Apple’s stock closed at $419.85–its lowest closing price since its slide from $700 began last September. Apple is now down 40% from its peak. According to this information, it seems extremely possible for Apple’s business could take another turn for the worse, if not several more turns. Therefore, investors became concerned regarding Apple’s issues, continuing to dump the stock, on the theory that Apple’s growth days are over.
Not only that Apple’s earnings are expected to shrink year over year, but according to a big number of reports, the orders for the iPhones are anticipated to be extremely weak this, and also the next quarter.
In addition, Apple still leaves in the middle of a new-product blackout period, as the only potential for creating real excitement is a blockbuster new smartwatch (iWatch) and/or a spectacular new Apple TV. However, even these next revolutionary new products have their release date pushed further into the future as the company met resistance from the TV content and distribution industry, and they appear to be uncertain, and it is not clear whether consumers will see a need for the iWatch.
Furthermore, the investors are concerned because Apple no longer has the leverage with distributors and consumers that it once did as many of its customers seem to prefer choosing the competitors. Therefore, Apple finds itself in the situation to cut prices to remain competitive. For instance, Apple had to reduce the price for the new Mac, Apple’s 13-inch “Retina” MacBook Pro being sold for $1,499 instead of the $1,699 original price.
In addition to the fact that customers appear unwilling to pay a high amount of money just because the products are made by Apple because low-priced phones are capturing most of the market share, Apple is planning to offer a low-priced phone. Because the cheaper iPhone is not yet on the market, the company is missing out on this growth.
These represent a part of the factors that are weighing on Apple’s stock. However, stock prices represent a collective guess about what might happen in the future. No one can tell what will happen. That is why there can be made predictions regarding what will Apple’s stock do from here, but no one can be certain about these scenarios.
However, it can be said that, at this moment Apple looks cheap and is still in robust financial health. For this reason, even minor unexpected good news can drive the stock significantly higher.