Wall Street logic: We were wrong on Apple yet again, let’s punish them!

“In the past three months, Apple set new sales and profit records for the quarter and wrapped up a fiscal year in which it blew past the $100 billion mark,” David Goldman reports for CNNMoney. “It sold an all-time record number of Macs and iPads.”

Goldman reports, “It sounds strange, but this is what a bad quarter for Apple looks like.”

“Despite those records, Apple’s revenue and earnings this quarter fell far short of Wall Street’s forecasts,” Goldman reports.

MacDailyNews Take: Wall Street’s been undershooting for seven years now. Now they’ve finally overshot. Either way, they still can’t get it right. The two greatest jobs in the world: Weather forecaster and Wall Street analyst. No accountability and you just keep getting paid.

“Those numbers disappointed investors expecting more, and shares of Apple fell 7% after hours,” Goldman reports. “At the market’s close Tuesday, the stock had finished regular trading at an all-time high of $422.24.”

“The Cupertino, Calif.-based company said its net income for the quarter rose to $6.6 billion, or $7.05 per share, up 54% from a year earlier,” Goldman reports. “Analysts polled by Thomson Reuters had forecast earnings of $7.39 per share. Apple’s sales rose 39% to $28.3 billion, but badly missed analysts’ estimates of $29.7 billion. The company’s sales for its full fiscal year, which ended Sept. 24, were $108.2 billion — a giant leap ahead of the $65.2 billion Apple raked in last year, but short of the $109.5 billion Wall Street forecast.”

MacDailyNews Note: On July 19, 2011, Peter Oppenheimer, Apple’s CFO, gave Q411 guidance of “revenue of about $25 billion” and “diluted earnings per share of about $5.50.”

Goldman reports, “Apple also finished the quarter with an ungodly $81.6 billion in cash, which the company said it intends to hang onto for possible acquisitions or unexpected bumps in the road.”

Read more in the full article here.

MacDailyNews Take: As of 6:23PM EDT, AAPL shares are off $27.04 (-6.40%) to $395.20 in after-hours trading. Anyone praying that the panic deepens or at least lasts until tomorrow’s open? Ready to back up the truck to fill it with discount AAPL shares?

Related articles:
Wall Street got ahead of itself on Apple; shares plummet in after-hours trading – October 18, 2011
Apple posts record revenue of $28.27 billion, misses Street expectations for first time since 2004 – October 18, 2011

39 Comments

  1. “Apple’s sales rose 39% to $28.3 billion. The company’s sales for its full fiscal year, which ended Sept. 24, were $108.2 billion — a giant leap ahead of the $65.2 billion Apple raked in last year. Apple again edged out Exxon Mobil to be the stock market’s most valuable company in the world.”

    “Apple sold more than 17 million iPhones. The iPad and Mac both set sales records during the quarter. IPad sales rose to 11.1 million, and Mac sales soared 4.89 million — the first time Apple has even sold more than 4 million Macs in a quarter.”

    That’s some AMAZING news, yet Wall Street Analysts are setting the stage for how this plays out. Wall Street Analysts EXPECTATIONS (& possible manipulations) are what’s driving the price of the stock and NOT REALITY. What does that tell you?? #OWS

  2. Good call MDN. If it can stay down at the open tomorrow it will be a good opportunity to move in. I predict another great buying opportunity in November, when rampant rumors will precede a MacBook Pro update and the real product will “disappoint”. This will be repeated next year with the new iPad, and the next iPhone…

        1. Wrong. It’s exactly because they are clueless that they’re down there protesting. All they know is the grass is greener on the other side, even though they have no idea which side they want or where it is.

  3. Most “analysts” are clueless. And investors who rely on analysts are even more clueless. I laugh at the ones who bought at yesterday at $420 and sell in panic tomorrow below $400. Even a buy at $420 will be richly rewarded long term.

    Excluding the expectation of those clueless analysts, Apple had another record-breaking quarter, with NO revenue from the usual (since 2007) new iPhone model release.

    Next quarter will have the ENTIRE iPhone 4S new release revenue, plus it is one week longer (at 14 weeks) than usual this year. Those analysts will be apprehensive after overshooting this time, and they will be conservative again.

  4. Scr*w the anal-ysts. What the heck is wrong here? Apple is rocking-n-rollin and they take a beating because the experts guessed wrong. I am “all in” with Apple, thank you.

    1. I was All-in twice. Once when Jobs became the iCEO and unwrapped the iMac, and the second time when the stock market crashed in 08 and Apple was under $90…. Ever have the nuts in poker, go all in, but only have a few chips left to go all in with? That’s me. 🙂 Royal Flush with $2 in chips.

  5. So, when Apple makes more than the street expects – the stock drops. When Apple makes less than the street expects – the stock drops. I’m thinking that Apple should stop announcing their earnings. Sadly, the one thing that does not seem to occupy Wall Street … Logic.

  6. Analysts counted in an iPhone 4 successor, which did not materialize in Q4. All expected iPhone revenue is just transferred to Q1 and that’s all folks. Nothing to worry about. Only dumb whiners and douchebags sold AAPL after hours for cheap.

  7. The Street got tired of being so thoroughly embarrassed every quarter that they applied the same amount of thought to this quarter’s estimates, the only difference being that they upped their guesses by 25%. They didn’t take into account where Apple is in their product cycle any more than they usually do.

    Watch these clown scale back their estimates again for the holiday quarter and have Apple blow them out of the water.

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