Apple rebound pushes shares back above $500
One reason for the gain is an analyst's call that the stock has bottomed and could rally up to $600. The debate rages on whether iPhone sales are slumping.
Only Tuesday, Apple (AAPL) shares were getting slammed. On Wednesday, they became hot again.
The shares closed up $21.17 to $506.09 after reaching a high of $509.44. The gain was was the largest for Apple since a $22.58 gain on Dec. 31. The shares were the top performer among Nasdaq-100 ($NDX) and fourth-best among Standard & Poor's 500 ($INX) stocks.
One reason for the surge was a call late Tuesday by Tom DeMark of Market Studies, which does market-timing studies. DeMark told CNBC he thought Apple had bottomed on Tuesday; he'd thought the bottom would be $494 or so.
The stock closed Tuesday at $485.92, its first close under $500 in nearly a year and down more than 31% from its peak in mid-September. With Wednesday's gains, the loss has been trimmed to roughly 28%.
What's next? DeMark said Apple could rally up to $600 in the next few weeks.
Another reason was a Forbes.com column suggesting that The Wall Street Journal may well have been wrong in a Monday article when it argued that iPhone 5 demand is less than expected. The story based the conclusion on reports that Apple had asked suppliers to cut the number of iPhone 5 display screens by about half for Apple's fiscal second quarter.
The reason anyone cares about The Journal story is that it was a key catalyst that pushed Apple shares down 3.6% on Monday and an additional 3.2% on Tuesday.
The second quarter is one of the slowest of the year for Apple. So, if the company had originally ordered 65 million screens, it did so to be sure there was enough supply, Forbes said.
The company said it sold 5 million units in its first weekend in September. On Dec. 17, the company said it had sold an additional 2 million units in China on their first weekend of availability.
Apple should offer more detail on Jan. 23, when it reports fiscal first-quarter results. The consensus on Wall Street is for earnings of $13.35 a share, down from $13.85 a year earlier. Revenue is expected to jump 17.8% to $54.6 billion. Analysts see earnings accelerating in the third and fourth quarters.
There is, in fact, a huge and expensive debate going on now over Apple, which has been a darling of hedge funds over the past few years. But the selloff that started in mid-September has surprised many investors and analysts.
The stakes seemed to ratchet up this week on The Journal report and Nomura Securities cutting its price target on Apple from $660 to $530.
Nomura analyst Stuart Jeffrey believes the demand for the iPhone 5 hasn't been that robust, and he told CNBC on Tuesday expects the iPhone 5 will face steep competition in emerging markets. That will squeeze profit margins.
More on Money Now
- Love energy drinks? See you in the ER
- 9 ways feds bungled foreclosure crisis
- Forget the flu: Sydney vomiting bug is here
How many times have you heard someone say they would love to buy apple`s
stock if they ever would split the stock?
Copyright © 2013 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
[BRIEFING.COM] The stock market experienced a flat finish to an otherwise-forgettable week. The S&P 500 shed less than one point, maintaining its December loss of 1.7%. Small-caps outperformed as the Russell 2000 gained 0.4%, but the index remains lower by 3.1% this month.
Equities registered opening gains, but the early strength faded during the first 30 minutes of action, sending the major averages to their lows. The key indices spent the rest of the morning near their flat lines ... More
More Market News
While the former looks to expand its snack and soda exposure, the latter struggles to stabilize management.