Munster: Apple ‘Fears Outweighing Fundamentals’
8:52 am, September 30th, 2008, Ed Sutherland
Did investors react too quickly to analyst comments which sent Apple shares tumbling 18 percent Monday? Add Piper Jaffray to the list of analyst firms now calling for calm.
“We recognize investors do not see light at the end of the tunnel as market fears appear to be outweighing fundamental analysis” Piper’s Apple analyst Gene Munster wrote Tuesday.
Those fears – not including the Dow plummeting 777 points – were spurred by a spate of downgrades of Apple stock as analysts said slowing consumer sales could derail the Cupertino, Calif. company.
Munster said Piper Jaffray remains confident in Apple, maintaining a “Buy” rating and a $250 share price target.
The analyst said numbers showing Mac growth slowing from 43 percent in July to 23 percent in August reflected August 2007, a time when Apple unveiled its new iMac.
Piper Jaffray instead expects 40 percent Mac growth in fiscal 2008 and 19 percent in fiscal 2009.
Munster said Apple “is better positioned than other tech players to weather” the current economic problems.
Earlier today, Goldman Sachs analyst David Bailey said Monday’s pullback “more than captures the concerns over Mac growth in a weakening spending environment.”
Citi also stuck with its “Buy” rating for Apple, but cut its target price for shares to $170 from $287.
On Monday, both Morgan Stanley and RBC Capital used talk of slowing consumer sales for cutting Apple’s target price and downgrading the stock.
Apple shares were up almost 6 percent to $111.
Posted by Ed Sutherland in Apple, News | Comment on this article
Maybe an enormous software giant was responsible for the bad rumours and resulting share price calamity so they could get in on a piece of the action at a cheaper price….
Pmoes, on September 30th, 2008 at 1:34 pm
There is a product release event (or atleast its a rumor that its a
release event) coming up on oct. 14. This is a very big indication of
what Apple is going to do for the future.
Read this http://cybertelegraph.blogspot.com/2008/09/apples-troubles.html
It explains that apple is lacking on low-end models that can be sold
in emerging markets, which will be a source of revenue during a
contraction in the US. If Apple does release something like that, you
can expect a significant bump in share price, at the risk of brand
dilution. Investors bet on this sort of long term news, at the least
it will give the stock price some direction for the next month or
so….
sanjayk, on September 30th, 2008 at 2:49 pm