Apple: Well, that was ugly

The stock fell more than 6% Friday, most of it in the last hour, as volume topped 100 million shares.

Contributing factors:

Cue the video:

My take: I’m sheltering in place, going outside only to shop for food, walk the dog and ride a bike to the river and back.

14 Comments

  1. Dan Scropos said:
    This is a moment in time, and it could get worse, where you have to believe in Tim Cook and the Apple management team (as well as its army of elite engineers and product designers). Tim seems to be the calm leader to navigate through these teams. We’re what, 50 days removed from a record fiscal quarter?

    Things will slowly return to normal. This might take 8 weeks or 8 months, but Apple’s installed base will still be there, and many of them will be ready to upgrade. In the meantime, Apple will retire a boatload of shares. I also expect them to begin to borrow a tremendous amount at these current rates.

    2
    March 21, 2020
  2. Jerry Doyle said:
    I am optimistic that this is a U shape recovery no matter all the talk of a global recession.

    The virus will move through in a period and on the other side is the largest, the most humongous infusion of global liquidity by Central Banks of the world the eyes have ever behold.

    People quarantined for weeks, perhaps months, will be anxious to return to activities of daily living and to the world of work establishing appropriate linkages with their contacts for the purpose of networking to do business. That means hitting the road, airports, hotels, restaurants, cruise liners, sports stadiums, trains, planes and buses to work, to play, to be entertained, to break out of hibernation and just give joy and blessings for new found freedom.

    It is for this reason I believe the economy will start its engines like a colossal, cosmic locomotive moving slowly at first to allow the boilers to build steam and then the speed of recovery starts to come on in a muscular, stout and stalwart upwards trajectory with all industries levitating with higher productivity.

    New Apple products are here with more exciting new and innovative ones to come heading into the renewed and revitalized fall and holiday periods with the Apple ship on course at maximum knots of speed filled to the brim with new Apple candies for a strong Q1 2021. We will be on our way quickly to a $400 share price. I believe that confidently.

    2
    March 21, 2020
    • David Emery said:
      The longer this lasts, the less certain I am about that recovery. A lot of people and businesses will chew through cash reserves, and many won’t make it, despite government intervention. Those in manufacturing can ramp up to meet demand, but those in service industries don’t have the same kind of ‘demand’ (I won’t get 2 haircuts in one week once we’re allowed back on the streets…)

      1
      March 21, 2020
  3. Kirk DeBernardi said:
    How many of us get that feeling we’ll kick ourselves in a somewhat distant future for not buying AAPL at these prices?

    More than wished they would have sold.

    5
    March 21, 2020
    • Jerry Doyle said:
      @Kirk DeBernardi: You are so correct! If one has discretionary dollars or some dry powder to target adding additional shares of Apple at this period and fails to do so then I and other long term Apple investors can say unequivocally that the individual will live to regret not having done so. Of course, not everyone is positioned to take advantage of these times, but those who are and do not often lament later in the future their failure to do so.

      The difficulty is knowing when the stock has tested its lows. Having that information is not possible, for no one knows with certainty the low point. The most prudent strategy is to stagger one’s entry. Go in at certain low periods that you know are bargain basement prices. Save a little dry powder for the next low, and so on. Just keep dipping in. I have dipped in twice since this crisis started.

      A year from now I am certain that we will see Apple $100 higher plus.

      1
      March 21, 2020
    • Fred Stein said:
      Yes. We can’t predict Covid-19 nor the economy nor the stock market.

      Even if Apple’s top line takes a bit hit, we can predict:
      1) They will buy back at least 5% of shares annually for years to come.
      2) They will return to growth.

      1
      March 21, 2020
  4. David Drinkwater said:
    It was bad everywhere:

    This may format badly, for which I apologize in advance.
    Sorry about the overshare, too, but it’s part of my dataset.

    Entity 3/14/2020 3/21/2020
    Me, YOY 1.07260891 0.9105813
    AAPL 289.95 229.24
    AAPL YoY 1.557865893 1.199895315
    DJIA 25865.78 19173.98
    DJIA YoY 1.000654187 0.75185238
    NASDAQ 8576.62 6879.52
    NASDAQ YoY 1.115508426 0.900146153
    S&P500 2973.37 2,304.92
    S&P500 YoY 1.053460078 $0.82

    0
    March 21, 2020
    • David Drinkwater said:
      Yeah, sorry, the TABS didn’t come through.

      0
      March 21, 2020
  5. Kathy Corby said:
    Can’t interpret the data, David, especially on my iPhone, but I’m curious about what you were trying to say. Can you clarify?

    0
    March 21, 2020
  6. David Drinkwater said:
    Definitions:
    Week 11 ended 3/13.
    Week 12 ended 3/20

    The presented data are where my holdings were year-over-year in Week 11 and Week 12 (up 7%, then down 9%)

    And then were entries for Apple, DJIA, NASDAQ, and S&P500, both in value and in year-over-year gain or loss in Week 11 and Week 12.

    DJIA, NASDAQ, and S&P500 were flat to slightly up YOY in Week 11, but all were down YoY in Week 12.

    Apple, however, even after the haircut was up 20% Y-o-Y on 3/20. So Apple is winning.

    0
    March 21, 2020

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