Apple closes below $400, down 43.5% from September high

“For many Apple investors, the stock is only a couple of down days before it’s time to wash their hands of it. It’s easy to understand, when the news is full of reasons why you should sell and the shares are trading near 52-week lows,” Robert Weinstein writes for TheStreet. “Typically, when a stock is trading near 52-week lows, it’s a sell. After all, there’s a reason why investors are bailing out, and the market usually gets it right. But sometimes the market is wrong, and it isn’t changes in the fundamental business model that’s driving share price; it’s emotion and fear.”

“You’re making a substantial mistake if you underestimate the role emotion play in pricing securities. Emotion is especially influential during relatively short time periods. We see it every day in the market. A stock can gap higher at the open, fall below the previous day’s low, and then spring back to close at a new high,” Weinstein writes. “Obviously the underlying company didn’t change in value in a single day. In all likelihood, the company produced about the same amount of widgets as it made the day before and will make the next day. The force moving the share price is emotion, and while it’s easy to visualize its impact during a single day, investors should know that the same applies over the course of days and weeks.”

Weinstein writes, “Apple’s monthly chart has rising 60-, 90-, and 200-period moving averages. With a price near $400, the stock is also trading well above the moving average. What this tells me is that money continues to flow into Apple, but emotion during 2012 drove it too far too fast. In other words, once you remove most of the emotional drivers and ignore everything other than the core (sorry, bad pun), what you’re left with is a rising stock with solid fundamentals.”

Read more in the full article here.

51 Comments

  1. Who is selling AAPL? The big sellers are the ones who drive the price down. It would be interesting to know if they’re making money on a falling stock price. But we never will. No transparency on Wall Street.

      1. Whatever stock you buy today, you will lose on it tomorrow. Apple is not the only one. The entire world economy is in the doldrums. I blame high oil prices for the mess. Still, Apple is still making billions in profit every quarter, unlike others. Also, let’s not forget they are on a share buyback program. Low price means less shares on the market in future.

    1. Cook is doing fine. It’s the Hedge Fund D-bags that are destroying this stock. Apple keeps making historic profits but yet the company is “done” in the eyes of Wall Street so they can drive down the price and do it all over again.

      It really is pure evil. I wish all these Wall Street asshats an early, painful death.

    2. The truth of the matter is this, ladies and gentlemen: One of the many, MANY reasons we vilify Steve Ballmer on this site is that during his tenure at Microsoft, he has HALVED the value of the company he leads. That is a fact.

      The undeniable truth of the matter is also this: During his tenure at Apple Inc, Tim Cook has ALMOST halved the value of the company he leads.

      What is the difference here? Time, perhaps? I wonder.

    3. @AAPL Shareholder

      How much longer will Cook last at this rate?

      Instead of pushing your progressive agendas, how about doing your job for a change, Auntie Tim?

      Really??? You played the gay card?? What are you 12?
      I’m guessing yes.

  2. Apple will go to $200, and I own Apple. The current administration is working to destroy the private economy and doing a bang up job. Unemployment is at 10% counting those who have given up . Food stamps are at all time high. Student loan default are as well. Gas prices are double what they were when this President came into office. Now he is commanding power companies shut down perfectly good power plants. Taxes are up. Spying on individuals is now commonplace. Dead ambassadors are now something that “doesn’t make a difference” according to our former Secretary of State. The Pentagon now conducts weekly Gay Pride events. Muslims in the Army murder scores of soldiers at a US fort yelling Alahu Akbar and Obama calls it workplace violence. And he spends $120 million to go on one vacation. Now, it is proposed 12 million illegals be added to our federal welfare programs and the illegals be made citizens, which will bring down their current quality of life. Poverty and stupidity are the new normals brought to us by the big eared imbecile. Who is right now having my post tracked by the NSA.

    1. Bush’s trip to Africa cost a comparable figure. Taxes are less than they were under Reagan considering capital gains. Some thing like 50 people were killed in embassy attacks under GWB. While Bush was up, conservatives like Sean Hannity did nothing but sing NSA programs and the patriot act praise.

    2. Take away your first sentence, and your post has no place here. I owned AAPL, and sold in the 450s. Not that I lack faith in the company, or in Tim Cook, it’s just what the market is doing (reacting emotionally as stated) and where the company is right now (just reiterating current products mostly). I don’t have a long-term feel for where the company is going yet.

    3. Your first sentence shows you know nothing about how the system works.

      Apple’s Book Value is well over $200 a share. If AAPL gets within even 10% of Apple’s Book Value vultures will sweep and buy Apple with its own cash — thereby taking it off the market as AAPL.

      It’s just like years and years ago when Apple was trading at about $13 a share (pre splits). The Book Value was over $9 a share. A few very vocal analysts were claiming that the stock was going to go down to $7 or even $6 a share. How low did it go? About $12.30 or so. It never got within 10% of Book Value.

      Anyone who claims a publicly traded stock is going to go below Book Value — and that the company will still exist with the stock trading that low — knows nothing about how the market — and financial vultures — really works.

      1. I believe AAPL traded just above $7 per share in 2003. You know, where so many here claim to have bought APPL. And I’ll bet they were all at Woodstock too. Drove there in their 67 (427 SOHC) Cobra with road pipes. Blue.

        1. First of all GM I do have to say that I love reading your posts, you bring some good sense to people who may be investing. I’m talking of course about taking profits every now and then.

          That said I will let you know that I bought Apple prior to 2003 and that’s why this drop does not mean much to me right now. I’m in it for the long haul and with the dividend payback I’m making back my initial investment very nicely. That means for me at least the rest is icing on the cake.

          I can wait it out another 10 years (that’s my plan) and unless something goes awry I believe that the stock will be well over $700. Even if it doesn’t the dividend is nice and I doubt that the stock will tank at $200, maybe $350.

          The risk I take is a philosophical one. I had no doubt that the stock would take a hit after Jobs left. Why I continue to maintain my interest in this company is to see if the legacy, the spirit, the attitude, the DNA of Steve Jobs will persist. Frankly it’s still a bright spot on a sordid world.

          Once again, I do enjoy reading your posts. Thanks to you and others that make intelligent perspective comments at MDN this place is worth the visit and the read.

          1. It’s possible to be philosophical while still not losing money. Had you taken your profit last summer you’d be able to buy back in now, if you really wanted to, at a much better price. All the while watching the “spirit of Apple”. The spirit and DNA would be there regardless of whether or not you lost all that money. Especially since, as you say, you ” had no doubt that the stock would take a hit after Jobs left”. So if you knew you were going to lose all that money it’s a shame that you didn’t give it away to less fortunate souls. Benevolent and philosophical. What a combination! Or at least burned it in the front yard. You could have roasted marshmallows with all the neighborhood kids. How impressive. Nothing like burning a big pile of money to entertain children. And dividends are great but they certainly will not make up for a 43% drop in nine months. And there are much safer dividend paying equities out there. But as you basically say, I don’t care, I’m just going to lose money anyway. Sure. Of course you don’t. It does make me wonder though why you would invest in the first place? Next time, if there is another next time, take your profit. I’ll let you know how to contact me and I’ll put it to good use. I promise I won’t buy anything not made by Apple. Mac Pros, MacBook Pros, Mac Mini servers etc. I can always use more. You and the spirit will be quite happy with me. And let’s not forget, waste not want not. Steve would approve. That way you can keep true to your mission of watching over the spirit and DNA of Apple. Sure.

  3. Basically it’s a buy. People want to manipulate it with rumors and bad info, but the numbers really don’t express what this company is worth. Why is Microcrap up? they sell crap products and piss their customers off. This stock should be in the Mid $600 right now NOT Below $400. Apple Should get into gaming, Make Their own Search Engine(as they have a Ad arm), Get more into Commercial/business and blah blah..Tired eating pie,…NO MORE ROTTEN APPLES!!….

      1. yes. How far do you think it will fall? down to $300? Would Apple be stupid not to buy their own stock back at a cheaper price then wait till it goes up?

        But I do see a few things wrong.
        1- iOS7 looks like it will suck, Don’t think people will like the flat design as it’s regressive(cheap) The performance of course is always a plus but they do need to make it more flashy and make it look like it’s worth Money.
        2- a larger phone, people like big screens and seeing what’s comparable in the market now to what they have, the larger screen is nice and more easily viewed. and Who likes watching video on such a small screen or play games?
        3- They need to throw something out Every Quarter, Hand hold everyone on what the new products are, new software, and what they are doing better as the silent treatment pisses people off. They can even leak their own stuff more efficiently( as you KNOW it’s gonna happen anyway).
        4- and why can’t I play iOS games on my mac and use my phone/pad/touch as a controller??

        1. Ask the people that bought at $600.00 convincing themselves it was a buying opportunity.

          Ask the people that bought at $500.00 convincing themselves it was a buying opportunity.

          Now your saying it’s a buying opportunity at $400.00. You weren’t the one saying it was a buying opportunity at 500 or 600 were you?

          1. Who says you have to buy AAPL? Is it the only stock out there? Would you keep stepping in front of a bus getting hit time after time after time? Or would you eventually realize that if you don’t step in front of the bus you won’t get hit? Let it go by. Then you can cross the street. The definition of insanity is someone who keeps doing the same thing over and over and over even though they know it’s wrong. Invest your money in something besides AAPL. It’s okay. No one will know but you. Invest in something that doesn’t continue to go down. Just because it has dropped a lot doesn’t mean that it’s a bargain. Quit yelling and screaming about manipulation and invest your money responsibly. Look at all the money you have lost just in the last six months by not investing in other stocks. That doesn’t mean that AAPL won’t go up again someday. But you are not tied to any one stock. Doesn’t matter whether you love the company or hate the company, it’s either a good investment or a bad investment. It’s down 43% since September. How much more money do you need to lose? Would you make such a terrible decision with anything else in life? Of course not. So stop it. Stop it now. Quit moaning and groaning and save what little money you have left. Make it grow. Remember you don’t have to get in on the first or the last 10% of a stock move. If Apple makes a move upward you will have plenty of time to put a little money there. Just don’t make the mistake ever again of allocating too much money into any investment. Learn to diversify. Don’t be foolish.

            1. That’s my agenda here to sow doubt and discourage fanfare and loyal childish investors. Why else would anyone come here to MDN to bash fanbois? Well there’s some deep pockets out there that pay big bucks for guys like me…..

    1. I can understand Apple being down, but I fail to see why Microsoft stock is doing so well since the company’s product performance hasn’t been any better than Apple over the last year or so. Maybe the stock had been depressed over a number of years, so there was some upside to be had. I guess it must be one of those market emotion things that I can’t quite grasp.

  4. The stock can drop to $0 and Cook & Co. still won’t succumb to the pressure to rush new products out the door in appeasement of those Wall Street nimrods. If Steve taught them anything, it’s that you don’t release anything until you’re sure you can’t make it any better.

    Imagine what the iPhone would’ve been if Apple released one of their half-baked early prototypes rather than the polished device we saw in January 2007. Imagine if Steve and Jony hadn’t taken the time to make those last minute changes. There might not have been a smartphone revolution.

    These clowns desperately want new product from Apple and they’ll get it when they’re ready to be delivered.

  5. Apple has not released a new product since last year (the better battery in the Air is so laughably NOT a new product) and has no plans to release anything until September, at the earliest. And what they plan to release in the fall is a modest ho-hum upgrade of the iPhone 5, which was a tiny upgrade to the 4S, which was a small bump upgrade to the 4. I have been on MDN every week trying to alert people to the decline in enthusiasm this unexciting release pattern has generated but I get called out for being a hater or a troll. No, I’m not. I’ve owned Apple products for over a decade now and this last three year period has seen a decline in bold vision and excitement. Ignore and invest now at your peril. I believe when the iPhone 5s comes out, and everyone realizes it’s an unexciting marginal upgrade, the stock will go down even further. $400 will feel like a dream in October after Cook announces the “new” phone. iCal me.

    1. I could not agree with you more. Been a proud iPhone owner since 2009 but if u say anything other than “Apple can do no wrong!!” around here and they will call u a troll…

  6. The sound that Apple’s free fall makes on concrete on contact will be that of a watermelon digging a 5′ hole in the ground with bits of red everywhere.

    Tim Cook has lost the plot. iOS 7 is a piece of shit.

  7. I must admit Apple at this price is a far cry from the Apple going to $1000 a share of last year but that’s how things go. I never expected to be rich in my lifetime but I’m actually doing pretty well since buying most of my Apple shares at under $100. I guess I could have gotten stuck with some company that’s done far worse. I’m not dreaming of ever seeing Apple going back to $700 but $500 honestly seems possible. The dividends I get from Apple alone easily pays all my living expenses every month, so I guess I can’t complain. At one time I thought Apple was going to be a highly valued company like Microsoft, but I misjudged it by a mile. I suppose Steve Jobs death changed everything. I still believe in quality Apple products, so I have no intention of discarding my Apple shares as long as consumers continue to buy Apple products.

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