“Even Apple Computer, it seems, can’t defy Newton’s laws forever. Shares of the company traded off as much as 7% Monday and are off some 22% since hitting an all-time high last month. The selloff follows a three-year run that has sent Apple shares up more than 900%,” Troy Wolverton reports TheStreet.com. “Analysts and traders were at a loss to explain the immediate cause for the stock’s Monday decline. But more broadly, a number of recent developments have made investors nervous, leading them to cash in on the stock in recent sessions, analysts said. ‘Everyone’s question now is how much more upside there is in Apple’s products,’ says Tim Biggam, chief options strategist with Man Securities. ‘There’s some pretty hard profit-taking’ going on, added Biggamn. ‘A lot of longs have gotten nervous.'”
MacDailyNews Take: Everyone? Or just those with a desire to see a lower share price?
Wolverton continues, “Investors have had to deal with a growing list of concerns. While sales of the company’s iPod digital music players in the holiday quarter topped nearly everyone’s expectations, the company predicted a sharp decline in sales this quarter.”
MacDailyNews Take: Yes, it’s a shame they canceled Christmas in March this year.
Wolverton continues, “…The company cautioned investors that because of its transition to computers based on Intel’s processors, computer sales could continue to be soft in the current, or second, quarter [and] some analysts and investors have worried about the impact on Apple of the proposed sale of Pixar to Disney… Analysts have also worried that the Disney position might distract Jobs — who is widely viewed as having saved Apple from irrelevance or death — from his duties at Apple… Another concern is the past weekend’s column in The New York Times that denounced Apple’s iPods as being fragile devices with a short, useful life and that accused Apple of having poor customer service.
“Last month, Apple, for instance, was trading at about a quarter of Microsoft’s, valuation, says one hedge fund manager, who asked not to be named,” Wolverton writes. “But Apple’s earnings and revenue constitute a much smaller fraction of Microsoft’s than that. ‘There’s no way you could say this business model is as good as Microsoft’s or two doubles away,’ says the hedge fund manager, who is long Apple’s shares but recently sold off 90% of his stake. The opinion of investors seems to be ‘take the money and run,’ said the fund manager. ‘A lot of people are just doing that.'”
Full article here.
MacDailyNews Take: So many worries, nerves, and concerns. Drive it just a little bit lower, guys, please? This is classic. Massaging a Correction 101? Prospective AAPL investors who believe, despite the many “worries,” “nerves,” and “concerns,” that Apple has a strong future should be salivating soon, if not right now.
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