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Apple hits correction territory, closing down more than 10% from its record high

  • Shares of Apple close down more than 10 percent from the all-time high Friday, putting the stock in correction territory.

Shares of Apple closed in correction territory on Friday, down slightly more than 10 percent from its all-time high of 180, which it hit on Jan. 18.

The drop came on a day when the Dow dropped 665 points — its worst week in two years — and after a week in which the company reported quarterly earnings that beat expectations but revealed weaker-than-expected December-quarter iPhone unit sales.

The report also revealed weaker-than-expected guidance for the current quarter, leading many analysts to somewhat gloomier forecasts for the company.

"The verdict is in — the iPhone X/8 cycle is disappointing," said an analyst at Bernstein. "While Apple may launch a huge buyback, bolstering earnings for the next several years, we wonder if that is already priced into the stock, and note that Apple's longer term tax rate is likely to increase from FY 18 levels."

There was also positive news in Apple's earnings, as the company's enormous cash pile hit a record high, and the average selling price of iPhone soared.

"We're really proud to report our best quarter ever in the history of the company," said CEO Tim Cook in an interview with CNBC.

Others are also confident about the company's future. Analysts at Citi Research, which issued a buy rating on Apple last month, felt the negative response to Apple's earnings was overdone.

"We are convinced that sentiment on Apple stock in the past few weeks swung too far negative and the negative media news of order cuts added fuel. We believe the negativity is overdone and the majority of our thesis remains unchanged," an analyst at Citi Research said.