Howard Gold: Apple shares will never see $700 again

“Last September was a great time to be an Apple Inc. shareholder. The stock topped $700, capping a remarkable run in which the shares practically doubled since July 2011,” Howard Gold writes for MarketWatch. “It’s been downhill ever since. From its closing peak of $702.10, Apple shares plunged by 37.4% as of last Friday, when it closed at $439.88. The stock has bounced back a bit, but when the world’s most valuable company loses that much in just four months, something must be seriously wrong.”

“It is. Apple’s competitive position has seriously weakened, and investors are recalibrating their outlooks. Tailwinds have turned into headwinds as tangible and intangible issues alike weigh heavily on the shares,” Gold writes. “Apple has lost the mantle of the greatest growth stock of our era; it may no longer be a growth stock at all.”

Here are four reasons why I don’t think Apple’s stock will see $700 again:
1. Growth in phones is slowing as competition increases
2. Margins are shrinking
3. Apple is losing its innovative edge
4. Apple may no longer be a growth story

Gold writes, “CEO Cook may be quietly repositioning Apple as a solid blue-chip stock. That would be a big blow both to Apple’s image and to the cultists who worship the company. A dividend-paying Apple that buys back its stock like, say, IBM IBM +0.99% might be a fine long-term investment, but it wouldn’t be worth $700 a share.”

Read more in the full article here.

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57 Comments

  1. “Tailwinds have turned into headwinds as tangible and intangible issues alike weigh heavily on the shares”

    You only write such fluffy bullshit when you have nothing serious to write about, but only an intense will or incentive to spit out negativity.

  2. At 700 AAPL had a PER if 14.x. IBM has a PER of 22. If AAPL becomes another IBM it’s shares should go to we’ll over $1000, no? Methinks Mr Gold’s opinion is fool’s gold.

  3. It is what we in England call a load of B. S. Apple do not just make phones, Tim Cook is not the only employee at Apple and Steve Jobs will have left 3 to 5 years worth of forward thinking. Good luck to Howard Gold’s clients, you have picked a real winner in him “not”. I do not know his track record, but as an Apple customer since 1988 I think I probably know better!
    Their is the Lytro tie-up , a new Apple television, iTunes!, Macs, iPod, I could go on be what is the point, AAPL will rise. Howard Gold and his kind help the market drop and some make vast sums on silly rumour or market jitters.

  4. Dear Howard
    How do I invest all my precious gold with you. Your so smart. I’m so exited to have finally found my way to riches.

    I’ve just sold all my apples that I bought in September under the advice of that smart man on tv. I was so sure he would be right as he has his own show. They turned mushy. Something about my storage was too small.

    Since you know so much about headwinds and tailwinds I’m sure you’ll know the way. And your insight that because apple has competed so hard to take most of the profits must mean that there is no more profits left to take.

  5. Anytime someone says something will “never” happen, you can be assured it will.

    No one will ever break Roger Maris’ home run record.

    No one will ever dive to the sea floor.

    No one will ever skydive more than 20 miles.

    The only questions is when, not if. Apple comes out with an amazing Apple iTV, or iGlasses, or iOS designed to drive your car all by itself, etc. etc. and the stock will soar even higher than $700.

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