Linked by Thom Holwerda on Wed 23rd Jan 2013 22:09 UTC
Apple "Apple Inc reported quarterly revenue that slightly missed Wall Street expectations as sales of its flagship iPhone came in below target, sending its shares down more than 4 percent. The world's largest technology company shipped 47.8 million iPhones, lower than the roughly 50 million that Wall Street analysts had predicted. Sales of the iPad came in at 22.9 million in the fiscal first quarter, about in line with forecasts." I'll leave the financials to the experts, but one thing that stood out to me: Apple sold 4.2 million Macs, almost a million below expectations. How much of a future does desktop computing have at Apple? Update: The NYT/Reuters changed the title during the night. Fixed it.
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Better than last year = disappointement?
by chiwaw on Thu 24th Jan 2013 07:05 UTC
chiwaw
Member since:
2006-02-05

Alright I know this site is anti-Apple, but really this news speaks volume about Wall Street much more than Apple itself. The company improved from last year, yet "disappointed" because it didn't grow as much as some Wall Street bozos guessed it would.

Let's just say, for the sake of argument, that Apple completely stagnate for the next 10 years, I mean they sell the exact same amount of iPhones, iPads and Macs every single years. Never less, never more. Basically turning a truck load of billions on profits every years.

Now because they would never hit Wall Street expectation for growth, the company would always disappoint, yet constantly bringing mind boggling profits in its coffers. But the disappointment would sink the stock down.

How does that even make sense? Someone who is more knowledgeable than me about the stock market can shed some light?

Edited 2013-01-24 07:06 UTC

Reply Score: 1

MOS6510 Member since:
2011-05-12

Apple used to beat expectation and even then the stock would go down.

I think shares, in general, have little to no attachment to reality. Analysts are guessing based on guessed numbers or "market trends". Everyone has a different conclusion.

People just try to buy low and sell high, nobody buys shares to get dividend instead of interest of a savings account.

Reply Parent Score: 3

Soulbender Member since:
2005-08-18

I think shares, in general, have little to no attachment to reality


I wish more people would realize this. Stock brokers lives in their own little world where panic is just around the corner and where reality have little influence.
Castles made of thin air, as the saying goes back in Sweden.

Reply Parent Score: 3

Thom_Holwerda Member since:
2005-06-29

Alright I know this site is anti-Apple


Oh sod off. Go complain at Reuters. I specifically chose the same source for the financial news as for Google, and it's still not good enough for you?

The company improved from last year, yet "disappointed" because it didn't grow as much as some Wall Street bozos guessed it would.


Stock price reflects the expected ability that an investment in said stock will generate a return. It has very little to do with past performance. Apparently, stock traders don't seem to think that investing in Apple's stock will yield them as much of a return as investing in other stock would. And considering the past few months of dropping stock, that seems to make sense.

Apple's stock doesn't exist in a vacuum. This is the basic mistake people seem to make. "Apple did great last quarter, so why is the stock going down?" Well, that's because investors seem to think there's more money to made with other stocks. It's really not that complicated. You'll most likely see the stock price bottom out - it may already have with -10% now - after which there's breathing room for the stock price to go up again, meaning there's money to be made.

All this stock drop highlights is how stupid Apple bloggers were when they proclaimed Apple would reach $1000. As it turns out, Apple's max is round and about the $700.

Edited 2013-01-24 09:47 UTC

Reply Parent Score: 2

Soulbender Member since:
2005-08-18

Stock price reflects the expected ability that an investment in said stock will generate a return


Stock price reflects the unrealistic and often incorrect expectations of the stock brokers.

Reply Parent Score: 3

chiwaw Member since:
2006-02-05

Oh sod off. Go complain at Reuters.


It's a little late for me to sod off. I'm probably one of the oldest reader here, going back to the early days of OSNews in the late '90s when I was dual booting BeOS and QNX Neutrino and looking for OS news ;)

I'm not complaining btw. Some blogs are hopelessly pro-Apple (Gizmodo!) some others are hopelessly anti-Apple (Slashdot!), it's all fair game. I don't expect blogs to be emotionally neutral toward a company like Apple that tends to always brew strong emotions on each sides.

Stock price reflects the *expected* ability that an investment in said stock will generate a return.


Thanks that's the part I was missing. The way I interpret it, say, half the stock value is what the company is right now, and half the price is what the company is expected to be in the future. That part is evaluated by stock analysts. If the company doesn't perform as planned, that portion of the stock price goes down (hence the whole stock goes down).

Am I too far from reality?

Reply Parent Score: 1

JAlexoid Member since:
2009-05-19

Profits dropped considerably. That's the disappointing part.

Edited 2013-01-24 14:19 UTC

Reply Parent Score: 1

chiwaw Member since:
2006-02-05

They actually turned a slightly higher profit than a year ago ($13.1 millions vs $13.06 millions). Not sure where you got your "Profits dropped considerably"...?

Reply Parent Score: 1