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AAPL Stock: 101.32 ( + 0.74 )

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Apple hit with sharp stock drop following warnings

updated 11:00 am EDT, Mon September 29, 2008

Apple stock drop

The worth of Apple stock has fallen significantly, over $20 as of press time, following warnings from two different analysts. Mike Abramsky of RBC Capital has downgraded Apple's rating from "Outperform" to "Sector Perform," with a new stock target of just $140, compared to an earlier value of $200. His FY08 EPS estimate has slid from $5.28 to $5.26, and in FY09, the prediction is now for $5.75 instead of $6.07. FY10 could slip from $8.03 to $7.38.

Abramsky links the downgrade with a "worsening consumer spending environment," particularly when it comes to Macs. A September ChangeWave survey indicates that just 29 percent intend to buy a MacBook in the next 90 days, as compared to 34 percent in August; likewise, only 26 percent are now looking to buy a Mac desktop, versus August's 30 percent. This is said the be the largest decline in these figures for two-and-a-half years. Interest in electronics is in fact said to have "the weakest outlook ever seen," with 40 percent planning on spending less in the next 90 days, despite the holiday season.

Morgan Stanley's Kathryn Huberty, meanwhile, has switched Apple stock from "Overweight" to "Equal Weight," slashing her expected price target from $178 down to $115. Her FY09 EPS has dropped from $5.91 to $5.47, while FY10 figures have been moved from $8.07 to $6.92. Huberty comments that computer sales are losing ground as a whole, except for the sub-$1,000 market, where Apple does not have anything to offer. Regardless, she notes, "even in the best of scenarios, AAPL's EPS growth will decelerate meaningfully from June quarter levels."




by MacNN Staff

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Comments

  1. horvatic

    Joined: Dec 1969

    -4

    NO that's ANAL-ISTS

    Idiots, people who don't have a clue about Apple's business.
    They're dropping Apple's stock because they feel like it. No facts or proof to back up any of there claims. And what does the rest of the IDIOT Anal-ists do? They follow them like blind men walking off a cliff!

    YOU ANAL-ISTS are all IDIOTS!!!!!!!!!!!!!!!!!

  1. climacs

    Joined: Dec 1969

    +7

    buy

    time to buy

    wish I'd sold when it touched $190 recently LOL!

    anyway catch it on the downswing, these anal-ists' opinions are being magnified by the stock market panic today

  1. eldarkus

    Joined: Dec 1969

    +8

    THANK YOU!!!

    thanks analysts.. Just bought some more at $107.

  1. bobolicious

    Joined: Dec 1969

    +2

    Upgrade cycles...

    ...for me are ready to replace 1G intel macs & just waiting on the new macbook pro announcements to pony up significant hardware dollars as well as just buying a 4g nano which I am so impressed with I am ecstatic - to me the product line has never been stronger - hopefully the pc->mac paradigm shift will surprise many - everyone I know is switching or has switched...

  1. Guest

    Joined: Dec 1969

    +1

    Calm down.

    Wow, is Apple a religion for you two? The analyst is just stating the reality of the U.S. economy at the moment--that people won't be buying shiny gadgets when they can't pay their mortgage. Also, this is a downgrade to the outlook for the stock price. If you really think this person is wrong then buy up Apple stock--this should be a great opportunity for you to make money on a bad stock projection.

    Comment buried. Show
  1. testudo

    Joined: Dec 1969

    -10

    of course!

    If someone downgrades apple stock, they are idiots who are just doing something because they have a personal vendetta against Apple (probably old Beatles fans who still can't get past how Apple stole the name of the company or something).

    But, horvatic, if you're going to complain about idiotic "people who don't have a clue about Apple's business." and that "They're dropping Apple's stock because they feel like it. No facts or proof to back up any of there claims. ", the least you could do is:

    - show proof that they just feel like it
    - show proof as to why they're wrong

    as opposed to just arguing the lack of proof with a lack of proof. Because I'm sure you're not bashing 'anal-ists' (oh, so funny!) because you just feel like it.

    And climacs and eldarkus are completely right (esp. if you're claims are correct). Instead of whining, you should be pushing as much money you can into the stock. There's no better way to show analysts they're wrong then to flash your wad of green in their face.

  1. Eldernorm

    Joined: Dec 1969

    -1

    @guest

    Actually I did just that. I cannot afford a lot of stock right now but I am buying. Hey, Apple is selling more computers, iPods,and iPhones than ever.

    Say, if these Anal -ysts are proven wrong, will they have the good sense to fall on their swords, or at least pens.???????

    Actually there is a rumor going round that since Apple buyers/sellers seem to follow these anal-yst with abandon and wild cost swings, that there is some serious stock manipulation going on here. Build Apple up with wild stories, Sell it, bring it down with stupid comparisons, buy it. At a 100% change in price, this makes for large profits.

    Just a thought,
    en

  1. testudo

    Joined: Dec 1969

    +3

    i wonder

    if that person leaping in the imac picture is an apple stock holder taking the plunge?

  1. boomer0127

    Joined: Dec 1969

    +3

    Maybe...

    The august/september difference is because lots of those folks actually *bought* the iMacs they planned to buy?

  1. jstephe

    Joined: Dec 1969

    -3

    To much cash

    The real problem with Apple is they have way too much of that cash stuff just laying around in those insecure financial institutions. Any one with cash is wishing they were broke like me;-) this makes me feel so much better about being leveraged to the hilt, my cash can't disappear with some greedy bank CEO.

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