Payback? Wall Street didn’t like Apple passing Dell in market value

“As everyone knows, Apple Computer has been on quite a tear in recent years. So how come this high-flying stock has lost some altitude? Just a few weeks ago, the much lionized maker of iPods and Macs eclipsed the $72 billion market cap of Dell. That was quite a feat since Dell’s sales dwarf Apple’s by four to one. Well, the giddiness didn’t last long. As of Feb. 8, Apple’s stock had fallen 20% from its Jan. 13 high of $85.59. Did the news that Apple had passed Dell tell investors that the stock was getting ahead of itself? That may be part of it. More likely, investors are bailing out over concerns of slower-than-expected demand for Apple’s new Intel-equipped Macintoshes. Factor in, too, the sense among Macolytes and investors that Steve Jobs’s next big product introduction may be several months away. Even lower-priced iPods, unveiled Feb. 7, failed to lift the stock north of $70,” Robin Ajello writes for BusinessWeek.

Full article here.
Steve Jobs’ leaked email probably didn’t help, either.

Nothing has changed. Apple’s guidance for the upcoming quarter remains as stated and as the second-best in company history. Apple remains strongly positioned for future growth. All that has changed are nebulous reports of “slower-than-expected” demand and other “concerns” – all backed up with no proof. Precisely as things were last July when “concerns” raged that iPod demand had peaked, until the actual earnings were reported which showed that Apple’s iPod shipments rose to a then-record 6.16 million. Do you really think that the “concerned” were “surprised” about that?

It’s a game. If you’re going to play, play it well.

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Related articles:
Analyst: Apple to unveil Intel-based iBooks, ‘real’ video iPod at special event in April – February 09, 2006
RUMOR: True Apple video iPod with 3.5-inch display, touch-screen click wheel coming soon – February 09, 2006
Analyst: Wall Street’s worries of slowing Apple Intel-based Mac demand are ‘absurd’ – February 06, 2006
Apple Mac is #1 in European education market, pushes Dell down into second place – February 03, 2006
BusinessWeek: How can Apple be worth more than Dell? – January 20, 2006
Steve Jobs emails Apple team: Michael Dell not the best prognosticator, Apple worth more than Dell – January 16, 2006
Apple now worth more than Dell – January 13, 2006

25 Comments

  1. It’s also called the “pump and dump.” Once the stock hit $85, the asshats cashed in and started to poo-poo the stock. Now that it’s back down to $65, they’ll start buying it up again and pumping it back up. And the same cycle will occur again 6-8 months from now and so on…

  2. I think this is to ensure we don’t get too cocky, which I think is what happened.

    Same goes for OS X viruses too. MDN (and others) are far too cocky. Just “shurrup” and don’t let on!!

    More seriously, it was likely the guidance which caused the drop, and a correction was needed, but $20… sheesh. Google’s not as high either, they’re down around $100 from their recent high too.

  3. This pullback comes as no surprise. You need to learn to play the market Game. Company after company gets hammered when they don”t report inline with their previous guidance. Apple is known for playing it safe. They say they don’t expect to meet the earnings estimates, sales are slower than expectd, etc, etc, yet blow the numbers out of the water almost every time for the most part. Why? If fate takes a sudden turn for the worse, you can’t be sued if you’ve warned. Call it protection.

    From a techincal analysis pov, the chart showed AAPL was due for a pullback, with a target of 65.00. I place a limit order for 65 a week ago. Guess what? It was hit today. For those interested in technical analysis software for the mac… look at Trendsoft.com and/or BeeSoft.net

    I’ve been trading full time for almost 9 years now. There is no better way to make a living if you can control a traders worst enemies; GREEED, FEAR and HOPE.

  4. As Steve would say, “it’s called a cycle”.

    In stocks, the money goes wherever the best returns are. Investors don’t see great returns on Apple at the moment, so the money is going elsewhere. When the Intel transition is complete, and/or Steve pulls another “one more thing” surprise, we’ll see AAPL moving nicely again.

    Remember, MS and Dell have no where to go but down. That other 90% of the market is Apple’s to take.

  5. I told you to sell

    It’s just a normal stock adjustment, I was so sure I even shorted.

    Now I can buy that Quad.

    Whooo hooo whooo weee

    Human behavior is predictable you see.

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