“Apple has taken on the aura of a penny stock. Ironically, it reminds me of what Sirius XM used to be,” Rocco Pendola writes for TheStreet.
“I recall (Central Park in fall, how you tore your dress, what a mess?) an excellent video from July 2011 where Jim Cramer basically called SIRI’s turnaround. Since that appearance the stock has returned roughly 55%,” Pendola writes. “No two ways, man — it made me look bad as I was bearish, but that’s not what we’re here to talk about. Cramer made points that, oddly, we can now broadly apply to AAPL: ‘I would not tell people to avoid. I think you can have it as a speculative stock now… Because at the same time as it’s gotten its capital structure together, it’s owned by really bad hands. It’s owned by people who are flippers and traders and penny stock guys and I don’t like them as my colleagues when I own a stock.'”
“Flippers. Traders. And penny stock guys,” Pendola writes. “Of course, AAPL is a $500 stock so don’t take me literally; however, the conversations and antics now associated with it resemble the type of stuff we used to see regularly with SIRI and names such as Research in Motion, which deserve penny stock status, at least from a symbolic standpoint.”
Read more in the full article here.
Over the past three month (in fact, past five years), AAPL has been often behaving like a penny stock, with quite massive daily swings (up to 4%). How many here know of a large-cap stock, with a P/E in the low teens, exhibiting such heavy gyrations?
We all know Apple is a unique company whose business practices often defy common logic and where standard business rules simply don’t apply, but I can’t believe that the people who invest in its stock get so easily spooked by such unorthodox business practices. What’s worse is, all these large movements tend to happen on inconsequential days, when there are presumably no actionable news. At the end of the day, AAPL has grown extremely well and has rewarded its investors better than any other mainstream stock. But still…
Does anyone here have a reasonable explanation for this?
No but I would beware the The Ides of March because that statement is about as logical as any good soothsaying hack/analyst ever is.
2 words:
Market Manipulation.
You can manipulate penny stocks (where market cap is a million or two). Nobody has enough cash to manipulate a stock with a market cap of half a trillion (with a T) dollars. Not even Jim Cramer…
This manipulation is using misinformation and the new media echo chamber not pushing directly using capitol. We also some “unique” investors attracted to Apple by the huge growth in the later “post jobs” era. (I am astounded when I hear purported shareholders complain about ROI.)
It also helps (in this case) that there are so many people who for one reason or another hate apple and desperately want to see it falter (and there is no shortage of apple haters) Another contributing factor is you have a large company (goog) with huge power and capitol who need to derail or delay the rapid expansion of iOS that happens to have an army of bloogers (some directly paid some through indirect means) who are extremely loyal to google and additionally a great number of those are also apple haters.
It is really a “series of unfortunate coincidences” that allow the manipulation of a stock of this magnitude.
However, anyone with steady nerve can benefit greatly (financially) using this one simple rule, whenever they push it down; time to buy.
RIGHT ON THE NAIL
You have stock brokers on Wall street that would kill there mother and sell their kids to make another million.
There are no morals there and they want to do ANYTHING to drop prices down (while they short) then buy again when they know a stock is way under priced and ride it back up.
There is a very large group that do this in concert with the NY press that willingly print rumors and smear stories because they get a nice fat handshake.
Throw in counterfeit stocks and you can create a real big mess of a strong company.
I do, Predrag. It’s likely you have seen some of my posts in the last couple of months where I have explained exactly what is happening to AAPL and why. Every day, my explanations are confirmed by actual events in both the company and among AAPL investors. I won’t repeat them here even though denial among this site’s regulars run rampant as they struggle to find some reason for the collapse other than facing the reality of what has happened to Apple Inc. in the Tim Cook era – the fulfillment of Steve Jobs decision to convert the once great Apple to a “mobile device company.” Now facing competition from a shelf full of inferior, cheaper and multi features laden devices from every other phone, pad, and pod maker on earth, Cook & Co. are clueless of how to contend with the fickle market dominated by pop culture customers looking only for the next fad in this era of the gadget.
Seriously pp…, why do you post here? You seem relatively well-spoken, but it can’t really be the case that you believe much of what you write. “I have explained exactly what is happening to AAPL and why…” Are you really so delusional?
I have no problem with your take on AAPL, you are entitled to your opinion. However, I am curious how many millions you must have made the past 4 months by shorting the stock or buying put options. If you are so right, you would be stupid not to put money behind that opinion.
Your point may be valid if you had any data to support it. But there isn’t any.
Apple are selling more product than they have ever done in their history whilst maintaining fantastic margins.
The FUD that is being spread around is designed to drive the stock lower and it has succeeded very well. There is no real data to support it, just speculation. You and others have fallen for it hook, line and sinker.
You only have to look at Compaq, Dell and now HP to see what happens when companies go for market share and sacrifice margins. The market analysts are not sophisticated enough to understand that solid performance is much better than a temporary market share.
And get one thing straight. Without Cook, Apple success in the last 10 years would not have been possible. He has put together the most efficient machine for production of high quality goods. This has been the critical factor in Apple’s spectacular growth and sustained success.
Apple has been scaling the iPhone as fast as they could since 2007… samesung has been in the business for years… Apple can hardly keep up with demand for its phones, so it is stupid to expand to emerging markets when it cannot yet satisfy the high end markets… but 2013 and 2014 are a different story and the Apple will ramp to pass Samsung given enough time to double again without diluting the Apple Customer Experience.
This IS what’s really going on !
Apple, for me has never been about the stocks,
its about the products and software.
Such focus, over APPLE stock, saddens me.
Next cited resson for a stock price dip.. Even if its recited or referred to over a year from now…