Apple Inc. is at it again – meaning that the shares are slumping, just days after it turned in an impressive rebound that ended a five-day losing streak. In afternoon trading on Thursday, the shares were down 3.8 per cent, to about $585 (U.S.), which comes awfully close to Monday’s low of $580. (They ended the day down 3.4 per cent)
There are any number of reasons why the shares might be weakening, though nothing is specific. Some observers have warned that telecom carriers might cut the subsidies they use to attract new iPhone customers, while others are concerned that the upcoming quarterly results could show that iPad sales were weaker than expected. Apple reports its results after markets close on April 24.
Meanwhile, analysts continue to stand by the stock, as they did during the previous selloff. On Thursday, five analysts updated their views on the stock, with one of them actually raising the target price: Canaccord Genuity raised its target to $740 from $710. The other four analysts maintained their targets on the stock.
That follows Wednesday’s move by Goldman Sachs, when it raised its target on Apple to $750 from $700.
As well, Bloomberg News reported that Henderson Global Investors said that Apple is “extremely undervalued” and should rise to $1,200 – without specifying a time frame. Of course, Henderson might be talking its book here, given that Apple is the firm’s largest holding in its technology fund.
But speaking of large, Apple remains the world’s biggest firm by market capitalization and sits atop the S&P 500 in terms of its weighting within the benchmark U.S. index. When Apple’s share price did nothing but rise, this was good news, and it helped put the S&P 500 above the 30-member Dow Jones industrial average (where Apple does not reside) in terms of year-to-date performance. On the way down, though, Apple is taking a big bite out of the S&P 500.Report Typo/Error