FBR: This ‘miserable, dark period’ for Apple investors will pass

“FBR & Co.’s Daniel Ives, who two weeks ago cut estimates for Apple’s iPhone sales, but came to the defense of the stock, this morning responds to overnight fears about Asia’s economic health, writing that ‘bearish sentiment has swung too far,'” Tiernan Ray reports for Barron’s.

“Ives acknowledges that for Apple investors, it has been ‘a miserable, dark period over the past few months’ that ‘is showing no signs of abating as the combination of 6s growth concerns and China fears this morning are further fueling the bonfire around Apple’s stock heading into 2016,'” Ray reports. “Looking past the gloom, Ives thinks estimates are now low enough for iPhone for the company to meet or beat expectations for the December, March and June quarters.”

We believe bearish sentiment has swung too far now as Cook has a relatively low iPhone unit bar for the dreaded March and June quarters in the countdown to the mega iPhone 7 product cycle slated for September. With our initial read on the December quarter/ holiday season coming in relatively strong, we believe Apple should be able to hit the Street’s iPhone forecasts for F1Q and that March/June estimates are now achievable with supply chain data points. We believe Apple represents a compelling risk/reward and would be buyers. — Daniel Ives, FBR & Co. analyst

Read more in the full article here.

MacDailyNews Take: The only question is how much farther can they push the buoy down?

AAPL is like a buoy. Quick, it’s back on the surface! You there, analyst, and you, too, swim down and tug on the chain! Drag it under… lower, lower… Good! Now, quick, everybody jump on, and we’ll take a ride back up to the top again!MacDailyNews Take, January 9, 2012

As we wrote in April 2012:

At the most basic level, it’s extremely simple: Pump, then dump. Foment, then buy. Rinse, lather, repeat as the SEC sleeps.


    1. Pump, then dump – is not true whatsoever, simply put there are more sellers than buyers – period, hence the constant and persistent downward pressure on the stock, my thinking is the big big money has lost interest for numerous reason ( botched product(s) releases, etc, etc ) – no question Apple is a tremendous cash generator and cash cow, that however does not seem to matter to Wall Street.

      1. I think because of the nature of the business Wall Street, as in truth it has always done, has doubts about the staying power of what it still views as a fashion statement. This is despite endless years of contradictory evidence and all the doom saying post SJ being but smoke and mirrors. After all we see some idiots on here still peddling this myth hoping beyond hope it will gain belated traction.

  1. Once upon a time, the major contributor to a company’s stock price was the performance of the company. Now it’s how far in one direction or the other can hedge funds push the stock. The fundamental structure of the stock market has changed and big banks and brokerage houses are the winners. Don’t look to Congress to change a thing. They need to keep big donors happy. The heck with the middle American investory.

    1. Exactly.

      Now days, stock prices in general, and Apple very specifically, are driven my analysts opinions and their FUD, whether ill informed or driven by profit motives. Or both.

      There is no longer a correlation between company performance and stock performance. The “performance” Tim and company are taking a beating for is stock performance, which they have no real control of.

      1. Agree with you both.

        The social contract that formed the foundation for the birth of the corporation has been stood on its head. The sale of stock was once a way to fund a venture and to spread the risks and rewards of large business ventures, and to provide liquidity to investors so they could sell stock and get money out of their investments. Back then, the business performance of the company was all important. Now, business performance seems to be of little importance to that part of the stock market dealing in short trades, now over half the market.

        In order to maintain the stability of our socioeconomic system there needs to be legal reform of the market. Technologically driven methods of short trading has gotten out of control. With an ever increasing ideological polarity between the two major political parties, don’t expect any change. Politicians would rather burn down the country than work together and compromise on reasonable solutions. Our growing backlog of problems are differed by partisan paralysis until the next election and some fictional political savior. Screw Republicans and Democrats, they are no longer Americans first, they are PARTY first. Vote independent or you will just be perpetuating the partisanship and the paralysis.

        1. Maybe another tier of taxation for stock related capital gains (in addition to short and long term) should be implemented.. Maybe at a 50% tax rate for trades on the same stock within a short period, say 7 trading days, to discourage automated and/or day trading.

  2. The hedge funds own the stock market and small retail investors are simply being pulled along for the ride. It’s just lucky when you pick the right company that the hedge funds deem worthy of share gains. Fundamentals aren’t worth anything to shareholders anymore for picking a good investment. To make growing companies worth dozens of times more than solid older companies doesn’t make much sense to me because no company can grow forever. In that sense Apple’s share value may be gone forever because there’s always new companies with plenty of growth being born even if the growth period only lasts for a couple of years and then the company disappears.

    I hope Apple is buying back as many shares as possible today because it’s the only thing I can look forward to now. With the Chinese stock market taking a swan dive I know Wall Street is going to say Apple is in deep trouble because no one in China will have any money left to buy Apple products. I really hope Apple is going to give a nice dividend increase to loyal shareholders to make it worth their while.

    1. Real investors, long investors, should understand that fundamentals mean very very little to short term traders of all flavors. If you only plan to hold a stock for a fraction of a second, or a few days at the most, then you are trading on something completely different than fundamentals, you are probably operating entirely on your interpretation of market sentiment, on emotion. For traders, there is no traditional analysis or logic involved. In my opinion, that is not good for the market, for the country, or for the average person who may have money at play.

  3. As a component of the Dow, the AAPL share price movement is now controlled by the gravitational pull of the index. The index functions as a natural restriction on rising share prices and benefits Apple tremendously as it buys back its shares. Shareholders would be better served if AAPL were to be removed from the Dow.

  4. Only if all of these idiots would go away who keep making up stupid stories of Apple’s failure with no facts to back them up with. The market believes every idiotic story of Apple’s demise when anyone with common sense knows that it is not true period.

  5. Warned all of you. Cook is too busy with his homo/transsexual/freak show lune leftist garbage to run the company right. Doesn’t even had the guts to bring his buddy to a public function, like all normal people.

    Stock is going to tank more

  6. Using the buoy analogy, I suppose how much it rises will depend on how much ‘damage’ the flotation components of the buoy has sustained (e.g. loss of material, flooding of ‘air compartments’, accumulation of foreign materials like barnacles and marine vegetation, etc.) and if there is still something anchoring it lower. 😀

    1. Actually that is a very good analogy self fulfilling prophecies certainly can have an effect if the destructive forces feeding them are for whatever reason strong enough. Self interest has no particular regard for the greater good.

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