced a stock buy back plan a couple quarters ago – this is a wonderful cheap opportunity for them to acquire their stocks at a huge discount.
Ahem: you should too.