Once-Mighty Apple Stock Plunges Over 10% in 10 Days
Apple stock—which seemed almost invincible a few weeks ago—skidded into correction territory Friday after plunging more than 10 percent from its all-time high just 10 days ago.
The iPad maker’s shares declined another 2.5 percent on Friday to finish near $573 a share. This is the eighth out of the last nine trading sessions that the stock has traded in negative territory.
Apple’s seen a stellar run this year, surging more than 40 percent to hit its all-time high of $644 on April 10. The firm also became the world’s most valuable company, when its market cap first crossed $600 billion.
“[The stock] is way up and people think it has risk," said Art Cashin, director of floor operations at UBS Financial Services. "The real risk is if people say: 'It’s had a great ride, I’m going to take profits.' I think you’re seeing some of that.”
Apple is scheduled to post quarterly earnings next Tuesday, and traders have said some investors are taking profits ahead of the announcement.
“We’re seeing a pause in the stock,” said Andy Hargreaves, senior research analyst at Pacific Crest Securities. “People have made a lot of money on Apple and with earnings coming up [next Tuesday], they’re worried about cautious guidance in addition to iPhone and iPad demand.”
The stock has also been plagued by more-than-the-usual Apple speculation, including rumors that iPhone sales would be weaker than expected this quarter. There have also been ongoing concerns about iPad and Mac sales.
Adding to woes, Verizon , feeling the pinch of Apple's pricey iPhone, announced it wants to help rival Microsoft succeed in creating an alternative mobile platform.
Analysts, however, have continued to ramp up their price targets. Canaccord Genuity earlier this week raised its price target on the firm to $740 from $710 and maintained its "buy" rating, saying it expects strong second-quarter results.
But not all are convinced that the stock is a keeper. Edward Zabitsky, CEO and analyst of ACI Research, has a “sell” rating on the stock with a price target of $270, citing competition from the Samsung Galaxy and HTC 1X.
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