Site icon MacDailyNews

Horace Dediu: Investors should expect a 40% drop in Apple shares at any time and for no reason

Martin Bryant has interviewed Horace Dediu for The Next Web.

A few snippets:

TNW: What makes a good analyst and how are analysts’ predictions different in importance from those of a good tech blogger?

Dediu: Apple analysts vary. If you refer to ‘sell-side’ analysts who are working for financial services companies, their paychecks are not tied to accuracy or foresight. They are sold as a resource to clients of the firm and their work is meant to manage client expectations. They depend on access to management and supply chain managers for any differentiation. It is not a recipe for understanding a company’s resources, processes or priorities… There are other observers who are often more insightful. They are not called analysts because they don’t have that job title. They are bloggers or people who may have worked in the industry and can make informed opinions. They are typically more insightful because they are motivated to provide accurate predictions to establish credibility and reputation with a wide audience who is not expected to pay for their work.

TNW: There has been much talk recently on the ‘decline’ of Apple, as reflected in its stock price. What’s your take on this ‘decline’ and the suggestions that Tim Cook should be fired?

Dediu: My rule of thumb is that investors should expect a 40% drop in Apple shares at any time and for no reason. Warren Buffet seems to agree. There can be a long discussion about why that is but I think it suffices to say that there are too many institutional owners, and hence too much concentration of homogeneous thought about the company. Anyone suggesting Tim Cook should be fired is a neophyte.

Read more in the full article here.

Exit mobile version