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Are the Best Days Over for Apple's Stock?

Apple Senior Vice President of Worldwide product marketing Phil Schiller announces the new iPad Mini during an Apple special event at the historic California Theater on October 23, 2012 in San Jose, California.
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Apple Senior Vice President of Worldwide product marketing Phil Schiller announces the new iPad Mini during an Apple special event at the historic California Theater on October 23, 2012 in San Jose, California.

Has the Apple stock, which gained more than 70 percent this year, seen its best days?

Apple Senior Vice President of Worldwide product marketing Phil Schiller announces the new iPad Mini during an Apple special event at the historic California Theater on October 23, 2012 in San Jose, California.

Shares of the tech giant have shed more than 14 percent since hitting an all-time high of $705 in September, compared to theS&P 500 which lost 3 percent in the same period.

Even Tuesday's unveiling of Apple's highly-anticipated iPad Mini, smaller version of its popular iPad tablet, failed to boost sentiment as market watchers balked at the product's costly price tag, triggering a 3 percent fall in its stock .

According to Douglas Kass, founder of fund manager Seabreeze Partners, the company is no longer a buy and that Apple's golden age is over.

"Yeah...the stock is looking very vulnerable," Kass told CNBC. "Some of its competitors are growing agile and Apple is losing its first-mover advantage." (Read more: Doug Kass Buying These Stocks Now)

Solid earnings and new product launches have been behind the spectacular run-up in Apple's stock. The company has been delivering blowout earnings for the past three quarters and sales of new products such as the iPad 3 reached record highs in the June quarter.

But sentiment appeared to turn in September, when analysts began slashing sales estimates for the latest version of the iPhone, citing supply shortages, triggering the start of a month-long slide in the stock. Apple's track record of stellar earnings is also being questioned, prompting a series of profit forecast downgrades from analysts.

Apple is due to announce September quarter earnings on Thursday. It's expected to post earnings of $8.84 per share, according to analysts polled by Thomson Reuters, up from $7.05 per share in the same quarter a year earlier.

"I think people think it can't hold on to the earnings that it can and that's why the stock has been sliding," Rob Enderle, principal analyst of technology research house Enderle Group said.

The iPad Mini released overnight delivered the latest punch to Apple's stock. The 7.9-inch tablet was meant to expand Apple's tablet market share by taking on similar offerings from competitors such as Amazon, Google, Barnes and Noble, and Samsung. But priced at $329, it's considerably more expensive compared to Amazon's Kindle Fire which retails at $199 and Google's Nexus 7 at $249.

"I think this is a mistake. They have overpriced it," Scott Nations, chief investment officer of NationShares said on CNBC Asia's "Squawk Box". "People in the market for a product like this can now look at a Kindle...and say, I can save a whole lot of money by buying one of those products."

Premium Brand, Valuations to Help?

Still, some analysts argue that the Apple's brand cachet remains intact, and is reason enough for iPad Mini to do well.

"As has been proven, people are prepared to pay a premium for Apple. I see no reason why it will not happen again," said Phil Harpur, senior research manager at Frost & Sullivan in Sydney. "I think that although it would put off a certain percentage of the market for being too expensive, there are plenty of other people who would buy it. I am pretty confident of that."

This means that the stock will still have some upside, but at a slower rate, he said.

The stock should also be supported by valuations. Apple is trading at about 15 times current year's earning, compared to about 17 times of the S&P 500.

"With price earnings at about 15, I don't think we are going to see much more downside to Apple," Nations said. "Right from, $705 to $615 is pretty sickening if you got in late in the rally but let's face it, they do wonderful things with innovative products. And if what they do next has to do with TV, then there's no telling how big the Apple market for TV can be."

Apple TV, the next big product innovation that's rumored to be in the works, could be a 'game changer' for both the media industry and Apple, many analysts say. Talk of such a product arose after Apple CEO Tim Cook said earlier this year that technology for televisions was of "intense interest" to him.

—By CNBC's Jean Chua.

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