Shares of Apple dip more than 2% following downgrade from Japanese bank
Shares of Apple stock took an unexpected slide on Thursday, and dragged the larger market down as a whole with it, after a high-profile Japanese bank downgraded its rating on the iPhone maker to "neutral."
Mizuho Securities issued a note to investors on Thursday, saying it believes the risk-reward level for shares of AAPL is "well-balanced at the current level." The firm has pegged the upside for AAPL stock at between $130 and $140, while the downside is in the mid-$80s, according to Reuters.
The Japanese investment banking and securities firm is the second-biggest financial services conglomerate in Japan. The update from Mizuho Securities was attributed to losses seen in AAPL stock on Thursday, which was down more than 2.3 percent in afternoon trading.
Shares of Apple are down more than $10 from their all-time high of $119.75, achieved in late November. But the company is still up considerably from its 52-week low of $70.51, adjusted for the 7-for-1 split that took place in June.
Apple's market capitalization level is currently valued at around $630 billion, also off from the $700-billion-plus the company achieved with its record highs in November.
Despite recent fluctuations, investors still have high hopes for Apple and its just-concluded December quarter, which is widely expected to have been an all-time best for the iPhone maker. Analysts expect Apple sold as many as 69 million iPhones in the three-month holiday span, which would crush its previous best of 51 million in the year-ago period.
Mizuho Securities issued a note to investors on Thursday, saying it believes the risk-reward level for shares of AAPL is "well-balanced at the current level." The firm has pegged the upside for AAPL stock at between $130 and $140, while the downside is in the mid-$80s, according to Reuters.
The Japanese investment banking and securities firm is the second-biggest financial services conglomerate in Japan. The update from Mizuho Securities was attributed to losses seen in AAPL stock on Thursday, which was down more than 2.3 percent in afternoon trading.
Shares of Apple are down more than $10 from their all-time high of $119.75, achieved in late November. But the company is still up considerably from its 52-week low of $70.51, adjusted for the 7-for-1 split that took place in June.
Apple's market capitalization level is currently valued at around $630 billion, also off from the $700-billion-plus the company achieved with its record highs in November.
Despite recent fluctuations, investors still have high hopes for Apple and its just-concluded December quarter, which is widely expected to have been an all-time best for the iPhone maker. Analysts expect Apple sold as many as 69 million iPhones in the three-month holiday span, which would crush its previous best of 51 million in the year-ago period.
Comments
I stopped listening to these types of reports from the so called anal-yst. With an expected record-breaking sales during the past 3 months, Apple will take in net profits the rest of the industry could only dream of.
These guys aren't looking 2 weeks down the road.
Its buying time.
I wonder how many shares those bad-mouthers bought after their comment drove the price down?
I think it's working out great. My daughter said "I love this piece of technology, and I have never had that reaction to any piece of technology before. Ever."
Sure, that's anectodal, but it's a really great anecdote.
Apple has only just now had supply come into balance with demand (I think), so only just now are they or anyone else able to assess what the demand really is. So, that's on the market side.
Myself, I don't see that the watch will disappoint. I think it will be a good first year & they will sell all they can make right up to around this time next year ( Jan 15 2016 ) and *then* we (and Apple) will know what the demand really is.
Thus, I do not think Mizuho Securities assessment is correct. Most of these evals are pretty superficial anyway, just as stock price is a fairly superficial indicator of value.
Buy buy buy
and do you know that "don't try to catch falling knife" ? it will be really hard to beat analyst estimates this time and given overall market situation i think shares will stay flat or will drop, because they are still relatively high.
Two words from me... Buying opportunity. I picked up ten shares today at $107.31. If shares drop $2 more tomorrow, I'll pick up another ten shares. As far as I'm concerned, it's money in the bank for me. I feel confident Apple will go back up to $120 around earnings, but I'm in for the long term and I'm in for increased dividends. I don't feel there is much risk at all as far as Apple is concerned. I'm more concerned about the overall economy. Even so I'll still have the dividends. If Wall Street actually has an agenda to suppress Apple's share value, well, then it can't be helped. I'll take what I can get and be satisfied with it.
Dudes, I definitely see the rationale. When anyone buys 70 million of ANYTHING, they aren't gonna do it again right away. It's an interesting question, though, as to why so many people got larger iPhones, and who they were. For the most part, they got them not even knowing what it would feel like to use them, and no one else saw them using them either. So, now that they're in the world, how's it working out?
It's important to note that Apple is the last major smartphone handset company to introduce these larger phones. They already understand the popularity of these sized devices because people have been buying them from the competition for years.
Amongst my friends, most of these people who acquired the iPhone 6 (or 6 Plus) were previous iPhone users. Some of them have dabbled with whatever phone is hot every two years, regardless of the manufacturer. Some of those people have been using larger handsets from other manufacturers so they know what it is like. One of my buddies who bought the iPhone 6 had been carrying around a dumb phone and an iPod touch, something I was doing in 2011. Some of these people were due for a new handset, a few bit the bullet and paid extra, simply because they wanted the bigger handset now (rather than wait another year or two).
For one thing, the extra large iPhone is a particular hit in southeast Asia, where the consumers prefer such devices. In the same way, white consumer electronics are popular in this particular region (white electronics are also particularly popular in Europe), so there are some underlying preferences in various parts of the world.
Apple probably has a pretty good understanding of who the iPhone 6 and 6 Plus users are, but that's company confidential information. I'm not sure how much data iOS app developers are privy to, but probably get some sort of summary of the market breakdown in terms of iOS versions, device models, etc.
Samsung has warned of a slowdown in sales for their high-end phones. This means that many people who used to buy their handsets are going elsewhere.
Remember that the world population is growing as a whole, as well as the United States population. As a matter of fact, I believe the U.S. needs to create over 150K new jobs per month just to keep unemployment percentage flat. Are all of those new workers buying iPhones? No, of course not, but it illustrates the fact that there are new customers every day.
Apple's growth is a combination of new customers as well as stealing customers from their competitors. It's the same as almost any other business, whether it's a barber shop or a bar. Every day, there's a little boy getting his first haircut from a real barber. Every day, there's someone celebrating their 21st birthday with alcohol. But there are also people who have been going to barbers for years, and those who celebrated their 21st birthdays a long time ago.
Well the stock market needs contrarians, too. It's just sad that one contrarian can have such sway on a stock price. Suggests to me that those trading AAPL have no clue who or what to believe. That makes it a stock vulnerable to easy manipulation. So, as others have said, this is a buying opportunity. And there will be others in the future, too. In my opinion.
Wait until after the Apple watch is released to buy.
You're probably right. lol
A range of $80 to $140? That looks like some lousy forecasting... although it should be noted that AAPL was at $96.26 a mere 3 months ago (unfairly).
A range of $80 to $140? That's some lousy forecasting.
Why?
Take a look at AAPL over the last 4 years.
The swings are huge.
I stopped listening to these types of reports from the so called anal-yst. With an expected record-breaking sales during the past 3 months, Apple will take in net profits the rest of the industry could only dream of.
That still won't guarantee Apple's share price going up considerably. Wall Street can turn solid earners into share price laggards and turn profitless companies into huge share price gainers based on specious potential growth opportunities. Although Apple sits at the top as being a very unique company (considering it's nearly $300 billion more in market cap value than the nearest company), Wall Street doesn't see it that way. Wall Street sees Apple as a toothless old dog with little future potential. Apple shareholders will simply have to put up with that myopic perspective. As a shareholder you can either believe in the company or not. Just don't get your hopes up too high thinking Apple's P/E is going to rise. I'm willing to bet even with a blow-out quarter of $70 billion in revenue Apple's P/E will remain considerably lower than Microsoft's P/E. That's just the way it is with Apple.
I am sure that Apple is a good investment right now. Mainly because they are the only market entrant who has a product that they control all the components of. Intel and Microsoft have already gone separate ways so now there is no one else with this scale and control. The Chinese competitors are much more of a competitor then anyone else and they are dependent on Google for their platform.
The Apple watch is just more of the same magic. Control the product, the software, the platform, the timing of market introduction and you have a winning hand. Apple's only weakness is the cloud services. They are not market leading in their simplicity, interfaces, or features. They are tied to the ecosystem so pretty hard to avoid them if you use Apple.
I would agree with the general consensus that Apple has more desire to ship then get things perfect. If the updates continue to fix all the major issues in 4 months then we are still looking at over a one year lead time over Google. Google can't get any adopters for their newest software because it simply does not work.
There is not another business out there with this level of cash on hand, market control, growth in earnings and low PE. If you find a better investment buy it too.
Why?
Take a look at AAPL over the last 4 years.
The swings are huge.
I still haven't decided if this is a net positive or negative...perhaps it should simply be considered an Apple stock "law". To a long, it's relatively immaterial since the annual gains are often substantial. For a company of their size and valuation, I cannot recall a similar company demonstrating such wild stock price swings (except during the first dot-com boom and bust).