“Of all the tech giants who took a beating in Monday’s stock market meltdown, Apple suffered the worst, dropping 18 percent,” Brian X. Chen reports for Wired.
“What does it mean for Apple? Absolutely nothing, explains Oppenheimer & Company analyst Yair Reiner,” Chen reports. “‘I respect someone coming to the conclusion that the economy is going to turn very sour and Apple may be among the chief casualties of that,’ said Reiner, in a phone interview. ‘But I think that’s a really short-term call.'”
Chen reports, “Reiner said Apple’s stock crash isn’t going to decrease production of iPhones, MacBooks, MacBook Pros or cancel the development of a hot new product.”
Chen reports, “The only way Apple’s falling share price might have an impact is if the company needed the capital to expand or make dramatic changes, which would require raising money by offering more shares. And that isn’t likely, because Apple has upward of $20 billion in its balance sheet, and the company is still trading at 21 times its earnings for 2008, Reiner said.”
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Katie Marsal reports for AppleInsider, “Even as stocks melted down on Monday and fears of tough recession set in, analysts at Piper Jaffray held strong to their Buy rating on shares of Apple, saying the company remains the best positioned amongst its peers to weather the economic storm. ‘We recognize investors do not see light at the end of the tunnel as market fears appear to be outweighing fundamental analysis,’ analyst Gene Munster wrote in a note to clients.”
“Munster remains confident in his outlook for the Cupertino-based company and offered a number of supporting arguments… ‘Our analysis of two months of NPD data on Mac and iPod, which has a 0.90 correlation, suggests 5 percent upside to Street numbers,'” Marsal reports.
Marsal reports, “The analyst maintained his Buy rating and $250 price target on shares of the company, as well as its place on his firm’s Alpha List. ‘We believe fears of a continued global slowdown will impact equity investments in the tech sector,’ he wrote. ‘But our thesis leads us to conclude that Apple is better positioned than other tech players to weather the storm.'”
Full article here.