Apple Shares Tank on New Mac Data

Ouch. That'd be the snap analysis of the new market research from NPD about Mac sales in March, and the news for Apple simply isn't good.

Apple's logo on a wall of an Apple store
Cancan Chu | Getty Images
Apple's logo on a wall of an Apple store

And if you're watching action in Apple shares right now, you're probably wondering just what the heck is going on.

Why the sell-off? This might be one of those classic examples of expectations exceeding reality, and therefore we have a sell-on-the-news scenario just a day ahead of Apple's earnings release.

NPD reported that Mac sales went from a year-over-year increase in February of 43 percent to a year-over-year increase of only 7 percent in March. And while Piper Jaffray's Gene Munster still believes Apple can hit his unit expectations of 2.8 million to 2.9 million Macs sold during the quarter, he had anticipated growth around 20 percent in March, which would have translated into a Mac sales number of over 3 million units.

In other words, even before Apple reports its earnings, NPD says the company will likely miss the rather optimistic whisper numbers floating around the Street. Apple shares are getting hit hard because of this. Munster says desktop sales dropped 5 percent year-over-year in March while laptops increased 14 percent.

Overall, NPD says overall, Mac sales increased 25 percent year-over-year for Apple's March quarter. Consensus was up about 22 percent. But weakness in the month of March is likely what's causing today's sell-off. It's a clear case of good news simply not being good enough.

Munster writes in a note to clients: "This data, along with our assumptions for international Mac sales, which are likely growing faster than domestic sales, implies year-over-year Mac unit growth of 25 to 31 percent, above the Street at about 22 percent year-over-year growth." Yeah, good, but not good enough.

After all this, and even with today's share price decline, Munster maintains his "overweight" on the shares and a $299 target. Oh, and by the way: I'll have a more complete Apple earnings preview in an upcoming post shortly.

Questions? Comments?