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AAPL Stock: 562.29 ( -3.03 )

AAPL stock run prompts another downgrade

updated 09:25 am EST, Wed December 14, 2005

AAPL downgraded by BofA


Banc of America Securities today earlier in the morning, said that the downgrade was made primarily because of concerns over valuation--as the stock is up nearly 40 percent since the end of September and 133 percent since December 2004, according to MarketWatch: "Analyst Keith Bachman said he still likes the company's story, as its central processing unit business appears to be tracking well, but he feels the stock's reward vs. risk profile is now more balanced given its recent run up and longer-term concerns over investor expectations for the iPod market and operating margins."

Despite the downgrade, the research firm increasted its stock price target to $76 from $52.

"We believe Apple's fundamentals are strong," Bachman said. "However, the recent run in the stock has left us uncomfortable recommending putting new money to work."

As noted earlier today, Apple was down in pre-trading, after the stock closed at an all-time high of $74.98 on Tuesday.


by MacNN Staff

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  1. TailsToo

    Mac Elite

    Joined: Jun 2004

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    12/14, 09:44am | report spam | Reply |

    Hmm...

    How do you raise the target price but downgrade the stock? Does this guy know what he is doing?

  1. jarod

    Fresh-Faced Recruit

    Joined: Apr 2005

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    12/14, 09:59am | report spam | Reply |

    CROCK OF SH*T

    This is all BULLSH*T!

    These two firms are at a desperate attempt to try and lower the stock price in order to buyit themselves and sell it back to their own clients. This is typical low balling from analysts that generally have a poor record of making money 'intelligently' for their clients.

    If their was a rating higher than OUTPERFORM for Apple today, that's exactly what the rating should be. Overvaluation my a**! Apple is still way UNDER valued.

    Banc of America and Bear Sterns are both downgraded to GET A CLUE

  1. gavinque

    Fresh-Faced Recruit

    Joined: Dec 2005

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    12/14, 11:28am | report spam | Reply |

    Bear IS full of Bull

    Amen brother!

    Bear is full of Bull when it comes to Apple.

    I was an employee of Bear Stearn & Co for over 8 years and NOT ONCE did they have accurate prediction of Apple's performance when they had major happenings in the tech market -- I kid you not!

    I believe that Andrew Neff is still the technology analyst for Bear Sterns everyone should call and give him a piece of their mind, I know I will be. Bear Stearn's public number is 1-800-999-2000.

    Please don't get me wrong on my dislike of Bear Stearns I still know some wonderful people their and the company as a whole isn't so bad as far as financial institutions go but Andrew Neff it just a bad judge on Apple performance, philosophy and business strategy.

    I know that Mac fans like myself know how the stock will preform because of sites like Macnn.com that keep us up-to-date on Apple Computer -- we know what's hot and what's not! We Mac fans know the value of Apple beyond the stock market and it's clueless analyst, except for Piper who seems to have some knowledge of how Apple might perform. Piper seems to have some Mac savvy analyst on staff.

    I know I'm running on but I just so sick of these financial companies that just downplay Apple so much because of bias or hatred, I don't know which. I believe they think that Apple is a toy company.

    Anyway I've said my peace, Call Bear Stearns and give them a piece of you mind!

    Mac today, Mac tomorrow, Mac forever! :)

  1. testudo

    Fresh-Faced Recruit

    Joined: Aug 2001

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    12/14, 01:11pm | report spam | Reply |

    Stock price

    Yep, someone dares downgrade or put out a less then stellar analysis of Apple, and they get creamed for being 'idiots' or the like.

    I can't believe its down $4 a share. Not that it dropped that much, but that I was stupid (or lucky) enough to sell my remaining shares monday for close to $75.

    And, of course, the pre-requisiste "Apple is only going to go higher!". Yeah, whatever. Apple right now (at $71 a share) has a market cap of $60 billion, a P/E ratio over 45, and in no way comes close to having assets that cover these values. Plus, the ONLY thing they have going for them is the iPod, a nice fad that could (I say COULD) fade at a moments notice. And then what?

    BTW, I've said it before and I'll say it again. A company's stock price is 100% based on what people think its worth. Nothing else. If people came to their senses tomorrow and decided that Apple computer was worth only $30 a share, that's what the price would go down to. Everyone can argue that its nonsense, but it is what it is.

  1. gavinque

    Fresh-Faced Recruit

    Joined: Dec 2005

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    12/14, 02:05pm | report spam | Reply |

    Testudo

    You could be right Testudo, but I beg to differ.

    iPod a fad - I think not and the market, analysts even Time Magazine and Business Week and others have left that idea behind.

    I own Apple stock - let me just let you know that my brokerage account is with Bear Stearns & Co. Inc. - I do trust them but not when it comes to Apple Computer.

    I'm not sure if your really that market savvy but a $4 drop in price is a very major thing, $4 on a 15,000 share holding is really a lot of money - It does add up.

    I think these gripes have to do more with building consumer confidence for those that pay attention to the financial markets - which is a great deal domestic and abroad. Also it has to do with the lack of understanding of companies that matter. As you know Apple (for the most part) it's like many other companies but other companies should take example from.

    It's not such a big deal that Bear Stearns or others downgrade the stock for the most part. I think to take these comments as outrage or yet another snobbish reaction- no - it's about a far shake in business performance.

    I don't see that anyone has called any analysts "idiots", Many do not have true insight into Apple Computer and think that Microsoft like strategies are the only game in town when it comes to technology companies.

    Are you aware that more than 88% of investors rely on analyst comments, predictions and the like. Who do you think your broker relies on in order to recommend a buy or sell to their customers - these analysts.

    Have you noticed that very few large financial companies actually correctly see Apple's future as they do other companies.

    "BTW, I've said it before and I'll say it again. A company's stock price is 100% based on what people think its worth."

    Your correct about your statement that the price is 100% based on what people think it's worth. Most people are sheep (including myself in some areas), they follow what others tell them that things are worth, fads and the like. Why do you think when Bear Stearns gave their rating the price lowered significantly for early morning trading? People listen and sometimes rely on others to tell them what things are worth, what's good and what's bad. I'm sure you know this and can agree.

    $4 is a significant drop for less than a full market day, incase you didn't know.

    No fight here, just wanted to make you aware of where I'm coming from with my comments.

  1. jarod

    Fresh-Faced Recruit

    Joined: Apr 2005

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    12/14, 04:11pm | report spam | Reply |

    testudo

    I also beg to differ:

    - the ipod is definately not a fad. A fad doesn't change the way the world works; in this case, listens to music. Apple took an idea and turned it into something that makes perfect sense for everyone and literally saved the music industry's a**. A fad doesn't even come remotely close to doing this or creates a whole new billion dollar market for itself.

    - 2nd, a stock is only worth what people think it's worth. while this might be true for some companies, its definately not applicable to companies like Apple who's products and innovation literally moves markets and changes the way you do things in your everyday life. Imagine a company announces tomorrow that they have a vaccine that cures cancer; do you think the stock is going to worth it's price simple because what people 'THINK' its worth. Get real. It's all about profits, always has been always will be.

    I have absolutely no respect for analysts like Bear Stern of the Banc of America. Those are the true liars and 'sheep' of the industry. As an investor, I study the companies I invest in. I look at the numbers and get a feel for the DNA and potential of the company, and THEN I decide what to buy and when to sell. Also note, I am not a financial wizard nor is finance my speciality; this is all common sense.

    Analysts are NOT your friends. They have agendas and bullsh*t downgrades as such just go on to prove that these guys are NOT reliable and cannot truly have a client's (or company's) best interest at heart.

    Unfortunately you're right about one thing, most people are sheep and don't think for themselves and hence you get a $4 drop on a stock that is WAY undervalued in my opinion. The only good news is that it's now cheaper to buy which is what those clowns at Bear and Banc of America were gunning for and got.

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