If you would have asked any stock analyst in the world back in September when Apple shares were sitting at $705 if shares had a chance of falling below $400 within six months, they would have admonished you for being a moron. It wasn’t going to happen. It couldn’t.
Now that we’re five months out from the peak of Apple’s value, it seems that $400 isn’t such an impossible number after all. The stock closed yesterday at $430.47, down $10.93 from the day before to reach its lowest point since the slide started last September. It seems that Apple may have fallen victim to their own hype machine in many ways. They grew too quickly in 2011 and 2012, sending risk-taking investors to the ocean to ride the wave. Now that the wave seems to be over, they’re selling off to any of the bargain hunters willing to play the long-term game.
That’s where we stand and it doesn’t appear to be getting much better for the stock.
Keep in mind, this isn’t necessarily a reflection on the health of the company itself. Apple is fine. Sales are fine. Products are fine. Leadership is fine. It simply means that the company may have been overvalued last year and is rightsizing this year. It also means that the stock may be primed to start a new wave soon. The question that every interest investor is asking is, “Where is the bottom?”