Apple crashes into bear market: Poof! $150 billion up in smoke

“Apple diehards who keep saying the stock ‘will come back’ are going into hibernation today,” Matt Krantz reports for USA Today.

“Shares of the gadget maker Friday are down another 1.3% Friday to $107.61 – knocking the stock down 20% from its recent high of $134.54,” Krantz reports. “The breathtaking decline not only puts Apple into a bear market – defined by a 20% drop – but has obliterated a staggering $150 billion in shareholder wealth from the top.”

“Just to put that into perspective, Apple’s $150 billion decline is larger than 475 companies in the Standard & Poor’s 500 are worth,” Krantz reports. “A drop this big is the financial equivalent of wiping out the market value of entire companies like Pepsico at $145 billion, International Business Machines at $133 billion and Nike at $111 billion.”

Read more in the full article here.

MacDailyNews Take: Those year-end commission-generating actionable notes certainly created some action.

Delousing the shareholder pool of reactionary ignoramuses isn’t necessarily a bad thing in the long run.

The calls from the brokers to their clients would be something along the following lines:

• To a client that is already long the broker would say, “our analyst just found out some information not yet out on the Street and he says shares will remain weak for weeks and quarters and you should sell your shares in Apple and buy XYZ instead.”
• To a client that has no position in Apple, the broker would say, “our analyst just made a great call on Apple and the shares are down around $3 per share and I know you have wanted to buy Apple and here is your opportunity. He still has an Outperform on the stock with a $140 price target.”

So, what the analyst did here is come out with a negative note that will get the shares moving, in this case lower (matters not actually) and allow the brokers to call their clients and ask them to buy/add/sell as the case may be.

It’s called an “actionable” research report in the business. — Jay Somaney, Forbes, November 10, 2015

RBC cuts Apple price target to $140, citing iPhone supply chain concerns – December 17, 2015
Piper Jaffray: Individual component suppliers are not indicative of the health of Apple’s overall iPhone business – December 16, 2015
Apple stock slumps on Dialog Semi warning – December 15, 2015
Analysts baselessly warning of ‘Peak iPhone’ allow Apple to buy back even more outstanding shares – December 15, 2015
Apple suppliers hit by Morgan Stanley’s iPhone sales forecast – December 15, 2015
Some analysts see Apple iPhone sales seen turning negative in 2016 – December 14, 2015
Cramer: Apple shares may not have momentum but they’re cheap – December 14, 2015
Morgan Stanley slashes Apple price target by 12%; shares fall in pre-market trading – December 14, 2015
Apple stock slides on Credit Suisse claims of iPhone component order cuts, weak iPhone 6s demand – December 2, 2015
UBS analyst’s latest ‘research’ note on Apple is just another ‘actionable’ note and should be totally ignored – November 16, 2015
Apple shares continue to get slammed on commission/bonus related ‘actionable research’ – November 10, 2015
Apple lower after Credit Suisse notes substantial supply-chain cuts – November 10, 2015

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.